Whistleblower News From The Inside — May 16, 2016
By the C|C Whistleblower Lawyer Team
M&T Bank Agrees to Pay $64 Million to Resolve Alleged False Claims Act Liability Arising from FHA-Insured Mortgage Lending – DOJ had alleged that M&T Bank, a “direct endorsement lender” with the authority to originate, underwrite and endorse mortgages for FHA insurance, failed to adhere to the standards required by the FHA. The case begain as a whistleblower lawsuit filed under the False Claims Act by a former employee of M&T Bank, Keisha Kelschenbach. DOJ
Virginia hedge fund director, on trial and later convicted of securities fraud with respect to one fund, pleads guilty to using assets of second hedge fund to pay for his criminal defense – Jeffrey Martinovich, sentenced to 140 months on the first charge, now faces a maximum penalty of 20 years for his plea to money laundering. DOJ (ED VA)
SEC awards whistleblower $3.5 million – Although confidential, the SEC stated that the award was to a company employee whose tip bolstered an ongoing investigation with additional evidence of wrongdoing that strengthened the SEC’s case. SEC
SEC charges two attorneys with fraud – The SEC alleges that Jay Mac Rust and Christopher K. Brenner collected $13.8 million from small businesses seeking commercial loans, purporting to act as escrow agents for a loan company called Atlantic Rim Funding. In fact, according to the complaint, Atlantic had no ability or intention to obtain loans for the clients, and the individual attorney instead used the funds to make undisclosed risky investments, including in accounts in their own names. SEC
Guilty plea and $66.5 million fine in price fixing case against automotive parts manufacturer Corning International Kabushiki Kaisha – The company agreed to pay the fine to settle allegations that it conspired to fix prices, rig bids, and allocate the market for ceramic substates used in catalytic converters. DOJ
Whistleblower says Wells Fargo terminated him after he complained about bank’s practice of threatening foreclosure despite lacking required documentation – Duke Tran claims Wells Fargo defrauded the U.S. government by collecting federal foreclosure-prevention funding for loans the bank knew lacked proper documentation. Oregonian