Volume 28 - Number 37
September 29, 2011
FHA Can’t Stop Officers of Firms with Unresolved Indemnification Pacts from Reentering Market
Former executives of mortgage companies that failed to indemnify the Department of Housing and Urban Development on FHA losses are back in business – and the FHA can’t do a thing about it, according to HUD’s internal watchdog. In a new report, the HUD Office of the Inspector General said it found at least 12 corporate officers back in the business of originating FHA-insured mortgage loans after leaving their previous employers, all of which failed to honor their indemnification agreements with HUD. The seven lenders identified in the OIG audit had lost their FHA approval and are no longer in business. The OIG said...
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