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Politico: Trump names Quicken executive to HUD landing team amid lawsuit

November 30, 2016

Politico: Trump names Quicken executive to HUD landing team amid lawsuit

 

By Lorraine Woellert

11/29/2016 03:21 PM EDT

President-elect Donald Trump has named Shawn Krause, the head of Quicken Loans' government relations operation, to the transition's landing team for the Department of Housing and Urban Development, which is involved in a highly charged federal lawsuit against the company.

The Justice Department sued Quicken last year after the company refused to settle claims that it knowingly issued defective mortgages insured by HUD's Federal Housing Administration. Quicken has vowed to fight, saying that of nearly half a million loans, only a handful failed to meet technical muster under FHA rules.

Earlier this month, a federal judge agreed to a Quicken request to transfer the case for trial from Washington, D.C., to Detroit, where the company is based.

Mortgage lenders big and small have settled with Justice in similar cases, in part to avoid potential liability under the False Claims Act, a Civil War-era law that sets civil penalties at triple the amount of actual damages. In April, Wells Fargo agreed to pay $1.2 billion to settle a similar DOJ claim, a record for an FHA violation.

Krause leads Quicken's government advocacy and was listed in Senate records as a registered lobbyist as of Nov. 18. She recently deregistered, Quicken Chief Executive Officer Bill Emerson told POLITICO.

"Shawn has nothing to do with the DOJ," Emerson said. "I don't think it's a conflict of interest."

Her industry experience, including in technology and capital markets, will provide the transition with insight into the agency, he said.

"Other than writing loans, Shawn's done everything there is to do in the mortgage industry," Emerson said. "Having her on a landing team inside HUD, with her skill, her knowledge, it's one of the best things that could have happened to HUD."