Government Touts $38.5M Recovery in Case it Argued ‘Never Should Have Proceeded This Far’

The Department of Justice this week publicized a $38.5 million False Claims Act settlement in a lawsuit that it fought to have dismissed, against the wishes of the whistleblower who alleged her former employer was improperly underwriting mortgages insured by the Federal Housing Administration.

The government, after declining to intervene, argued it didn’t have the resources to proceed with Gwen Thrower’s suit against Academy Mortgage Corporation. U.S. District Judge Edward M. Chen was not impressed with the argument, becoming the first judge in U.S. history to deny such a dismissal motion from the government and taking the government to task in a six-page ruling for presenting no evidence to support its claims.