Warren asks DOJ to explain 'timid' FHA settlement
Warren asks DOJ to explain 'timid' FHA settlement
Sen. Elizabeth Warren (D-Mass.) is pressing the Justice Department to explain what she sees as an insufficient deal to settle housing problems caused by some of the nation's largest banks.
In a letter sent to Attorney General Eric Holder Wednesday, Warren wondered if a portion of a broad government settlement with mortgage servicers amounted to a drop in the bucket, and a sign of the government's "timid enforcement strategy" when it comes to chasing bad actors in the financial sector.
In particular, Warren is questioning a $225 million penalty paid by the servicers to settle potentially false claims filed with the Federal Housing Administration, which is currently facing its own financial difficulties. She argued that amount was a fraction of what should have been pursued, adding that the FHA's fiscal woes could have been aided by a more aggressive approach.
"There are a number of contributing factors to FHA's current financial difficulties, but the potential failure of DOJ to get adequate compensation for fraud committed against FHA is a serious issue," she wrote.
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