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Whistleblower Lawsuit Alleges Banks Cheated Veterans

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A whistleblower lawsuit bought under the Federal Claims Act, by two mortgage brokers, has been unsealed in Atlanta federal court, and claims that 13 banks and mortgage companies defrauded military veterans and taxpayers out of hundreds of millions of dollars, by over charging veterans who applied for special loans guaranteed by the Department of Veteran Affairs.

The lawsuit targets numerous firms including JPMorgan Chase & Co., Bank of America, and Wells Fargo. According to the lawsuit, these firms charged attorney fees and settlement closing costs, which are prohibited by federal laws, and hid them by calling them title examination and title search fees.

“This is a massive fraud on the American taxpayers and American veterans,” one of the attorneys who brought the case. “Knowing they weren’t allowed to charge the fees, the banks and mortgage companies inflated allowable charges to hide these illegal fees without telling the veterans who were the borrowers or the VA they were doing so.”

The lawsuit says that nearly 1.2 million refinanced loans made over the last decade have been made by veterans and their families, and that nearly 90 percent of them were included in the fraudulent acts. The firms involved collected $300 to $1,000 with each deal, amounting to “massive damages” to the federal government.

The lawsuit seeks to recover damages and penalties on behalf of the federal government.

 

breakinglawsuitnews.com disclaimer: This article: Whistleblower Lawsuit Alleges Banks Cheated Veterans was posted on Wednesday, October 5th, 2011 at 8:19 pm at breakinglawsuitnews.com and is filed under Fraud Lawsuits.

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