A whistleblower with a track record of wresting large settlements from banks is suing 22 companies for allegedly filing fraudulent mortgage documents with the Department of Housing and Urban Development.
The lawsuit is a stark reminder that banks still face massive litigation and potential settlements for wrongdoing from the mortgage boom and financial crisis. On Wednesday, JPMorgan Chase acknowledged that it violated the False Claims Act and agreed to pay $614 million to settle claims that it improperly approved Federal Housing Administration and Veterans Affairs loans that did not meet underwriting standards.
Banks can be held liable for treble damages under the False Claims Act if they are found to have "falsely certified" that mortgages met all FHA requirements. The act also gives whistleblowers the right to file suit on behalf of the government.
“It’s been very difficult to uncover how fraudulent documents were created and spread through the system,” says Reuben Guttman, Szymoniak’s attorney at the firm of Grant & Eisenhofer. “Lynn Szymoniak did the original analysis, looked at documents and put the pieces together in a way that nobody else did.”
The new lawsuit was filed in the U.S. District Court in South Carolina. Several of the defendants, including Deutsche Bank and Wells Fargo, said they are reviewing the lawsuit and could not immediately comment.
Justia > Dockets & Filings > Fourth Circuit > South Carolina > South Carolina District Court > USA et al v. American Home Mortgage Servicing Inc et al
|Plaintiff:||USA, Lynn E Szymoniak, California, State of, Delaware, State of, Florida, State of, Hawaii, State of, Illinois, State of, Indiana, State of, Massachusetts, State of, Minnesota, State of, Montana, State of, Nevada, State of, New Hampshire, State of, New Jersey, State of, New Mexico, State of, New York, State of, North Carolina, State of, Oklahoma, State of, Rhode Island, State of, Virginia, State of, Columbia, District of, Chicago, City of and New York, City of|
|Defendant:||American Home Mortgage Servicing Inc, Saxon Mortgage Services Inc, Lender Processing Services Inc, Docx LLC, CitiMortgage Inc, Wells Fargo Home Mortgage, Bank of America Corporation, Bank of New York Mellon Corporation, Citibank National Association, Deutsche Bank National Trust Company, Deutsche Bank Trust Company Americas, HSBC USA National Association, JP Morgan Chase Bank National Association, US Bank National Association and Wells Fargo Bank National Association|
|Filed:||June 4, 2010|
|Court:||South Carolina District Court|
|Office:||Rock Hill Office|
|Presiding Judge:||Joseph F Anderson|
|Nature of Suit:||Other Contract|
|Cause of Action:||31:3729|
|Jury Demanded By:||Plaintiff|
Available Case Documents
|Date Filed||#||Document Text|
|August 2, 2013||149||Order to Unseal Case directing the complaints be unsealed and served upon the defendant by the relator and the relators serve this Order and the Notice of The United States That It Is Not Intervening At This Time upon the defendants only after service of the complaint. Signed by Honorable Joseph F Anderson, Jr on 08/02/2013. (bshr, )|
|January 22, 2014||266||ORDER denying 264 Motion to Bifurcate Motions to Dismiss, to Stay Non-Jurisdictional Portions of the Motions, and for Leave to File an Amended and Consolidated Complaint, denying the request to bifurcate the motions to dismiss, denying the request to stay the non-jurisdictional motions, and noting that the Relator is still within her 21-day grace period to amend her complaint once as a matter of course under Rule 15(a)(1)(B). Signed by Honorable Joseph F. Anderson, Jr. on 01/22/2014.(bshr, )|
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