Consumer complaint received 2024-11-09 00:00:00
Product: Payday loan, title loan, personal loan, or advance loan — Personal line of credit
Issue: Problem with additional add-on products or services — 
Company: NEW YORK COMMUNITY BANCORP INC
State: CA

Complaint narrative:
I applied for a XXXX  loan with Flagstar Bank NA around XX/XX/XXXX. XXXX of the requirements to be approved was to hire a XXXX XXXX, therefore I hired XXXX XXXX XXXX  XXXX. The construction of the house began in XX/XX/XXXX. Throughout the process of the construction, XXXX draw requests were submitted to Flagstar Bank requesting funds to be released to finance the project. Draw requests were forms that were to be signed by both XXXX XXXX and XXXX and I, in order for Flagstar Bank to disburse the funds. In XX/XX/XXXX, after putting information in chronological order due to the breach of contract and thinking of seeking legal matters against XXXX XXXX and XXXX, I realized that 6 out of the 7 draw requests that were approved from the bank had a forged signature, and that three that were sent to me by the contractor to sign, only one had been submitted. I immediately contacted Flagstar Bank to notify them of my findings, and they advised me to seek legal advice. Thereafter, a police report was made ( XX/XX/XXXX ). As a side note, even though I was receiving emails from the draw team, it never crossed my mind how the draw requests were being approved, and nonetheless did I think forgery was going on. Throughout the construction I called the draw analyst from Flagstar Bank multiple times asking for help so they could talk and push XXXX XXXX XXXX XXXXXXXX to move on with the build, but nothing was ever done on their end. In addition, while XXXX XXXX XXXX XXXX  was the contractor I had to ask Flagstar Bank for 4 three-month loan extensions, causing me more stress since I was worried about probably having to pay a {$700.00} fee per extension. Flagstar Bank didn't advocate for me because despite the numerous loan extensions, only about XXXX % of the work was done and more than XXXX  % of the funds had been withdrawn. 

Due to the negligence and breach of contract from XXXX XXXX XXXX XXXX the lack and unavailability of finishing the construction, I was forced to seek remedy and hire a competent XXXX XXXXXXXX ( XXXX XXXX XXXX ). Flagstar Bank also made it a requirement to hire a general contractor to be able to disburse the remanding funds left in the construction loan. A couple months went by, and the construction was complete ( XX/XX/XXXX ). XXXX XXXX XXXX and I submitted the last draw request to Flagstar Bank, and on XX/XX/XXXX, Granite Risk Management that forms part of Flagstar Banks draw team, sent an email notification to the owner of XXXX XXXX XXXX XXXX despite the fact they were made aware of the new contractor I had hired. 

Flagstar Disbursed the remaining funds of {$74000.00} in XX/XX/XXXX from the construction loan. I attempted to cash the check at XXXX XXXX  XXXX, with both XXXX XXXX XXXX signature and my own ; however, XXXX XXXX  refused to cash the check and educated me on what avenues I had to take to cash a joint check with proper endorsement. Thanks to the education that XXXX XXXX  provided me on cashing a joint check, I went back to my records to review the form of payments that were disbursed and realized that XXXX XXXX XXXX XXXX  received the disbursement via XXXX joint checks that I don't recall seeing. I reached out to Flagstar Bank XXXX XXXX, to make them aware of the forgery and asked for a copy of the back of the cashed checks. On XXXX XXXX I received the copy of the back of these checks and found that these checks were cashed with a forged endorsement and/or missing endorsement. 

On XXXX XXXX a notarized forgery affidavit of check fraud was completed at a Flagstar Bank location. On XXXX XXXX XXXX Banks check fraud claim analyst reached out to me to begin the investigation. It was found that XXXX XXXX XXXX  was the bank that cashed these checks and neglected their due diligence when cashing XXXX joint checks. Per the back-and-forth conversation Flagstar Bank was going to make XXXX XXXX liable for the checks. On XX/XX/XXXX, my attorney and I received a letter that was sent to the owner of XXXX XXXX XXXX XXXX that funds were going to be withdraw from his account because Flagstar Bank NA requested reimbursement because Forged Endorsement, however I never received any funds. In XX/XX/XXXX I reached out to the Check Fraud Claim Analyst with Flagstar Bank twice via email and called her multiple times but I was not getting a response back. When I called the Check Fraud Claim Analyst at Flagstar Bank, I would get a message stating the Flagstar Number has been disconnected. I then reached out to a Flagstar Branch manager on XXXX XXXX asking for an update since the Check Fraud Claim Analyst wasn't reachable. The branch manager sent out an email to other Flagstar Employees and received a response that my claim was going to be denied and that I would receive a letter in the mail with an explanation of why. As of XXXX XXXX, I have not received either a letter, call or email from Flagstar Bank with an update on my claim. Ive emailed the branch manager, who has sent a couple emails asking for an update, however, I havent received a response. 

The following are the dates and amounts of the checks that were cashed with a forged and/or missing endorsement. 

XX/XX/XXXX for {$20000.00} cashed with a forged endorsement XX/XX/XXXX for {$25000.00} cashed with a forged endorsement XX/XX/XXXX for {$17000.00} cashed with a forged endorsement XX/XX/XXXX for {$26000.00} cashed with a missing endorsement. 

XX/XX/XXXX for {$34000.00} cashed with missing endorsement. 

Total amount : {$120000.00} See ; Forgery, California Penal Code 470 UCC 4-401 Flagstar Bank NA neglected their examination on the signatures of the draw requests, and the checks. As the middleman, Flagstar Bank, should have been more aware of these financial transactions and been more aware of the signatures on the draw request. 

XXXX XXXX XXXX, in addition, also neglected their examination and analysis on proper joint check endorsement prior to cashing 5 checks on 5 different occasions.

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