Consumers don’t have to prove they were overcharged in order to sue settlement services providers for triple damages under the Real Estate Settlement Procedures Act (RESPA), a federal court of appeals has ruled in a precedent-setting decision involving allegations of "captive reinsurance" of private mortgage insurance (PMI) policies.

The decision exposes Countrywide Financial Corp. owner Bank of America to potential damages of nearly $2.7 billion. Countrywide is accused in a proposed class-action lawsuit of funneling business to private mortgage insurers who had agreed to reinsure policies with an affiliated company, Balboa Reinsurance Co.

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