BofA $1 Billion Whistleblower Also Faced Fraud Claims
The whistle-blower helping the U.S. government mount a $1 billion fraud lawsuit against Bank of America Corp. was himself accused of fraud by an investor in a financing company he co-founded, and now works at Fannie Mae (FNMA), one of two entities he claims the bank defrauded.
Edward O’Donnell sued Bank of America, the second-biggest U.S. lender by assets, in February under the False Claims Act, saying the bank’s Countrywide Financial unit, where he once worked, issued defective mortgages and sold them to Fannie Mae and Freddie Mac. Last month, the Justice Department joined his suit, making it the first time the U.S. has accused a bank of fraud over loans sold to the two government-sponsored mortgage- finance companies.
To make the case, the U.S. may have to confront its whistle-blower’s own tangled history. A year after leaving Countrywide, O’Donnell was sued by an investor in a deal organized by a commercial financing firm he co-founded. Bank of America may use that lawsuit, and O’Donnell’s job at Fannie Mae, to raise doubts about his credibility before a jury, according to Peter Hutt, a lawyer who defends whistle-blower cases.
“It could certainly be argued that the whistle-blower had an interest in making the allegation either to secure employment at Fannie Mae or making himself look good at Fannie Mae,” Hutt, a partner at Akin, Gump, Strauss, Hauer & Feld LLP in Washington, said in a phone interview.
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“issued defective mortgages and sold them to Fannie Mae ” This happened in one form or another by a multitude of actors, including those on the inside and the outside. Clearly Fannie Mae must have known giving 400K or more to people who may have been unemployed a month earlier was probably a bad idea, but they gave preference to the get rich quick scheme. They know it, we know it, everyone knows it. The fact a whistleblower is needed to mount an effective action suggests the action will fail, and that Justice isn’t really the end goal. After Enron, WorldCom, Tyco and all the crap that happened less than a decade before THIS crisis clearly shows this country has some catastrophically serious problems. Incidentally, the Banksters knew all about those theft riddled corporate disasters from the .com era. And then housing came along..
Curujious, what was the outcome of the suit against this whistleblower by the investor? Was he found to be guilty? Did he lose the suit or was it dismissed? I fail to see where a suit filed means ‘guilty’. This post would hold far more integrity if the result of that suit were identified. Otherwise, it’s just another one of the bankster’s plots to discredit the facts.