The FDIC has retained William D. Chapman to represent it in several lawsuits against mortgage brokers for submitting fraudulent information in various loan applications that subsequently went into default. The brokers signed agreements that they would verify the accuracy of information submitted by their clients in mortgage loan applications.

Mr. Chapman has established that material misrepresentations were made in the loan applications, resulting in defaults by the borrowers and foreclosures by the lender, Downey Savings & Loan, which has recently been taken over by the FDIC. In at least one of these cases, the broker prepared a memorandum admitting that she created a fraudulent loan application by "giving" the borrower a false occupation and inflating her income by approximately $10,000.00. Mr. Chapman has contacted borrowers' employers and confirmed that income for the borrowers was substantially inflated.