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Cunningham v. Nationscredit Financial Services Corp., 497 F.3d 714 (7th Cir. 2007); Cunningham v. Equicredit Corp. of Illinois, 427 F. Supp. 2d 838 (N.D. Ill. 2006)

The Seventh Circuit in this case rejected the plaintiff’s argument that the lender’s disclosures in connection with a home loan failed to comply with the Home Ownership and Equity Protection Act (HOEPA) amendment to the Truth in Lending Act.  At issue was whether a portion of loan proceeds stolen by the loan broker had to be included in the lender’s calculation of total points and fees and whether the lender had a duty to ensure that the loan broker did not abscond with money disbursed to a home improvement contractor.  The Seventh Circuit agreed with VBLH&C: the stolen money did not constitute points and fees, and the lender owed no duty to protect the borrower from an unscrupulous broker.  Accordingly, the Seventh Circuit affirmed summary judgment for the lender.