Confidential Federal Audits Accuse Five Biggest Mortgage Firms Of Defrauding Taxpayers [EXCLUSIVE]

[kpete]

Source: Huffington Post

The audits accuse the five major lenders of violating the False Claims Act, a Civil War-era law crafted as a weapon against firms that swindle the government. The audits were completed between February and March, the sources said. The internal watchdog office at HUD referred its findings to the Department of Justice, which must now decide whether to file charges.

....................

The resulting reports read like veritable indictments of major lenders, the sources said. State officials are now wielding the documents as leverage in their ongoing talks with mortgage companies aimed at forcing the firms to agree to pay fines to resolve allegations of routine violations in their handling of foreclosures.

The audits conclude that the banks effectively cheated taxpayers by presenting the Federal Housing Administration with false claims: They filed for federal reimbursement on foreclosed homes that sold for less than the outstanding loan balance using defective and faulty documents.

Two of the firms, including Bank of America, refused to cooperate with the investigations, according to the sources. The audit on Bank of America finds that the company -- the nation’s largest handler of home loans -- failed to correct faulty foreclosure practices even after imposing a moratorium that lifted last October. Back then, the bank said it was resuming foreclosures, having satisfied itself that prior problems had been solved.

Read more: http://www.huffingtonpost.com/2011/05/16/foreclosure-fraud-audit-false-claims-act_n_862686.html

[Demeter]

1. How do you stop an oncoming train?

and why would anyone want to stop this one?

[Javaman]

7. Blow up the tracks...

but no one has the guts to do that.

[Scuba]

2. Good. Nail these criminals. They'll all look good in...

http://imgur.com/dW11v>

[iwishiwas]

4. Looks like they are only going after fines.

[Scuba]

6. And that's a good place to start....

...there should be plenty of opportunities to prosecute these crooks. Getting some of the money back for the People would be good to do early in the process.


However, if the fines are a fraction of the loot, and no criminal charges are brought, I'll call the various DOJ's "complicit".

[IScreamSundays]

9. fines that will be equivalent to a small fraction of the

money they have stolen. There will never be any prosecutions. Go steal a chicken from the market and get caught, you will do jail time and pay restitution.

[geckosfeet]

3. Hmm. The plot thickens. When the banks start to offer million $$ bribes, errr, payoffs,

errr, compensation to the government and wrongly foreclosed homeowners, you know you have their attention.

Confidential Federal Audits Accuse Five Biggest Mortgage Firms Of Defrauding Taxpayers (EXCLUSIVE)

The agency’s review later expanded to flawed foreclosure practices. FHA, a unit of HUD, could still take administrative action against those firms for breaking FHA rules based on its own probe.

The confidential findings appear to bolster state and federal officials in their talks with the targeted banks. The knowledge that they may face False Claims Act suits, in addition to state actions based on a multitude of claims like fraud on local courts and consumer violations, will likely compel the banks to offer the government more money to resolve everything.

Attorneys general in numerous states, armed with what they portray as incontrovertible evidence of mass robo-signings from preliminary investigations, are probing mortgage practices more closely.

A review of about 2,800 loans that experienced foreclosure last year serviced by the nation's 14 largest mortgage firms found that at least two of them illegally foreclosed on the homes of "almost 50" active-duty military service members, a violation of federal law, according to a report this month from the Government Accountability Office.

[Hotler]

5. k&r n/t

[neoralme]

8. Why is Bank America allowed to continue to do business. They

are crooks. There is no question about it.

[lsewpershad]

10. Send them all to prison

Unless these thieves go to jail they will never learn. Just a fine will not be a deterrence as they will recoup the fines off the backs of john public

[Zorra]

11. A strongly worded letter will be issued shortly. nt

[truedelphi]

12. Thank you for this sad tale of life in America.

Steal a can of soup to eat some dinner, go to jail.

Swindle away the lifeblood of entire communities, and then line up for record bonuses.