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mortgagemessiah
8003 Posts |
 Posted - 08/12/2008 : 9:23:37 PM
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State regulator quits under fire over criminals' broker licenses
By DARA KAM
Palm Beach Post Capital Bureau
Tuesday, August 12, 2008
TALLAHASSEE — Florida's top regulator of mortgage brokers said Tuesday that he will resign next month after his agency licensed thousands of brokers with criminal backgrounds, including racketeering and money laundering.
Don Saxon, chief of the Office of Financial Regulation, who has spent more than three decades as a state government worker, announced his intention to step down at Tuesday's Cabinet meeting after Chief Financial Officer Alex Sink attempted to force his resignation.
Gov. Charlie Crist seconded her motion, but before it was voted on, Saxon told the panel that he intends to resign after an audit of his agency, scheduled to be completed within 30 days.
Sink cited a series of foul-ups caused by lax oversight, including a "damning" statewide grand jury report that criticized Saxon's office for failing to halt wrongdoing in the check-cashing industry.
"The grand jury said there are billions of dollars being filtered - illegal money, dirty tainted money - that are being filtered through some of the money transaction businesses," Sink said as Saxon stood at a podium facing the panel.
The Cabinet also approved emergency rules Saxon proposed that will prohibit felons who have committed crimes directly related to mortgage brokering, such as money laundering, extortion and bribery, from ever being licensed.
Other criminals will have to wait between five and 15 years to get a broker license, depending on the crime, and anyone who has served a prison term will have to wait five years after release to receive a license.
The new rules apply only to mortgage brokers and do not prevent criminals from owning the businesses that originate the loans. That would require a law passed by the legislature, Saxon told Crist, Sink, Attorney General Bill McCollum and Agriculture and Consumer Services Commissioner Charles Bronson, who make up the Cabinet.
McCollum questioned the panel's authority over the new rules.
"I'm not sure we have the authority to do this today with regard to these. But I think we ought to pass it. I think we ought to try it. It may be legal. It may not be legal," said McCollum, the state's top lawyer.
The panel voted unanimously to approve the rules.
The actions came after an eight-month investigation by the Miami Herald uncovered $85 million in fraud involving thousands of mortgage brokers with criminal records licensed by Saxon's office. On Sunday, the Herald reported that one-third of brokers caught committing fraud were allowed to keep working in the industry.
Two weeks ago, Crist ordered an audit of the agency.
"I recognize that things could have been done better. It was always my hope that once that audit is completed, it will demonstrate that our office has not acted as recklessly, if you will, as the Miami Herald suggests," Saxon said.
The new rules will bring the state into compliance with a new federal law that will require states to conduct similar screenings and impose prohibitions against certain criminals handling home loans.
"We've had these scam artists galore in businesses just operating without any oversight or regulation hardly in the state," Sink said. "We're in a new era, and it's time for a different style of leadership in that office."
Steve Dibert
MFI-Miami, LLC
www.mfi-miami.com
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lukyk22
1700 Posts |
Posted - 08/12/2008 : 9:26:55 PM
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| i thinks its more like gagillions, not billions. |
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Mandyvilla
3453 Posts |
Posted - 08/12/2008 : 9:55:02 PM
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And they are shocked there is a problem.
I am amazed bonding is not a requirement. Most bonding companies would pick this up immediately. It's a non-negotiable, if a company hires one employee w/out bonding, their liability is huge. I can't think of one bank that will look the other way and continue w/ hiring someone convicted of a felony.
Makes you wonder how many out that are facing charges are those w/ a past. |
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mortgagemessiah
8003 Posts |
Posted - 08/13/2008 : 05:42:34 AM
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| In Florida, if you work as a Loan Officer you don't need to be licensed. I' working on one investigation right now where the LO and the broker had multiple felonies. They met while in prison. |
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CoolMtgGuy
3720 Posts |
Posted - 08/13/2008 : 06:10:32 AM
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The title "Loan Officer" has been used by so many in various contexts. What is your definition in the context of your post.
There are two mortgage broker licenses in Florida ... mortgage broker and mortgage broker business ... right? A licensed mortgage broker in Florida is either a principal mortgage broker for the MBB or a mortgage broker whose licensed is "parked" with the MBB. Would you call either of these people Loan Officers?
Is it someone who works for a bank vs someone who works for a mortgage broker or correspondent lender?
quote:
Originally posted by mortgagemessiah
In Florida, if you work as a Loan Officer you don't need to be licensed. I' working on one investigation right now where the LO and the broker had multiple felonies. They met while in prison.
