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Document

The U.S. Department of Housing and Urban Development (HUD), Office of Inspector General (OIG), assisted the U.S. Department of Justice (DOJ) and the U.S. Attorney’s Offices, District of New Jersey, District of Minnesota, and Southern District of Florida, in the civil investigation of PHH Corporation, PHH Mortgage Corporation (PHHMC), and PHH Home Loans, LLC (PHHHL), collectively referred to as PHH.  PHH was a direct endorsement lender having its principal place of business in Mount Laurel, NJ.

On August 3, 2017, PHH entered into a settlement agreement with the Federal Government to pay $65 million in a combined settlement amount.  The United States attributes $45.5 million to PHHMC and $19.5 million to PHHHL.  PHH agrees that it engaged in certain conduct related to FHA-insured mortgages in connection with PHHMC’s and PHHHL’s origination, underwriting, endorsement, and quality control of single-family residential mortgage loans insured by FHA between January 1, 2006, and December 31, 2011, that resulted in claims for payment submitted to FHA on or before June 30, 2013.  The settlement agreement is neither an admission of liability by PHH nor a concession by the United States that its claims were not well founded.

As a result of PHH’s conduct and omissions, HUD insured loans approved by PHH that were not eligible for FHA mortgage insurance under the direct endorsement program and that HUD would not otherwise have insured.  HUD incurred substantial losses when it paid insurance claims on these loans.  Of the total $65 million settlement, HUD FHA will receive $42.6 million.

Recommendations

General Counsel

  •  
    Status
      Open
      Closed
    2017-CF-1806-001-A
    $42,600,000.00
    Questioned Costs

    Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.

    Closed on October 01, 2018

    Acknowledge that $42,600,000 of the $65,000,000 in the attached settlement agreement represents an amount due HUD, less DOJ’s civil debt collection fees.