As previously disclosed, the Audit Committee of the Company's Board of Directors has been conducting an independent internal investigation of the Company's mortgage origination business since April 2007. The Audit Committee retained Alston & Bird LLP as its independent legal counsel which, in turn, retained Navigant Consulting, Inc. as independent forensic accountants, to assist with the investigation. The internal investigation was conducted across the Company's operations and the findings are summarized as follows:
Mortgage Origination
The internal investigation found evidence that employees of the Company's Beazer Mortgage Corporation subsidiary violated certain U.S. Department of Housing and Urban Development (''HUD'') regulations, particularly in relation to Down Payment Assistance programs, in certain Federal Housing Administration (''FHA'') insured loans originated by Beazer Mortgage Corporation dating back to at least 2000. As discussed below, due to several uncertainties regarding the Company's ultimate liability from these matters, at this time it is not possible for the Company to determine the total financial statement impact related to the mortgage issues identified in the internal investigation.
