According to a recently unsealed qui tam case in the Southern District of New York, CitiMortgage continued to issue faulty loans backed by government insurers, even after it agreed to pay $158 million to settle similar allegations in February 2012. The complaint alleges that loan officers still fail to properly verify borrower qualifications and violate internal guidelines meant to ensure that loans are evaluated by impartial underwriters. According to the complaint, loan officers cherry-pick the underwriters most likely to approve their loans and, in some cases, have attempted to bribe underwriters.

These recent allegations were brought to light by CitiMortgage’s senior vice president and lending consultant, who says that his loan volume decreased when he refused to engage in questionable practices.

Read the entire article, “Whistleblower Says Citi Continues Reckless Mortgage Lending” (Law360 Subscription Required)
Read our post on Citi’s 2012 settlement, “Citi Mortgage to Pay $158.3 Million for Mortgage Lending Fraud”