According to CNN Money Dutch bank ABN AMRO’s U.S. mortgage division has been fined US$16.9 million in respect of false claims on federally insured home loans.
The Department of Urban Housing (HUD) said it discovered underwriting deficiencies and improper conduct by an ABN AMRO Mortgage employee in 2003, and alerted the company, which then launched an internal investigation.
ABN AMRO Mortgage found a number of employees falsely certified that two company underwriters had reviewed more than 28,000 loans prior to endorsement when they had not, HUD said.
The agreement settles allegations that ABN AMRO Mortgage made false certifications to HUD connected with more than 28,000 federally insured mortgages. The government said 229 of those mortgages led to defaults and resulted in losses to the housing agency of $6.25 million.
In addition ABN AMRO Mortgage has agreed to not submit hundreds of defaulted loans to the Federal Housing Administration insurance fund saving the Fund an estimated $24.35 million in losses.
The settlement with ABN AMRO’s mortgage unit follows an $80 million fine against the Dutch bank by U.S. bank regulators in December 2005 in connection with anti-money laundering violations including unauthorized financial dealings with Iran and Libya.
