Bear Stearns, mortgage unit settle FTC charges

The Bear Stearns Co. LLC and subsidiary EMC Mortgage Corp. will pay $28 million to settle federal allegations that the companies "misrepresented the amounts borrowers owed, charged unauthorized fees, such as late fees, property inspection fees and loan modification fees, and engaged in unlawful and abusive collection practices" in servicing consumers' home mortgage loans, according to a U.S. Federal Trade Commission announcement today.

JPMorgan Chase & Co. acquired Bear Stearns earlier this year -- a deal that the Federal Reserve assisted through a $30 billion credit. Bear Stearns and EMC did not admit wrongdoing in the settlement. The FTC complaint had charged that the companies violated the FTC Act, the Fair Debt Collection Practices Act, the Fair Credit Reporting Act and a regulation of the Truth in Lending Act.

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