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Allied Home Mortage

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Jury Awards $93 Million in Federal Fraud Case Against Allied Home Mortgage

A federal jury has ordered two Texas-based home mortgage companies and their chief executive to pay nearly $93 million for defrauding the government by issuing improper and risky home loans that later defaulted.

The companies, formerly known as Allied Home Mortgage Capital Corp. and Allied Home Mortgage Corp, and their founder, Jim C. Hodge, were the subject of July 2010 stories by ProPublica , which detailed a trail of alleged misconduct, lawsuits and government sanctions spanning at least 18 states and seven years. Borrowers said they’d been lied to by Allied employees, who in some cases had siphoned loan proceeds for personal gain. Some borrowers had lost their homes.

Despite the years of warnings, the federal government didn’t restrict Allied’s ability to issue mortgages until 2011, when prosecutors intervened in a pending whistleblower case and sued Hodge and both Allied companies in U.S. District Court in Manhattan. Simultaneously, the U.S. Department of Housing and Urban Development suspended Allied and Hodge from issuing loans backed by the Federal Housing Administration. Allied was also barred from issuing mortgage-backed securities through the Government National Mortgage Association (Ginnie Mae).

Allied Home Mortgage, CEO Ordered to Pay $92M For FHA Fraud

A federal jury unanimously found Allied Home Mortgage and its president and CEO Jim Hodge liable for civil mortgage fraud last week, reports HousingWire staffer Ben Lane.

The government filed a lawsuit five years ago against Allied, its entities, and Hodge, alleging that the Allied Home Mortgage Capital Corporation, at Hodge’s direction, committed repeated violations of the False Claims Act and the Financial Institutions Reform, Recovery, and Enforcement Act by falsely certifying the quality of loans insured by the Federal Housing Authority, as well as violating several FHA lending rules, according to Lane.

The jury found that Allied Home Mortgage and Hodge did indeed commit False Claims Act violations and FIRREA violations and awarded the United States a total of $92,982,775 in damages, including $7,370,132 against Hodge.

While it’s a far cry from the $834 million the government initially sought, the damages are eligible for trebling under the terms of the False Claims Act, meaning it could rise to as high as $279 million.

Does the EU subsidize your gas/mortage/electric bills? So why does Obama think the EU is the solution?

to America's problems?

How, exactly, will this help America?

I think he is full of sh*t!

Everytime I hear his goofy mulatto a$$ speak, with his pausing and choosing his words while swinging his head from side to side like a monkey it makes laugh!