Issuer of Ginnie Mae RMBS Settles with SEC

first_imgSubscribe California-based First Mortgage Corporation, a lender that issued Ginnie Mae residential mortgage-backed securities (RMBS) backed by loans it originated, has agreed to pay $12.7 million to settle fraud charges brought on by the Securities and Exchange Commission (SEC).The SEC announced that the company and six senior executives will pay to settle charges that they “orchestrated a scheme to defraud investors” in the sale of residential mortgage-backed securities guaranteed by Ginnie Mae.From March 2011 to March 2015, First Mortgage and the six senior executives pulled current, performing loans out of Ginnie Mae RMBS by falsely claiming they were delinquent in order to sell them at a profit into newly-issued RMBS, the SEC alleges. In addition, First Mortgage caused its Ginnie Mae RMBS prospectuses to be “false and misleading” by improperly and deceptively using a Ginnie Mae rule that gave issuers the option to repurchase loans that were delinquent by three or more months, the SEC said.The executives charged with fraud in the SEC’s complaint agreed to the following settlements:Chairman and CEO Clement Ziroli Sr. agreed to a $100,000 penalty.Company President Clement Ziroli Jr. agreed to pay 411,421.98 plus $27,203.92 in interest and a $200,000 penalty.CFO Pac W. Dong agreed to pay a $100,000 penalty.SVP Ronald T. Vargas, who headed FMC’s capital markets department, agreed to pay a $60,000 penalty.SVP Scott Lehrer agreed to pay a $50,000 penalty.Managing Director of the servicing department Edward Joseph Sanders agreed to pay disgorgement of $51,576.51 plus $6,811.19 in interest.  Sanders cooperated in the SEC’s investigation. Governmental Measures Target Expanded Access to Affordable Housing 2 days ago About Author: Xhevrije West Demand Propels Home Prices Upward 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago Data Provider Black Knight to Acquire Top of Mind 2 days ago The Best Markets For Residential Property Investors 2 days ago Xhevrije West is a talented writer and editor based in Dallas, Texas. She has worked for a number of publications including The Syracuse New Times, Dallas Flow Magazine, and Bellwethr Magazine. She completed her Bachelors at Alcorn State University and went on to complete her Masters at Syracuse University. Tagged with: First Mortgage Corporation RMBS Securities and Exchange Commission Settlements Issuer of Ginnie Mae RMBS Settles with SEC June 1, 2016 1,249 Views Data Provider Black Knight to Acquire Top of Mind 2 days ago Related Articles Demand Propels Home Prices Upward 2 days ago Share Save The Week Ahead: Nearing the Forbearance Exit 2 days ago Sign up for DS News Daily Previous: Will ‘Modest’ Economic Growth Deter the Fed? Next: ClosingCorp Names New VP of Sales, Strategic Relationships Governmental Measures Target Expanded Access to Affordable Housing 2 days ago  Print This Post “FMC and its senior executives abused their privileged access to Ginnie Mae’s securitization program by allowing greed to corrupt their business practices,” said Andrew Ceresney, Director of the SEC’s Division of Enforcement. “It is critical that we hold senior management fully accountable for this kind of misconduct, which we were able to accomplish here quickly due to the cooperation of company insiders.”First Mortgage was not immediately available for comment. Home / Daily Dose / Issuer of Ginnie Mae RMBS Settles with SEC First Mortgage Corporation RMBS Securities and Exchange Commission Settlements 2016-06-01 Brian Honea Servicers Navigate the Post-Pandemic World 2 days ago in Daily Dose, Featured, News The Best Markets For Residential Property Investors 2 days agolast_img


Leave a Reply

Your email address will not be published. Required fields are marked *

*
*