WASHINGTON (CN) – Suntrust Mortgage will pay the federal government and 49 states $968 million to settle charges of abusive mortgage practices, according to a settled federal complaint.
The payments include $418 million in penalties for violating standards on loans back by the Federal Housing Administration; $500 million in relief to homeowners; and $40 million to people who lost their homes to foreclosure.
Among the charges in the settled complaint are that SunTrust “knowingly presented or caused to be presented to the United States false or fraudulent claims for payment or approval, including but not limited to improper claims for payment of FHA residential mortgage insurance or guarantees.”
“In so doing, the defendant acted knowingly; that is, defendant possessed actual knowledge that the claims for payment were false or fraudulent; acted in deliberate ignorance of the truth or falsity of the claims for payment; or acted in reckless disregard of the truth or falsity of the claims for payment.”
Suntrust was the 14th largest mortgage originator in the country during the period at issue.
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