Mortgage Brokers Turn Millionaires in Veteran Settlement

by 22 Mar 2012

(CNBC) --  At least on paper, two mortgage brokers in Georgia became instant millionaires last week with JPMorgan Chase’s settlement of their whistleblower lawsuit against the bank. After six years in secretive litigation, however, the two men, Victor Bibby and Brian Donnelly, say they’re simply relieved the first settlement is behind them. “It takes a lot of pressure off, that’s for sure,” Bibby told CNBC in an interview at his attorney’s office in Atlanta Tuesday.

“I mean, we’ve been living with unbearable pressure for six years, been like we’ve been in a cooking pot for six years. So yeah, it’s a big relief.” The two will share 26 percent of JPMorgan’s $45 million settlement, or just over $11 million. After splitting the proceeds with their lawyers and paying taxes, the two men will still have a significant amount of money left over. There are still as many of a half dozen banks involved in the litigation, representing millions more in potential settlements, as well.

The two men say they will “exit this business” now that they’ve come into serious money, but neither man seemed to know what they will do next. “I really haven’t given it any thought, to be honest with you,” said Bibby. So how did two mortgage brokers from Alpharetta, Ga., land such a life-changing windfall? The two men sued a half dozen or more banks for fraud, alleging that the banks defrauded military veterans in U.S. Department of Veterans Affairs home loans by hiding unallowable fees in mortgage documents.

Under the whistleblower law, known as the False Claims Act, people who bring significant new information about fraud to the government’s attention can keep up to 30 percent of any final payment that results from their tips. Read full article from CNBC



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