FHA Enforcement: What Decreased Reliance on the False Claims Act Means for FHA Lenders and Servicers

5 minute read | August.16.2019

Top officials at the U.S. Department of Housing and Urban Development are looking to chart a new course to win back banks that have fled the Federal Housing Administration lending program following a series of multimilliondollar False Claims Act settlements.

In the past, HUD has partnered with the U.S. Department of Justice to pursue settlements under the False Claims Act that left lenders and servicers facing treble damages plus penalties for what the government said were false certifications made in connection with deficient FHA loans. While current HUD leadership has said the government is looking to move away from the act, the steps it has outlined — including FHA’s proposals to revise its loan-and lender-level certifications — may not translate into decreased HUD enforcement risk for FHA lenders and servicers.

Originally published in HousingWire; reprinted with permission.