Lending giant CEO says company won’t settle with DOJ

by Ryan Smith10 May 2016
The head of Quicken Loans says the lending giant has no intention of settling with the government over allegations of filing false claims on federally insured mortgages.

Last year, the Justice Department accused the lender of submitting claims for hundreds of improperly underwritten FHA-insured loans. Quicken Loans isn’t the first lender the DOJ has gone after for this issue, and the agency has so far recovered more than $100 million in settlements. But Quicken Loans CEO Bill Emerson told CNBC his company won’t be settling.

“For us, it’s not something we can even begin to stomach,” Emerson said on CNBC’s Squawk Box. “(To look our 12,000 team members in the eye and say, ‘Guess what, we committed fraud against the United States government … we didn’t. We won’t say it.”

Emerson said that although Quicken Loans underwriters had occasionally made simple errors, that wasn’t the same thing as conscious fraud.

“An example, we miscalculated income by $2.10. We over-lent somebody by $26 on a loan program,” Emerson told CNBC. “Those are the type of things the Department of Justice is saying is committing fraud against the United States government. And it’s just dead wrong.”


  • by Anonymous | 5/10/2016 11:23:48 AM

    While I see his point and agree with him, I definitely think it is super risky to be riding the DTI line to that extreme! Clearly that wasn't a DU approved mortgage file and it was a manual FHA underwrite. Those are riskier mortgages to begin with, and then to completely max the mortgage amount based on the DTI, so that $2.10 made it go out of compliance is dumb. I'm sorry but come on, guys! The LO and the UW pushed that mortgage to the very max if two bucks was all it took to kill it. Two dollars?

  • by | 5/10/2016 11:32:12 AM

    I agree. These guys are trying to corner the market with all the marketing. All of that marketing costs money so they are forced to max every deal out. They will fail just like all the others before them who attempted to run none stop commercials. Remember Ditech?? Or even before them First Plus Financial with Dan Moreno..History always repeats itself in this business.

  • by John L | 5/10/2016 12:51:34 PM

    I am in favor of breaking up big lenders. They have a monopoly on the market and that leads to widespread abuse.


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