Back in 2006, relators Victor Bibby and Brian Donnelly filed a massive eight-defendant FCA case against a number of banking entities alleging widespread fraud against veterans seeking VA mortgages.
DoJ did not join any of these cases.
Now, 12 years later, Wells Fargo is the 7th defendant to come to the table, and has agreed to pay $108 million to settle their portion of the case.
Previous settlements in the declined FCA cases initially filed by relators Bibby and Donnelly total more than $161 million:
• JPMorgan Chase - $45 Million (March 13, 2012 )
• Countrywide Home Loans, Inc. - $45 Million (November 19, 2012)
• PNC Bank - $38 Million (November 19, 2012)
• First Tennessee Bank - $16 Million (November 19, 2012)
• SunTrust Mortgage - $10.2 Million (November 19, 2012)
• CitiMortgage - $7.5 Million (November 19, 2012)
The fraud, in a nutshell, involved banks adding unallowed attorney fees to title examination costs on mortgage closing documents. Under VA rules, low-cost loans to veterans are not supposed to include attorney’s fees.
Is this case over yet? Nope! One more very big plaintiff -- Mortgage Investors Corporation ("MIC") -- is still in the crosshairs.