A real estate agent asked a Ninth Circuit panel Friday to restore his whistleblower suit accusing Wells Fargo, JPMorgan Chase and others of fraudulently obtaining federal mortgage insurance on deceptively priced home loans, saying changes easing the False Claims Act’s public disclosure bar should be retroactively applied to his claims.

The case stems from a complaint relator Brian Hastings filed under seal in April 2012, accusing the banks of False Claims Act violations for endorsing federally insured mortgages that fraudulently forced homebuyers to pay back down payment "gift fees," resulting in inflated prices. Hastings said the suit is based on evidence gathered in the course of extensive work he did in the mortgage industry over the last 20 years, particularly in connection with FHA programs.

In a seller-funded down-payment assistance program, Hastings explained in his opening brief, a purported charity provides money for a down payment. The seller, however, fully refunds the charity the amount of the gift plus a service fee for fronting the cash. The seller then recoups what it paid to the charity through an inflated home sales price to the buyer. readmore »