Deutsche Bank, MortgageIT Suit Should Go Forward, U.S. Says
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Deutsche Bank AG, Germany’s biggest bank, and its MortgageIT unit should be required to defend the $1 billion suit by the government claiming they lied as part of a “massive fraud” to qualify thousands of risky mortgages for a federal insurance program, the U.S. said.
The U.S. claims Frankfurt-based Deutsche Bank and MortgageIT falsely certified that they properly assessed the default risk of borrowers, qualifying loans for insurance by the Housing and Urban Development Department’s Federal Housing Administration, according to a complaint filed May 3 in Manhattan federal court.