JACKSONVILLE, Fla. — A former auditor for a firm now owned by the largest CU card processor charged her former firm, Watterson Prime, deliberately verified subprime loans she had kicked back as being bad.
Noted processor Fidelity National Information Services purchased Watterson Prime in November 2006. A story on National Public Radio's May 26 Morning Edition Program included statements from former Watterson auditor Tracy Warren.
"I'd see people who were hotel workers, saying that they made, in California, $15,000 a month so they could qualify for a $500,000 home. You know, if a hotel worker can make $15,000 a month changing sheets at the Days Inn, everyone would want to do it. It just really made no sense," Warren said in the story.
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Warren said that when she would kick back a loan with for example, credit scores below 580 and where the income could not be verified, her supervisors would overrule her and reverse her disapprovals.
The story said that Fidelity National had issued a statement that the company does not have any incentive to give loans passing reviews that fail underwriting criteria and that it uses additional criteria to double check loan quality. FIS has not yet responded to a call for comment.
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