Two former employees of Louisiana-based IberiaBank were awarded more than $2.3 million when the bank settled allegations that its mortgage unit made false claims for federal loan guarantees.
Kelley R. Shackleford and Karen Mills worked for IberiaBank in Little Rock, Arkansas.
They filed a lawsuit in federal court under the False Claims Act. The Act allows private citizens to sue on behalf of the government and share in any recovery.
Shackleford and Mills were awarded 20 percent of the government’s $11.7 million settlement with the bank.
Between 2005 and 2014, IberiaBank certified Federal Housing Administration mortgage loans for FHA mortgage insurance even though some of the loans weren’t eligible.
The bank was obligated to self report the violations but didn’t perform timely quality reviews.
Some loan files didn’t document or corroborate borrowers’ incomes and down payments and contained unresolved appraisal discrepancies, the DOJ said.
In 2010, after a HUD review, IberiaBank told the federal agency it had stopped paying illegal underwriter commissions. “However, the bank did not disclose to HUD that it was paying underwriters incentive payments and that it continued to do so through 2014,” the DOJ said.
IberiaBank Corp. operates through branches in Louisiana, Arkansas, Tennessee, Alabama, Texas, Florida, Georgia and South Carolina.
The FCPA Blog | Friday, 15 December, 2017