![]() The defective loans falsely represented details regarding credit-worthiness, employment status and income, and the source of down payments, Vance said. The scheme resulted in the sale of hundreds of millions of dollars worth of fraudulent loans to Fannie Mae between 2005 and the first quarter of 2010, Vance said. “The irony of this case is the majority of the loans originated by Abacus have continued to perform, which means the monthly mortgage payments are being made by the borrowers,” Vance said at a news conference in New York. Unlike the widespread defaults that led to foreclosures during the crisis, most of the loans Abacus originated have not defaulted, prosecutors said. Law enforcement authorities have been criticized for their failure to bring criminal charges against major banks for the roles they played in causing the crisis. Widespread mortgage fraud led to the financial crisis in 2008. The bank said its loan default rate is one of the lowest in the country: Less than one-half of 1 percent compared to the current national average of more than 5 percent. Neither Fannie Mae nor the borrowers were ever harmed.” “Moreover, the only victim in this matter is the bank itself. “There is no evidence that any senior executive at the bank engaged in illegal behavior,” the statement said. The bank uncovered the irregularities more than two years ago, conducted an internal investigation and reported the results to authorities, the statement said. The charges include grand larceny, conspiracy, residential mortgage fraud and falsifying business records.Ībacus said in a statement it was “disappointed” New York prosecutors decided to indict the bank. ![]()
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