The mortgage lending operations of Washington Mutual Inc., the biggest U.S. bank ever to fail, were threaded through with fraud, Senate investigators have found.

Sen. Carl Levin, D-Mich., the chairman, said …Washington Mutual “was one of the worst,”

n some cases, sales associates in WaMu offices in California fabricated loan documents, cutting and pasting false names on borrowers’ bank statements. The company’s own probe in 2005, three years before the bank collapsed, found that two top producing offices — in Downey and Montebello, Calif. — had levels of fraud exceeding 58 percent and 83 percent of the loans.

SOURCE: nbcnews.com…