Regions Bank settles False Claims Act allegations.

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Birmingham, Alabama-based Regions Bank announced it had resolved allegations that it violated the False Claims Act (FCA) with regard to Federal Housing Administration (FHA) loans and agreed to pay $52.4 million to the federal government, according to the Department of Justice (DOJ).

A Sept. 13 DOJ press release stated, "As a result of Regions' conduct and ommissions, HUD [the Department of Housing and Urban Development] insured hundreds of loans approved by Regions that were not eligible for FHA mortgage insurance under the [Direct Endorsement Lender] program and that HUD would not otherwise have insured. HUD subsequently incurred substantial losses when it paid insurance claims on those loans."

DOJ's press release noted that, "Regions admitted that between Jan. 1, 2006, and Dec. 31,2011, it certified for FHA insurance certain mortgage loans that did not meet certain HUD underwriting requirements regarding borrower creditworthiness." DOJ also maintained that Regions "did not maintain a quality-control [QC] program that fully complied with the requirements established by HUD" for the FHA loans in question that were originated between January 2006 and December...

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