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The U.S. Department of Justice (DOJ) announced that Indian Land, South Carolina-based Movement Mortgage LLC will pay $23.75 million to resolve allegations that it violated the False Claims Act when it failed to comply with material program requirements during its origination and underwriting of mortgages insured by the Federal Housing Administration (FHA) or guaranteed by the Department of Veterans Affairs (VA).

As part of the settlement, Movement Mortgage admitted that it certified a “material percentage” of FHA mortgage insurance and VA home loan guarantees that fell short of applicable requirements, thus making them ineligible under those programs. As a result, the company inaccurately claimed the loans complied with applicable FHA and VA program requirements.

Movement Mortgage also acknowledged that the FHA and the VA would not have insured or guaranteed the loans if they were aware of their shortcomings, and it also acknowledged the failure to adhere to the agencies’ respective self-reporting requirements. The covered conduct stretched back as far as July 2008, and the DOJ noted the company took “significant measures to stop the practices, both before and after being notified of the United States’ investigation.”

“Lenders participating in mortgage programs backed by taxpayers must follow rules designed to protect both program integrity and homeowners,” said U.S. Attorney Carla B. Freedman.  “Today’s settlement holds Movement Mortgage accountable for its past violations, while acknowledging that it has taken steps to strengthen its internal controls to ensure future compliance with FHA and VA requirements.”

This investigation into Movement Mortgage was triggered by a whistleblower lawsuit filed by two former employees, who will receive $4 million of the settlement proceeds.

Movement Mortgage, which was founded in 2008 by former NFL tight end Casey Crawford, did not issue a public comment on the settlement.

Photo of Casey Crawford courtesy Movement Mortgage

 

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