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Nonprofit Group Comes Under Fire for Housing-Loan Program

April 19, 2010, 11:00 am

The Rainy Day Foundation, a nonprofit organization in Washington, set up to help needy homeowners avoid foreclosure, is now under federal investigation. The government says the charity helped lenders make high-risk loans that leave the government responsible if the loans go bad, The Washington Post reports.

Federal officials say they are concerned the foundation could be hampering federal efforts to protect consumers from mortgage lenders that make too many risky loans.

Rainy Day’s chief executive office, Rick Del Sontro, said in an interview with The Post that his organization provides a valuable service to borrowers and lenders, but he would not comment on the Justice Department’s allegations.

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