MetLife’s home lending unit will pay $123.5 million to end the ongoing investigation into the company’s giving of government-backed mortgages to folks who didn’t meet federal requirements. According to the Justice Department, MetLife knew the business was issuing hundreds of loans that didn’t meet federal requirements. That meant the loans weren’t eligible for insurance by the Federal Housing Authority. But MetLife made the mortgages anyway. The FHA and taxpayers were the losers when defaults—as should have been expected—resulted.
During some periods between January 2009 and August 2010, according to the Justice Department, MetLife Bank knew that a majority of the loans it was originating had material or significant deficiencies. While those rates improved later, MetLife also altered its practices so fewer mortgages appeared to be deficient. The Justice Department says MetLife Bank’s CEO, board of directors, and other members of senior management were aware that many of the mortgages didn’t meet government standards.
MetLife says it cooperated with the investigation and set aside money for the settlement. The New York-based company got out of the business in 2012. MetLife Bank was also among 16 major mortgage lenders and servicers cited by U.S. regulators in April 2011 for improperly foreclosing upon homeowners in 2009 and 2010. The Federal Reserve imposed $3.2 million in penalties against MetLife.
Source: Insurance Journal
Contact us today for a free legal consultation with an experienced attorney.
Fields marked *may be required for submission.
If you would like to subscribe to the Jere Beasley Report digital edition, simply visit our Subscriptions page and provide the necessary information or call us at 800-898-2034.
Attorney Advertising - Prior results do not guarantee a similar outcome.