Taylor Bean & Whitaker Mortgage may pay the United States more than $320 million to resolve allegations that they violated the False Claims Act submitting false mortgage claims, Bloomberg Businessweek announced earlier this month.
The settlement would resolve allegations that Taylor Bean knowingly submitted fraudulent mortgages to the Federal Housing Administration (FHA) and the Department of Housing and Urban Development (HUD). Taylor Bean allegedly submitted false, fraudulent, incomplete, or even wholly fabricated information to pass loan applications through the process which determined whether or not a customer is qualified for the loan. In some instances, employees were allegedly ordered to close the loan without meeting conditions or were ordered to add additional files to an application after the loan had closed. When these loans went into default, Taylor Bean allegedly presented these claims to the government in full knowledge that they were false and based on false information. The fraud caused the government to guarantee loans that it otherwise would not, and to pay money that it did not owe.
Subsequently, six Taylor Bean executives were convicted and jailed for their roles in bankruptcy fraud after the initial FCA charges were made, including former chairman Lee Farkas, who is currently serving a 30-year prison term for conspiracy and fraud.
The lawsuit was originally filed by two former employees, under the whistleblower provisions of the False Claims Act. The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery. The whistleblowers, who asked not to be named because the agreement was still being circulated among the parties, have not yet received a determined amount for their involvement in this settlement.
The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments. We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud. Read more about our expertise in False Claims Act cases and how you can take action.