New York foreclosure firm admits to cheating Fannie Mae, VA out of millions
According to the complaint, the law firm appeared to only use its affiliated companies, a process server and a title search company, to serve process and perform title searches that were required to complete foreclosures on loans owned by Fannie Mae.
But instead of actually using its own companies, the law firm was accused of using third-party vendors to perform the majority of the work in question, applying “exponential” markups to the services performed, and billing Fannie Mae for the work, knowing that the government-sponsored enterprise would repay the firm for the services.
According to the complaint, the submission of those “fraudulently inflated expenses” caused Fannie Mae to pay out “millions of dollars” in falsely inflated foreclosure expenses.
This week, the firm admitted to the conduct as part of a $6.1 million settlement with the U.S. Attorney’s Office.