BUSINESS
09/10/2010 10:03 pm ET | Updated May 25, 2011

Reckless Mortgage Lenders With Criminal Records Slip Through Federal Crackdown

A crackdown on reckless mortgage lenders by the Federal Housing Administration has failed to root out several executives with criminal records whose firms continue to do business with the agency in violation of federal law, according to government documents, court records and interviews.

The get-tough campaign has also been hamstrung because, even when the FHA can ban mortgage companies for wrongdoing or an excessive default rate, the agency does not have the legal power to stop their executives from landing jobs at other lenders, or open new firms.

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