A former Bank of America executive featured in iWatch News’ investigation of fraud and cover-ups in the mortgage industry has been honored with a national award for truth-telling.
Eileen Foster, the former top mortgage fraud investigator at Countrywide Financial Corp. and Bank of America, was one of the five people honored with Ridenhour Prizes this week. The awards are named in recognition of Ron Ridenhour, a U.S. Army veteran who exposed the 1968 My Lai massacre in Vietnam.
Foster took the opportunity during the awards ceremony at the National Press Club in Washington to call for criminal prosecutions of high-level executives who oversaw the fraud and predatory lending that helped spawn the nation’s foreclosure disaster.
“Here we are, several years after the onset of the financial crisis, caused in large part by reckless lending and risk-taking in major financial institutions and still not one executive has been charged or imprisoned,” Foster said.
If federal prosecutors can’t nail down cases for the original frauds in the banking industry, she said, they should prosecute the cover ups that helped hide these crimes — drawing on the "overwhelming evidence of perjury, witness tampering and obstruction of justice” that can be found in court cases and government documents.
The U.S. Department of Labor ruled last year that Bank of America had improperly fired Foster for leading internal investigations that “revealed widespread and pervasive wire, mail and bank fraud” at Countrywide. It ordered the bank to reinstate her and pay her some $930,000.
Foster, who worked first at Countrywide and then at Bank of America after it acquired Countrywide in 2008, claimed that Countrywide executives covered up fraud and worked to silence whistleblowers who tried to report forged documents, faked data and other illegal activity inside what was once the nation’s largest mortgage lender.
Bank of America is appealing the Labor Department’s decision. The bank claims its decision to fire Foster was “solely based on issues with the employee’s management style and in no way related to the employee’s complaints and the allegations made in the complaint.” It said never retaliates against workers who raise questions about fraud or other problems.