Countrywide protected fraudsters by silencing whistleblowers (Michael Hudson)

[chill_wind]

"iWatch News tells the story of a pattern of fraud at Countrywide Financial Corp., once the nation’s largest mortgage lender, and a high-ranking executive who blew the whistle and, she claims, was fired for her trouble. The story is the product of a 10-month investigation that included review of thousands of pages of court documents and interviews with former company insiders."

Countrywide protected fraudsters by silencing whistleblowers, say former employees
Mortgage industry whistleblower wins case against Bank of America
By Michael Hudson
September 14, 2011

A high-level executive who reported corrupt lending practices at Countrywide Financial Corp. was improperly fired for leading internal investigations that “revealed widespread and pervasive wire, mail and bank fraud” at the lender, a federal agency ruled Wednesday.

In the summer of 2007, a team of corporate investigators sifted through mounds of paper pulled from shred bins at Countrywide Financial Corp. mortgage shops in and around Boston.

By intercepting the documents before they were sliced by the shredder, the investigators were able to uncover what they believed was evidence that branch employees had used scissors, tape and Wite-Out to create fake bank statements, inflated property appraisals and other phony paperwork. Inside the heaps of paper, for example, they found mock-ups that indicated to investigators that workers had, as a matter of routine, literally cut and pasted the address for one home onto an appraisal for a completely different piece of property.

Eileen Foster, the company’s new fraud investigations chief, had seen a lot of slippery behavior in her two-plus decades in the banking business. But she’d never seen anything like this.

“You’re looking at it and you’re going, Oh my God, how did it get to this point?” Foster recalls. “How do you get people to go to work every day and do these things and think it’s okay?”

(5 pages)

http://www.iwatchnews.org/2011/09/22/6687/countrywide-protected-fraudsters-silencing-whistleblowers-say-former-employees

[formercia]

1. It's pretty simple

You pay them Bonus Money and tell them the more they play, the bigger the Pay. It's human Nature.

Nobody wants to see their Bonus check cut.

[gratuitous]

2. There ya go

The mortgages couldn't be written fast enough, the money and commissions were just rolling in, and the paperwork would get caught up at the end of the week. Or the end of the month. Or by the end of the year, surely. And don't be nagging me in the meantime! My phone's ringing, and there's more money to be made.

[chill_wind]

3. They tangled with the wrong woman, btw.

She won her case against them for almost $1 million and the right to be reinstated at her job.

Department of Labor guarantees Bank of America whistleblower nearly $1M

http://www.iwatchnews.org/2011/09/14/6467/mortgage-industry-whistleblower-wins-case-against-bank-america

Of course...

"Bank of America said it plans to appeal the ruling."