Wells Fargo's "Seventeen Worthless Mortgages"


On March 1, 2011, the US Court of Appeals (Fourth Circuit) filed a Per Curiam opinion. In Wells Fargo Bank, N.A. v Old Republic Title Insurance Company, Wells Fargo sought to recover the value of "seventeen worthless mortgages" - the Court's own words! - it purchased from Financial Mortgage, Inc. (FMI), a mortgage banker, in the secondary mortgage market. The scheme involved Title Pro, an agent of Old Republic, colluding with FMI to fraudulently close the real estate transactions underlying Wells Fargo's mortgages. Wells Fargo claimed that Old Republic was contractually bound to indemnify Wells Fargo for its losses.

The Court ruled in favor of Old Republic! Let's learn why.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Jonathan Foxx, Lenders Compliance Group | Attorney Advertising

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