Wells Fargo has reached a tentative $1.2-billion settlement with the federal government to resolve claims that it engaged in mortgage fraud and wrongful Federal Housing Administration (FHA) loan underwriting practices in the lead-up to the 2008 financial crisis and housing market crash. It's been a tough week for the San Francisco-based company, as just days ago, a California judge certified two class-action lawsuits accusing Wells Fargo of failing to meet its obligations to struggling borrowers who sought to modify their home loans. Now, the country’s largest mortgage lender said in a Feb. 1 Securities and Exchange Commission filing that it has reached "an agreement in principle” with the Department of Justice, the U.S. Attorney’s Offices for the Southern District of New ...
- The government accused Wells Fargo of "reckless" lending practices during the housing market crisis, and said "pay up" to the tune of $1 billion-plus.
- The proposed settlement would put all claims against the company to rest, but Wells Fargo noted "there can be no assurance" that the agreement is final.
- Similar claims have been made against Bank of America, Citigroup and JPMorgan Chase, and they all settled -- leaving QuickenLoans more or less as the sole company still fighting this battle.
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