The mortgage consultant tried to expose fraudulent practices in the company
A former mortgage company employee has been awarded $37,000 by a jury in a wrongful termination lawsuit related to her reports of mortgage loan application fraud to company management, according to a report by The Denver Post.
Mortgage consultant Sandra Reynolds had claimed that Aurora, Colo.-based American Financing wrongfully fired her for blowing the whistle on fraud practices in the company. The jury in Arapahoe County District Court decided in Reynolds’ favor. In Colorado, whistleblowers are protected from retaliation.
Three of Reynolds’ co-workers also filed wrongful termination lawsuits. However, the jury ruled against them.
The four plaintiffs alleged that the company suspended and later fired them after they tried to expose fraudulent tactics in March 2017. Company employees allegedly used false documents and consumer loan applications to mislead at least a half-dozen banks and finance companies.
The suit also claimed that company managers knew of the alleged mortgage fraud the plaintiffs discovered. In some cases, managers worked hard to try to cover it up.
American Financing has not been charged or penalized in connection with any of the allegations, according to the report.
“American Financing Corp. is pleased to have reached this stage in the case. We defended our actions successfully with respect to three of four plaintiffs. The jury disagreed with our personnel decision as to the fourth plaintiff. We respect the jury’s decision but do not agree that any of our human resources decisions were incorrect. As the case is still pending, further comment would be inappropriate,” an American Financing representative said in a statement.
