“God help any bank that takes this case to trial,” Burns said.
“A jury’s only question is going to be ‘How much do they have?’ ”
Suit alleges banks and mortgage companies cheated veterans and U.S. taxpayers
Some of the nation’s biggest banks and mortgage companies have defrauded veterans and taxpayers out of hundreds of millions of dollars by disguising illegal fees in veterans’ home refinancing loans, according to a whistleblower suit unsealed in federal court in Atlanta.
The suit accuses the companies, including Wells Fargo, Bank of America, J.P. Morgan Chase and GMAC Mortgage, of engaging in “a brazen scheme to defraud both our nation’s veterans and the United States treasury” of millions of dollars in connection with home loans guaranteed by the Department of Veterans Affairs.
“This is a massive fraud on the American taxpayers and American veterans,” James E. Butler Jr., one of the lawyers bringing the suit, said Tuesday.
Tens of thousands of the VA loans have gone into default or resulted in foreclosures, resulting in “massive damages” to the U.S. government, the suit alleges. The faulty loans will cost taxpayers hundreds of millions of dollars, with the costs rising as more VA loans go into default, according to the suit.
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Other companies named as defendants include CitiMortgage, Washington Mutual Bank, PNC Bank (which acquired National City Mortgage), Countrywide Home Loans, Mortgage Investors, First Tennessee Bank (which acquired First Horizon Home Loan), Irwin Mortgage and New Freedom Mortgage.
Full complaint below…