(Reuters) ? The Massachusetts attorney general has filed a lawsuit against five large U.S. banks accusing them of deceptive foreclosure practices, a signal of ebbing confidence that a multi-state agreement can be worked out.
The lawsuit was filed in state court in Boston on Thursday against Bank of America Corp, JPMorgan Chase & Co Inc, Citigroup Inc, Wells Fargo & Co and Ally Financial Inc.
In October, Attorney General Martha Coakley said she was preparing to sue over unlawful foreclosures because she had lost confidence that a settlement could be achieved holding banks responsible for wrongful foreclosures.
Coakley's office said the lawsuit was filed after more than a year of negotiations between the banks and all 50 states.
The lawsuit accuses the banks of unlawful and deceptive conduct in the foreclosure process, including false documentation and robo-signing.
None of the banks was immediately available to comment on the lawsuit, filed in Suffolk Superior Court in Boston.
Coakley, who took office in 2007, has been aggressive in moving against Wall Street firms and U.S. banks to protect homeowners and investors. Overall, her office said it has secured more than $560 million in relief for investors and borrowers, while keeping more than 24,000 people in their homes.
In 2010, Coakley called on Bank of America and other banks to cease foreclosures amid allegations of mortgage servicing fraud and robo-signing.
In Coakley's lawsuit, the mortgage servicing units of the five banks are accused of taking shortcuts in dealing with a deluge of foreclosures following the 2008 financial crisis.
A settlement with all 50 states and federal authorities could help the banks move beyond the legal fallout that has dogged them since the peak of the financial crisis.
(Reporting by Tim McLaughlin in Boston; editing by John Wallace)
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