The Federal Reserve Bank of New York is investigating whether Goldman Sachs' (GS.N) mortgage servicing arm did not conduct proper reviews before denying borrowers the option to lower their payments under a government loan modification programme, the Financial Times reported.
Goldman unit, Litton Loan Servicing, denied loans without appropriate review under a "denial sweep" strategy in order to clear a backlog of applications, the newspaper said citing a source familiar with the unit.
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