Consumer complaint received 2023-05-26
Company: U.S. BANCORP
State: MO
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Trouble during payment process

Complaint:
Summary : US Bank mortgage paid funds out of my escrow to an insurance company I am not insured with. This overdrew my escrow. US Bank is not giving me my funds back and says I need to pursue the insurance company myself. The insurance company ( XXXX ) has not respond to my request for refund either. 

Detail : In XXXX I started shopping/getting quotes to possibly change both my auto and homeowners insurance. I received a quote from XXXX insurance, but after they sent me the policy documents for my signature, I saw that the policy showed the wrong effective date, and had some other false information that needed to be corrected. So I emailed XXXX with a list of changes needed and asked for new quotes. Later that night I logged into my mortgage servicer 's website ( US Bank ) and noticed that they paid a payment out of my escrow, equal to the amount of the quote I received from Farmers a few days earlier. This payment had overdrawn my escrow by almost {$1500.00}. 

I spoke with Farmers on XX/XX/XXXX, and told them that those funds needed to be returned to my mortgage account at US Bank, since I had not yet finalized the policy change. ( I had not received the new quote, I had not signed anything at all with XXXX, and even if I were to go through with the change, the effective date was to be more than nine weeks in the future, so they had no standing to bill my mortgage. ) I was told they would contact me the next day, but they did not. 

So on XX/XX/XXXX I called my mortgage servicer to request that they obtain a refund from XXXX. I was transferred around to multiple different departments, who all told me that because XXXX had my account number ( which I had provided to them in anticipation of finalizing the new insurance - before I received the error-filled policy documents ), that they had no further responsibility to verify the validity of the payment request before sending Farmer the payment from my escrow account. Apparently it is not their policy to verify that billings they receive from insurance companys are valid. As long as the insurance company has an account number, then they do not ensure that a policy has been agreed upon/signed. In a day and age where rampant hacking leads to constant fraud, they take no steps to protect their customer or do any due diligence before sending out a customer 's funds. The last person I spoke with at US Bank hung up on me. 

So I want to formally complain about US Bank. US Bank did not due their due diligence in protecting my funds. They did not ensure that the invoice from XXXX was legitimate, before paying it. And they will not return my funds to me. At this point I've made two additional attempts to contact Farmers, but they have not responded either, however I believe that US Bank 's failure to properly vet on a payment request from an insurer not previously associated with my account resulted in this loss and it should be US Bank that corrects it.

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation