by Ben Vernia | February 10th, 2012
On February 10 – one day after announcing a mammoth $25 billion settlement of home mortgage foreclosure fraud allegations – the Department of Justice announced a much smaller, $3.9 million settlement of mortgage fraud allegations, relating to mortgages for nursing homes:
Capmark Finance LLC in Horsham, Pa., has agreed to pay the United States $3.9 million, to settle a False Claims Act lawsuit, the Justice Department announced today. The lawsuit, filed in the Central District of California, alleges that Capmark made false statements in connection with two nursing home mortgage loans insured by the U.S. Department of Housing and Urban Development (HUD). Shortly after the United States filed its complaint in 2009, Capmark filed for bankruptcy protection.
The United States alleges that Capmark misrepresented material facts critical to the borrowers’ creditworthiness in the two loan applications and that Capmark’s false statements induced HUD to insure the loans, both of which defaulted, causing a loss to the government. The two nursing homes were Canoga Care Center in Canoga Park, Calif., and Hudson Valley Care Center in Ghent, N.Y.
