Talks have ended between three former Washington Mutual executives and the federal government over possible settlement of a lawsuit alleging that their “gross mismanagement” led to the giant thrift’s demise.
The Federal Deposit Insurance Corp. in March sued former WaMu CEO Kerry Killinger; former WaMu Chief Operating Officer Stephen Rotella; and David Schneider, former head of WaMu’s home-loans division.
A motion to dismiss the suit is pending.
The agency accused them of recklessly pushing WaMu into making billions in high-risk home loans, despite knowing the nation was in an unprecedented housing bubble.
WaMu collapsed in September 2008, largely because of losses in the mortgage business.