US sues Deutsche Bank for mortgage fraud

3rd May 2011, Comments 0 comments

The US Justice Department sued German giant Deutsche Bank Tuesday for mortgage fraud, saying the bank obtained government insurance for substandard mortgages during the US housing boom.

Deutsche Banke and subsidiary MortgageIT "repeatedly lied to be included in a government program to select mortgages for insurance by the government," said the Justice Department complaint, filed Tuesday in New York federal district court.

"While Deutsche Bank and MortgageIT profited from the resale of these government-insured mortgages, thousands of American homeowners have faced default and eviction, and the government has paid hundreds of millions of dollars in insurance claims, with hundreds of millions of dollars more expected in the future," it said.

© 2011 AFP

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