Deutsche Bank agreed yesterday to pay the federal government more than $200 million to settle accusations that it knowingly misled the Department of Housing and Urban Development about the quality of mortgages that later defaulted, the New York Times reported today. The defaults ultimately cost taxpayers about $368 million. The settlement resolves a lawsuit filed against Deutsche in May 2011 by the U.S. attorney Preet Bharara along with HUD and the Department of Justice. The home loans were issued by MortgageIT, a mortgage provider that Deutsche Bank bought in 2007. Under the terms of the settlement, Deutsche Bank admitted it should have known that MortgageIT's practices did not conform to HUD rules after it made the acquisition.
