Landmark False Claims Act Lawsuit, expert calls it Domestic Financial Terrorism; Press conference by Social Phenomenon Thinktank at 10:00 a.m. on Wednesday, December 4 at The Avanzado Law Firm
PASADENA, Calif., Nov. 26, 2019 (GLOBE NEWSWIRE) -- The Avanzado Law Firm estimates that the federal False Claims Act Lawsuit could result in more than $316 million in civil penalties due from Cherry Creek Mortgage to the United States government to redress the greed shown by a Colorado mortgage lender that flaunted protections enacted to protect borrowers, American taxpayers, and the loan mortgage industry, says Mel Avanzado, a litigator who has taken up the cause.
Whistleblower Tom Jarboe and his attorney Avanzado have filed a federal False Claims Act lawsuit against Denver-based mortgage lender, Cherry Creek Mortgage Company, in a case entitled United States of America ex rel. Thomas R. Jarboe v. Cherry Creek Mortgage Co. seeking an estimated $316 million in fines. The case was filed in April 2018, and actual damages are yet to be calculated as other victims fall prey to Cherry Creek’s scheme. National Security and Economic Development Advisor advising both local and foreign governments, Saman Seneviratne provides expert opinions that such egregious actions that ignore regulations designed to prevent another financial crisis in the home mortgage industry are tantamount to domestic financial terrorism that may lead to the next financial collapse and thereby weakening American Global Leadership.
Cherry Creek Mortgage isn’t new to lawsuits for violating federal laws. In 2017, Cherry Creek was sued for multiple discrimination claims by an employee Judith Dominguez, in federal District Court in California, case number 2:17-cv-06085 which resulted in the Chairman of the company resigning and company being forced to change their policies towards the employees, according to HKM Employment Attorneys, who handled that lawsuit.
In court documents in his False Claims Act lawsuit Jarboe highlighted Cherry Creek’s history of breaking federal laws, intimidation, retaliation and even bullying federal agencies to get their way. Cherry Creek last week served subpoenas on HUD to in an attempt to intimidate the agency into excusing Cherry Creek’s conduct, added Avanzado. Jarboe said that, “Cherry Creek believes that it is so powerful, politically and economically, that they can violate federal regulations with impunity.”
Avanzado and documents filed in the lawsuit indicate that Cherry Creek has repeatedly violated the FHA and HUD regulations enacted to protect the consumer from fraud. Avanzado added that these regulations were enacted after the 2008 market collapse to ensure that lenders would not take excessive risks or incentivize fraud as part of their business. Cherry Creek’s position in the lawsuit appears to be that, since they have been operating as they have and though it may be in violation of these regulations for years, those regulations should be changed to allow them to continue their current business practices.
In his lawsuit, Jarboe and his lawyers contend that abolishing these consumer protections would incentivize Cherry Creek and its employees to make riskier underwriting decisions, falsify documents and circumvent HUD/FHA strict reporting and approval process. The lawsuit further alleges and Avanzado said that Jarboe is one of many Cherry Creek employees that have suffered from Cherry Creek’s business practice that requires its employees to pay for Cherry Creek’s branch overhead while hiding its branch managers from regulatory reviews and scrutiny, preventing HUD/FHA from monitoring and enforcing the regulations.
Avanzado said the evidence will show that Cherry Creek’s predatory practices have bankrupt its branch managers, stolen their life savings and even caused stress induced heart attacks. Avanzado added that in Cherry Creek’s attempts to get around allegations in Jarboe’s lawsuit, Cherry Creek has employed intimidation tactics, naming Housing and Urban Development Secretary Ben Carson, as well as other high ranking HUD and FHA officials as “witnesses” and subpoenaing them in an effort to discourage HUD from allowing Jarboe’s lawsuit to proceed to trial.
Cherry Creek had the case moved from California to Colorado, their home state, and has lobbied to change the consumer protection laws governing FHA lending (19-cv-01529-CMA-KLM), which Jarboe equated to opening the flood gates for non-depository (non-traditional banks) lenders to flood the mortgage market once again with riskier loans and opening branches with shakier financial health, which could cause a repeat of the 2008 mortgage market collapse. Jarboe and Avanzado together are fighting to protect the American taxpayers. “Will Secretary Carson and the Trump Administration stand firm protecting the public, or forced to fold under pressure from unscrupulous mortgage lenders like Cherry Creek and roll back consumer protection laws?” Seneviratne posed to the administration.
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