"Walker & Dunlop's CEO Willy Walker said on a recent call with analysts that its investigation found that no employees were involved in any fraudulent activity. Not a single employee at Walker & Dunlop had knowledge of or participated in the borrowers' fraudulent flip transactions, said Walker. But Walker noted a banking team had not adhered to the firm's loan origination policies and procedures."
"Walker & Dunlop is one of a handful of lenders that have admitted to mortgage fraud-related problems where borrowers either flipped properties to related parties or inflated rents. The goal of these schemes was to extract larger loans. As of December 31, 2025, Walker & Dunlop said it had $115 billion of loans outstanding with the government-sponsored enterprises like Fannie and Freddie."
"The firm initially reported it had mortgage fraud problems at its third-quarter earnings. Freddie Mac asked the firm to investigate a $100 million loan portfolio. After digging through the 266 loans originated by the banking team, Walker & Dunlop discovered a [fraud in about $134 million of its Freddie Mac loans]."
Walker & Dunlop identified approximately $134 million in mortgage fraud across three separate loan portfolios related to three different borrowers. The fraud involved borrowers flipping properties to related parties to extract larger loans. CEO Willy Walker stated no employees participated in fraudulent activity, though a banking team failed to adhere to loan origination policies and procedures. The team members, including former senior managing director Jared Sobel and originator Jeremy Nussbaum, have since departed the firm. Walker & Dunlop manages $115 billion in outstanding loans with government-sponsored enterprises. The investigation began after Freddie Mac requested examination of a $100 million loan portfolio containing 266 loans.
Read at therealdeal.com
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