Posted in Firm News on August 9, 2017
Butler Wooten & Peak LLP has settled a whistleblower case brought under the federal False Claims Act against Wells Fargo for $108 million. The case involved Wells Fargo charging veterans unallowable fees on a classification of VA mortgage loans called “IRRRL” loans. The VA guarantees a substantial portion of these loans, thereby reducing the bank’s risk. On behalf of our clients, we sought repayment of the guarantees that Wells Fargo collected on loans that went into default and foreclosure. Wells Fargo should never have received those payments from the Government if it would have truthfully informed the VA that it had charged veterans unallowable fees and falsely certified compliance with VA regulations. The overwhelming majority of this settlement will be returned to the Government, which reduces the burden on taxpayers. It is our hope that the VA will use this money wisely to help our nation’s veterans. This is the largest result from the 11 year-old lawsuit. The five banks that previously agreed to settle are Countrywide Home Loans, Inc. ($45 million), PNC Bank ($38 million), First Tennessee Bank ($16 million), SunTrust Mortgage ($10.2 million), CitiMortgage ($7.5 million), and JP Morgan Chase ($45 million). Jim Butler, Brandon Peak, Rob Snyder, Ramsey Prather, Joseph Colwell, Beth Glen, Zana Mixson, and Beth Telgenhoff of Butler Wooten & Peak LLP worked on the case with Marlan Wilbanks of Wilbanks & Gouinlock.