Investigation on Countrywide Financial Corp
2008-03-10 14:48:16 (GMT) (Caymanmama.com - Real Estate News Top Stories News)New York: According to CNN, the Wall Street Journal reported on Saturday that the FBI is going to investigate into loan policies of Countrywide Financial Corporation, a weather-beaten home lending company. An official of the US government has said that fraud is suspected on the part of the company, which may be contributing to the sub-prime mortgage crisis rocking the economy of the United States.
The journal mentions that the probe is going to examine the mortgage origination and under-writing practices of the company, and whether the losses that it has represented in relation to the sub-prime loans are tainted. Although the FBI has admitted that they are investigating on the issues related to the shambles of sub-prime loans, neither the Justice Department nor the FBI are ready to comment on their definite objects. “The FBI has been investigating potential fraud in the mortgage/sub-prime lending industry, however, we can not confirm or deny which companies are under investigation,” said Rich Kolko, an FBI spokesman.
At the initial stage of housing crash, Countrywide witnessed a large number of customers who were found offending with the payments of their mortgages. Consequently, last year, the company had to shut down the sub-prime lending operations, so that they can focus on the originating loans conforming to the guidelines of Fannie Mae and Freddie Mac, considering them to be secured investment options.
CNN reported that both Bank of America and Countrywide had agreed to acquire the Countrywide in stock for $4 billion in January, but now, they are not returning its calls.
CaymanMama.com - Press Release Distribution Service
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