(Reuters) - A Deutsche Bank AG (DBKGn.DE) mortgage unit has agreed to pay $202.3 million to settle one of the biggest U.S. government civil fraud lawsuits over reckless mortgage lending practices.
The bank's MortgageIT unit admitted it had lied to the U.S. Department of Housing and Urban Development (HUD) that loans it issued were eligible for federal mortgage insurance when they were not, the U.S. attorney's office in Manhattan said on Thursday. It said MortgageIT "repeatedly submitted certifications that were knowingly or recklessly false."
Deutsche Bank and MortgageIT did not conform to federal regulations and as a consequence, HUD incurred losses when about a third of the loans defaulted, Manhattan U.S. Attorney Preet Bharara said. He said the damages to be paid by the bank would help compensate HUD.
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