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velecico
3997 Posts |
Posted - 08/13/2008 : 06:14:14 AM
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So you can be a congressman or senator and have a felony but not a loan officer , give me a break |
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darkstar
18310 Posts |
Posted - 08/13/2008 : 06:15:56 AM
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| Another too late knee jerk reaction to the problem down there, won't fix a thing but it'll make some feel better and may prevent some future issues...But I don't even think the criminals down there are applying for broker jobs anymore! LOL |
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Mandyvilla
3453 Posts |
Posted - 08/13/2008 : 07:36:35 AM
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quote:
Originally posted by velecico
So you can be a congressman or senator and have a felony but not a loan officer , give me a break
My initial reaction is did someone hit a raw nerve? Yes, a loan officer. If an employer or company cannot get you bonded, then yeah, a loan officer. Haven't we always had a higher standard than our elected officials? |
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CoolMtgGuy
3720 Posts |
Posted - 08/13/2008 : 08:01:19 AM
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The first State where I was licensed is CT ... and a mortgage broker bond is mandatory. Florida did not require one and that very much surprised me when I got my FL license. I have always felt that a bond requirement alone would have weeded out many who should not have made it into this business.
With that said, even CT does not require a bond to be an originator working under a broker's license so that disappointed me as well.
The other part is E&O insurance. Too many originators do not get it or have to get it. Even though most, if not all, lenders require it, originators working under others' licenses have been insulated from this as well.
As an FYI ... personal credit checks are required by the companies that will issue bonds and E&O coverage to mortgage industry people today.
quote:
Originally posted by Mandyvilla
And they are shocked there is a problem.
I am amazed bonding is not a requirement. Most bonding companies would pick this up immediately. It's a non-negotiable, if a company hires one employee w/out bonding, their liability is huge. I can't think of one bank that will look the other way and continue w/ hiring someone convicted of a felony.
Makes you wonder how many out that are facing charges are those w/ a past.
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ichibanbroker
705 Posts |
Posted - 08/13/2008 : 08:03:53 AM
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| What? No felons originating loans in Florida? There went half my competition! :) |
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sxassy
231 Posts |
Posted - 08/13/2008 : 08:08:09 AM
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quote:
Originally posted by velecico
So you can be a congressman or senator and have a felony but not a loan officer , give me a break
Something tells me that the VP at Argent who apparently is facing a combined 100 years in prison was NOT a convicted felon. I think everyone should have an equal shot at licensing, including felons, but their files should be audited more regularly at their cost. |
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tippr01
74 Posts |
Posted - 08/13/2008 : 08:19:06 AM
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Attached is a link to yesterday's Florida Cabinet Meeting in Tallahassee. Saxon starts at approximately 25 minutes into the broadcast.
http://www.myflorida.com/myflorida/c...udioindex.html
If the first link does not work try the following. Try the attached link, choose yesterday's date and audio.
http://www.myflorida.com/myflorida/cabinet/mart.html
During the meeting it was stated that Florida will revise the current regulations to meet the recently passed federal law regarding mortgage loan originators.
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CoolMtgGuy
3720 Posts |
Posted - 08/13/2008 : 08:26:14 AM
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While all this stuff is going on, FL has changed the mortgage broker test. A friend of mine has a school that trains people to pass the tests for mortgage broker and real estate sales licenses. We reviewed the new test this past weekend and it now includes a lot of new stuff that will require applicants to do a bit more homework before taking the test.
Yes, there are still people applying for their mortgage broker licenses in FL. My friend is hooked up with Amerisave and is always recruiting new licensees to sign up with them. I am just surprised that people still want to be new originators. |
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darkstar
18310 Posts |
Posted - 08/13/2008 : 09:20:23 AM
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>>>I am just surprised that people still want to be new originators
The grass always looks greener someplace, just imagine the mud they must be in! |
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mortgagemessiah
8003 Posts |
Posted - 08/13/2008 : 1:25:10 PM
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It's official! No more Felon Mortgage Brokers.
http://www.sun-sentinel.com/business/sfl-flzmortgages0813sbaug13,0,978737.story |
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darkstar
18310 Posts |
Posted - 08/13/2008 : 1:30:01 PM
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| So that means they have to put them in someone else's name again, they'll hate that! |
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mortgagemessiah
8003 Posts |
Posted - 08/13/2008 : 1:34:54 PM
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| LOL |
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