0
0
The good news (to some) is that DOJ’s lawsuit with a $1.27 billion penalty against Bank of America was tossed by the appeals court. The court also threw out the $1 million fine levied against former Countrywide employee Rebecca Mairone. Ironically, Rebecca is the only industry executive to have been named in a suit and penalized (almost) as a result of the 2008 financial crisis. A dubious distinction.
But, how about that whistleblower who brought the alleged BofA, via Countrywide acquisition, wrong actions to the attention of the DOJ? He was another Countrywide executive. He gets to keep the $57 million reward paid by the DOJ for spilling the beans. He could have paid Rebecca’s fine and still had plenty left over.
Edward O’Donnell gets to keep the reward because of a separate lawsuit brought against BofA for selling these so-called “toxic mortgages” to the GSEs. DOJ had put aside the $57 million from the major fine paid by BofA to settle that suit. Nice to see they were concerned about their snitch.
Interesting to me is that these whistleblowers seem to know about their companies wrongdoing, but while employed did nothing to stop it. Maybe, they did and were only taken seriously after DOJ got involved and offered a reward for the information leading to the big fines against large lenders.
BTW, you think Countrywide could have come up with a better name for a quick approval loan program than the “Hustle”? They should have paid a fine just for using that name.
Just goes to show, as I’ve said all along, everyone who works for you is now a partner by proxy. If things are being done wrong, you can bet your penalties that someone in our organization is aware of it. Somewhere down the line, that person may be a whistleblower looking for the big payday.
Don’t give anyone that opportunity. Have a comprehensive pre and post-closing QC process to ensure everything is being done correctly. When defects are identified, quickly do what needs to be done to correct the cause and then audit again to make sure it stays corrected. Don’t overlook the obvious, and look carefully for what might be hiding. Pay attention to employee and customer complaints.
Others, like the CFPB and DOJ, and those whistleblowers are paying attention.
