Whistle-blowers awarded $170 million

On Behalf of | Dec 29, 2014 | Whistle-blower Claims

People in Wisconsin may be interested in the outcome of the huge Bank of America and Countrywide whistle-blower case that was settled in August 2014. According to unsealed court documents, three individual whistle-blowers and one small New Jersey mortgage company were awarded $170 million as part of Bank of America’s $17 billion settlement in relation to the case. The man who initially blew the case open, a former property appraisal company employee, will receive $56 million, while a former Countrywide executive will receive $58 million. A former Countrywide manager will receive $48 million, and the mortgage company will receive $8.5 million.

Bank of America and Countrywide together approved mortgages for people who were not credit worthy, then sold low quality loans to federal insurer mortgage backers Freddie Mac and Fannie Mae. The scheme was exposed after the former property appraisal company employee came to Bank of America following the bank’s purchase of Countrywide. The man noticed the bank was routinely inflating appraisal values for properties in order to justify approving loans for people who were poor credit risks.

When the man tried to change this practice, the bank reacted by attempting to force him out. He found a whistle-blower attorney for help. The lawyer helped investigate the case and was able to get the Justice Department involved. The settlement amount was made under the federal False Claims Act.

In order to build a whistle-blower case, a lot of investigation must first occur. It is necessary to get the Justice Department involved for help in prosecuting the case. Whistle-blower awards are available through the False Claims Act to encourage people to expose fraudulent actions by their employers. While there are laws in place to prevent retaliation by employers, the practice still remains. People who have been retaliated against for exposing workplace fraud may want to consult with an employment law attorney.

Source: The New American, “Whistleblowers Share Over $170M in Bank of America Settlement“, Bob Adelmann, December 22, 2014


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