Countrywide Financial Corp Allegedly Covered Up Massive Fraud

A whistle-blower at Countrywide had uncovered serious wrongdoings within the company, conducting an internal investigation in 2007, finding that forgery of loan documents, manipulation of borrowers assets and income, manipulation of the company’s automated underwriting system and destruction of valid documents have been in place in at least offices of the company in Boston.

countrywide-financial

Countrywide had been forced to close three-quarters of its Boston branches following the investigation, closing 44 jobs, but the whistle-blower did not stop to uncover new fraudulent practices before the company fired her on allegations of harassment and misconduct. He then turned to the Department of Labor and the government agency had found he is improperly laid off, forcing Countrywide to reinstate him in addition to a compensation of $930,000.

The investigation unearthed criminal activities including production of fake bank statements and forced inflating of home appraisals were encouraged by top managers within the company, Countrywide’s top executives protected big loan producers who used fraud to put up big sales numbers, according to her report filed with the Department of labor. Additionally, the company decided not to inform investors when it discovered fraud or other loan-related issues.


Speak Your Mind

*