U.S. Bancorp to Pay $200 Million to End Probe of FHA Loans
U.S. Bancorp agreed to pay $200 million to resolve federal claims that it misrepresented the quality of government-backed mortgages the company originated.
The agreement covers loans that Minneapolis-based U.S. Bancorp made from 2006 through 2011 that were backed by the Federal Housing Administration, the Justice Department said today in a statement.
“By misusing government programs designed to maintain and expand homeownership, U.S. Bank not only wasted taxpayer funds, but inflicted harm on homeowners and the housing market that lasts to this day,” Stuart F. Delery, assistant attorney general for the Justice Department’s civil division, said in the statement.
The Justice Department has been probing shoddy mortgages that helped fuel the financial crisis and caused losses for government agencies that backed the loans. SunTrust Banks Inc. agreed this month to pay $968 million to resolve federal and state probes that a unit misrepresented the quality of mortgages the bank originated and deceived homeowners on loans it serviced.
U.S. Bancorp previously disclosed potential claims tied to the probe and “cooperated fully with the DOJ,” the company said today in a separate statement.