Michael Strauss, the founder and chief executive of American Home Mortgage Investment (AHMIQ), has faced a swarm of problems in recent months. One of the biggest, fastest-growing mortgage lenders in the country, its shares had slipped from a high of $36.40 last December to $10.47 by late July as the housing crisis deepened.
On July 31, things got decidedly worse. After the Melville (N.Y.) company announced that it would delay its dividend amid growing cash woes, panicked investors fled, sending the shares tumbling $1.04 by the end of the day. Six days later, American Home Mortgage filed for bankruptcy in Delaware (see BusinessWeek.com, 7/30/07, "American Home’s Credit Crisis").
Now, could Strauss potentially face civil insider trading charges as well?
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Filed under Scams, Mortgage News, Credit, Wholesale Lenders, Litigation, Mortgage Blog, Housing Crash, subprime meltdown, credit crunch, Alt-A Mortgage, Liquidity Crisis by Godfather
The U.S. Supreme Court upheld the opinion of Watters v. Wachovia, allowing Michigan mortgage companies operating as subsidiaries of national banks to be exempt from registering with the state financial services regulator or complying with state mortgage lending laws. While the Mortgage Bankers Association is applauding, NAMB is criticizing the decision.
NEW YORK (Reuters) - A Credit Suisse Group (CSGN.VX: Quote, Profile, Research) unit is charging three subprime mortgage lenders with violating loan obligations and has filed lawsuits totaling over $30 million.
DLJ Mortgage Capital Inc., a Credit Suisse unit that purchases mortgage loans from lenders, alleges in separate suits that Sunset Direct Lending LLC and Infinity Home Mortgage Co. Inc. breached agreements to repurchase loans they originated.
DLJ is seeking nearly $24 million in buybacks from Sunset and $3 million from Infinity.
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Mitch Heffernan is involved in starting a new mortgage business, but his old company - the now-defunct Mortgage Lenders Network - could land him in plenty of trouble with the state for not paying wages earned by his former employees.
The state Department of Labor confirmed Monday that it has applied for an arrest warrant in Superior Court in Middletown that would charge Heffernan - the former president of Middletown-based Mortgage Lenders - with 61 counts of failing to pay wages.
The wages that the department alleges were unpaid total $3 million, mostly in sales commissions. The commissions range from $5,000 to $300,000.
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