Four former employees of a Colorado mortgage originator claim in a lawsuit that their former employer fired them for trying to blow the whistle on widespread mortgage fraud taking place at the company.

The Denver Post has the details on American Financing Corp., an originator based in Aurora.

Here’s the skinny from the Denver Post:

The mortgage originator allegedly misled at least a half-dozen banks and finance companies with faked documents and consumer loan applications, according to the whistle-blower lawsuit.

The action in Arapahoe County district court claims managers at the company knew of the alleged mortgage fraud the employees discovered and, in some cases, worked hard to try to cover it up.

The four employees claim that they were concerned by the company’s alleged actions and brought those concerns to their superiors, only to be suspended and ultimately fired.

Again from the Denver Post:

Some of the alleged fraud was brazen, including assertions that potential borrowers’ income tax returns were intentionally withheld to hide potentially adverse information, relying instead on their W-2 forms.

The banks allegedly defrauded include JP Morgan Chase, Wells Fargo, US Bank, Flagstar Bank and PennyMac, according to the lawsuit, and other institutions include the Colorado Housing and Finance Authority.

According to the report, the company claims that the allegations are false and plans to “vigorously” defend itself.

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