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 Office for the Northern District of New York in a civil investigation of Gateway Funding Diversified Mortgage Services, LP, now known as Finance of America Mortgage, LLC (FAM). Gateway was a Federal Housing Administration (FHA)-approved mortgage lender. On May 31, 2015, FAM’s parent company acquired Gateway. FAM has its principal place of business in Horsham, PA.On December 7, 2018, FAM entered into a settlement agreement with the Federal Government to pay $14.5 million to avoid the delay, uncertainty, inconvenience, and expense of lengthy litigation. As part of the settlement, FAM agreed that Gateway engaged in certain conduct and omissions related to FHA-insured mortgages in connection with its origination and underwriting of single-family residential mortgage loans insured by FHA. The settlement agreement was neither an admission of liability by FAM nor a concession by the United States that its claims were not well founded.As a result of Gateway’s conduct and omissions, HUD insured loans approved by Gateway 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 $14.5 million settlement, HUD FHA received $7.23 million, and the remaining $7.27 million was paid to other Federal entities and the relator.
New York, NY
United States
