The Justice Department announced that Deloitte would pay a $149.5 million fine to put “potential False Claims Act liability” to bed for its role as the auditor of Taylor, Bean & Whitaker Mortgage Corp., the failed mortgage originator.
Justice alleged that “Deloitte’s audits knowingly deviated from applicable auditing standards and therefore failed to detect TBW’s fraudulent conduct and materially false and misleading financial statements.” It was this failure that allowed TBW “to continue originating FHA-insured mortgage loans” until the company’s bankruptcy in 2009.
Deloitte settled with TBW’s bankruptcy trustee in 2013 for an undisclosed amount.
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