The Justice Department slapped a fine of $4.3 million and $5million on Security NationalFinancial Corp.'s SecurityNational Mortgage Co. and Primary Residential Mortgage Inc., respectively, forviolating the False Claims Act.
The department charged the companies with knowinglyoriginating and underwriting mortgage loans insured by the Federal HousingAdministration even if they did not meet certain requirements.
The companies admitted that they certified loans for FHAmortgage insurance that did not meet the Department of Housing and UrbanDevelopment's underwriting requirements regarding borrower creditworthiness andeligibility
SecurityNational "made no admission of liability orfault, but chose to resolve the matter through a settlement agreement ratherthan engage in protracted and costly litigation," it said in a regulatoryfiling. The settlement, entered into with the Justice Department and the U.S.Attorney's Office, does not affect the company's status with HUD.