Today the U.S. government filed a $1 billion suit against Deutsche Bank AG alleging that the bank knowingly lied to federal officials in order to obtain federal insurance guarantees on mortgage debt. In its complaint, the U.S. accuses Deutsche Bank and its MortgageIT Inc. unit of misleading officials into believing that Deutsche Bank mortgages qualified for federal mortgage insurance programs, a step toward making the mortgages much more attractive to potential investors in order for the bank to reap "substantial profits" when the loan were subsequently sold. In a ten year span, 1999-2009, Deutsche Bank and MortgegIT approved more than $5 billion in mortgages for Federal Housing Administration Issurance.
Deutsche Bank is accused of violating program rules by choosing mortgage "in blatant disregard" of whether borrower could make payments. According to the complaint, the quality of the loans was so poor that one in three mortgages defaulted, resulting in $386 million dollars in claims already paid by the FHA with hundreds of millions of dollars more expected. The suit was brought under the federal False Claims Act and is believed to be the first lawsuit of its kind targeting a major bank.
Some industry insiders believe that this may be the first of many future lawsuit of its kind brought against some of the nations largest banks. If you are facing a Florida Foreclosure Lawsuit from Deutsche Bank, contact a Jacksonville Foreclosure Lawyer or a Florida Foreclosure Defense Lawyer today for a free consultation in order to determine what foreclosure defenses may be available to you.
Below is a copy of the U.S. Government's Complaint
United State of America vs Deutsche Bank and Mortgage It, Inc
