Lawsuit Charges Colorado Lender Fired Whistleblowing Employees

Jun 09, 2017

Swiss-based bank UBS’ announcement that the Department of Justice (DOJ) was preparing a civil action related to 40 residential mortgage-backed securities (RMBS) deals from 2006 through 2007 came to fruition sooner than later

Four ex-employees of Aurora, Colo.-based American Financial Corp. have filed a lawsuit claiming the company fired them after they sought to expose alleged evidence of mortgage fraud.

According to a Denver Post report, the lawsuit stated that American Financial allegedly submitted faked documents and consumer loan applications to least five financial institutions—
JP Morgan Chase, Wells Fargo, US Bank, Flagstar Bank and PennyMac—and other institutions including the Colorado Housing and Finance Authority. The employees—three mortgage consultants and a pre-qualification specialist—said they were suspended and later fired for sharing their concerns with company management.

The company issued a statement refuting the lawsuit’s claims. “We plan to file a motion to dismiss some of the claims in the lawsuit,” the company statement said. “We are in good standing with mortgage licensing authorities here in Colorado and across the United States.”

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Phil Hall

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Jun 09, 2017

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