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Executives with criminal records slip through FHA crackdown, documents show

Executives with criminal records slip through FHA crackdown, documents show By Brian Grow Center for Public Integrity Sunday, September 12, 2010

A crackdown on reckless mortgage lenders by the Federal Housing Administration has failed to root out several executives with criminal records whose firms continue to do business with the agency in violation of federal law, according to government documents, court records and interviews.

The get-tough campaign has also been hamstrung because, even when the FHA can ban mortgage companies for wrongdoing or an excessive default rate, the agency does not have the legal power to stop their executives from landing jobs at other lenders, or open new firms.

After the collapse of the home loan market, the FHA launched an effort aimed at reducing losses on mortgages it insures by weeding reckless lenders out of the program.

But documents and interviews reveal that more than 34,000 home loans have been issued over the past two years by a dozen FHA-approved lenders that have employed people who were convicted of ……………

http://www.washingtonpost.com/wp-dyn/content/article/2010/09/10/AR2010091003234.html?hpid=topnews

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