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Former Countrywide Employees Say Company Covered Up Fraud in Miami, U.S.

The news just keeps getting worse for Bank of America and its purchase of Countrywide in 2008.

A new report by says that 30 former Countrywide employees say the company was protecting officials who were committing fraud by silencing potential whistleblowers. The former employees allege that Countrywide executives encouraged or allowed them to commit and cover up fraud. This not only affected homeowners, but included falsified income documentation and other ways to steer borrowers into bad mortgages.

This is far from shocking to Miami foreclosure defense lawyers, who have been questioning the actions of the banks and their officials for years in defense of Miami homeowners. This new report, though, hopefully will shed light on the banks’ actions to judges who are making rulings on homeowners who are having their houses taken away in Miami foreclosure proceedings.

Corporate investigators in the summer of 2007 discovered piles of paper that were set to be shredded outside the offices of Countrywide bank branches. In the mounds of paper, they discovered that branch employees were creating fake bank statements, inflated property appraisals and other phony paperwork by using scissors, tape and correction fluid, the story reports. Investigators believe that what they found showed that workers routinely cut and pasted addresses on different pieces of paper to show appraisals.

Yet, the Bank of America’s chief investigator was getting resistance from the company after making the discoveries. One executive e-mailed dozens of workers warning them of the investigation. Officials didn’t allow them to interview senior managers. Instead, fill-in interviewees read from scripts that had been vetted by higher-ups before they were sent to investigators.

Branches were shut down and employees let go, but investigators suspected the main fraudsters were left unscathed. By fall 2008, after Bank of America acquired Countrywide, it fired the chief investigator, accusing her of “unprofessional conduct.” But the U.S. Department of Labor recently ruled she was fired as payback for her investigation and was awarded $930,000 plus reinstatement.

It seems that regulators have been oblivious to the problems going on with banks for far too long. If employees were allowed — and encouraged — to falsify documents related to homeowners, what else did they do?
From this report, it can be said that not only are homeowners’ foreclosure documents being mishandled and falsified, but also documents that relate to the original loan could have been altered to help the company and harm the homeowner.

Miami foreclosure defense lawyers must be called on to look into these claims. While some believe that a foreclosure case is as easy as open and shut, this simply isn’t the case. This story highlights the need for more scrutiny and more accountability for the banks that are ruining our economic situation.

A Miami homeowner shouldn’t be thrown to the curb when the bank can’t prove who owns the note, can’t show proper documentation and has altered documentation to benefit it and ruin the homeowner’s lives. They have rights that must be upheld and honored.

If you’re battling foreclosure in Miami or the surrounding areas, contact Jacobs Legal for a confidential appointment to discuss your rights. Call (305) 358-7991.

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