Can a lawsuit be filled against a financial company whose employee committed fraud?
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Can a lawsuit be filled against a financial company whose employee committed fraud?
The company that financed my home employee was found guilty of mortgage
fraud against me and others.
Asked on March 31, 2016 under Real Estate Law, North Carolina
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 8 years ago | Contributor
If fraud was committed against you that hurt *you* in some way (e.g. stole or took money from you, or increased your costs), then as a general matter, you can sue the person who committed fraud (i.e. any employee) and *possibly* the employer (the mortgage company). The issue is, was the fraud sufficiently part of the employee's employment--that is, was it something he/she was expected to do by his employer, or which benefited the employer and was done in the course of the employment--as to make the employer liable. As a rule of thumb, if the employer directly benefit from the fraud and the fraud was done while the employee was doing the core functions of his/her job, then the employer may be liable, too. But if the fraud only benefited the employee, not the employer, then most often the employer (in this case, the mortgage company) is not responsible for an illegal act outside its control which it did not encourage or benefit from.
And again: there must be some provable financial, etc. injury to you: the law only provides compensation for actual losses or costs, if you were not hurt by this, there is no lawsuit.
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