A whistleblower recently received $9.4 million for the role she played in identifying misconduct at PHH Corp, a mortgage lender based in New Jersey. The corporation will be responsible for paying $74.5 million to resolve claims that the company’s loan practices put the government and borrowers at risk.
The settlement was announced by the U.S. Department of Justice. It resolved the allegations against PHH that the corporation did not comply with federal requirements for any loans issued, guaranteed or purchased by specific federal agencies. According to the Justice Department, in the five-year period between 2006 and 2011 PHH certified numerous ineligible loans for Federal Housing Administration insurance, which set the government up for some significant losses when it paid out insurance claims on those mortgages.
Government programs offered by the Federal Housing Administration, Veterans Administration, Fannie Mae and Freddie Mac that are designed to assist homeowners depend on lenders to only approve eligible loans. PHH’s alleged admission of ineligible loans put these government programs at risk.
By accepting the settlement offer, PHH admitted to no wrongdoing in the case.
Whistleblowers can earn significant money in settlements
Whistleblowers who are aware of internal wrongdoing in their companies or in government agencies stand to earn a significant amount of money if they report this wrongdoing to the government and it results in successful enforcement actions. The whistleblower in this incident provided information that was clearly of use to the government as it investigated the case.
To learn more how to proceed with a whistleblower claim, speak with a skilled Dallas attorney at Whistleblower Law for Managers.