The Real Estate Bloggers

5 Top Lenders Accused of Defrauding Taxpayers With Handling of Foreclosures

Posted: 17 May 2011 07:39 AM PDT

Charlie_brown_lucy_football A bombshell report has leaked that 5 of the top mortgage lenders, Bank of America, JPMorgan Chase, Wells Fargo, Citigroup and Ally Financial, have been audited and serious acts of fraud against the taxpayers of the United States have occurred. The banks were audited in February and March of this year, just after they completed a foreclosure moratorium to fix issues they had in their processing.

The reports stated that the banks cheated taxpayers by filing false claims with the Federal Housing Administration by seeking reimbursements “on foreclosed homes that sold for less than the outstanding loan balance using defective and faulty documents.” via Huffington Post

The five separate investigations were conducted by the Department of Housing and Urban Development’s inspector general and examined Bank of America, JPMorgan Chase, Wells Fargo, Citigroup and Ally Financial, the sources said.

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 federal audits mark the latest fallout from the national foreclosure crisis that followed the end of a long-running housing bubble. Amid reports last year that many large lenders improperly accelerated foreclosure proceedings by failing to amass required paperwork, the federal agencies launched their own probes. via The HuffingtonPost

Thanks for reading this post. If you would like to see more articles like this, please come visit The Real Estate Bloggers. where it was originally published.

5 Top Lenders Accused of Defrauding Taxpayers With Handling of Foreclosures