A former executive at loanDepot dropped a bombshell on the mortgage industry late Wednesday, alleging in a lawsuit that the California-based nonbank lender, in a ploy to drum up money during the refi boom and in preparation for its initial public offering, closed thousands of loans without proper documentation.

The suit, filed by Tammy Richards, former chief operations officer, accuses loanDepot’s CEO, Anthony Hsieh, of ordering the sales team to “trust [their] borrowers” and close loans, disregarding proper underwriting etiquette. 

Richards claims that this demand was announced during a production meeting in August 2020, where Hsieh allegedly screamed, details ⇒

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