No government help this time for 'robo-signing' whistleblower

by Ryan Smith28 Apr 2014
A whistleblower who helped the federal government recover $95 million from Bank of America and other lenders is on her own in a new lawsuit against 22 financial institutions.

Lynn Szymoniak threw a spotlight on the “robo-signing” scandal, in which banks foreclosing on mortgages were allegedly routinely backdating foreclosure documents, forging signatures and falsely stating dates of transfer, among other things. The Department of Justice intervened in that lawsuit, recovering $95 million from the banks. Szymoniak herself got $18 million under a law that allows whistleblowers to sue for fraud on behalf of the federal government.

She’s now suing 22 other banks, including Deutsche Bank and HSBC, alleging they’re engaged in the same behavior. However, the government hasn’t joined her lawsuit yet, according to a Bloomberg report. U.S. Dstrict Court Judge Joseph Anderson is considering a motion by the banks to throw the suit out.

“This is a case the government should take a stand on,” Symoniak’s attorney, Reuben Guttman, told Bloomberg. “It is curious as to why the government is not vigorously pursuing this along with us. They are leaving money on the table.”

The government can decide to intervene in the lawsuit at any time, provided the court grants permission.


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