New York’s highest court has allowed the state to proceed with a lawsuit that accused First American Corp. and its eAppraiseIt unit of colluding with the former Washington Mutual Inc. to fraudulently inflate home values. The Court of Appeals rejected the Defendants’ argument that federal law precluded the state from pursuing claims alleging fraud and violations of real estate appraisal independence rules. The Court upheld a June 2010 ruling by an intermediate state appeals court. The eAppraiseIt unit is now part of CoreLogic Inc., which was created when First American split last year into that company and First American Financial Corp. Bogus appraisals were a huge part of the problems that caused the housing market collapse in this country. The practice was part and parcel of the scheme by a number of big banks and financial institutions to make big bucks over the bundling and sale of mortgages as securities.
Source: Insurance Journal
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