Category Archives: Investing

Chicago mortgage originator accused of bilking elderly homeowners out of $7 million

A mortgage originator from Chicago stands accused of running a reverse mortgage scam and defrauding elderly homeowners and lenders out of $7 million.

According to the U.S. Attorney’s Office for the Northern District of Illinois, Mark Steven Diamond is a mortgage loan originator with offices in Chicago and Calumet City, Illinois.

Diamond is currently facing seven counts of wire fraud after being accused of fraudulently causing lenders to make reverse mortgage loans to homeowners who either did not sign up for the loans or did so after Diamond allegedly misrepresented the terms of the loans.

The indictment alleges that Diamond fraudulently kept the loan funds for himself after convincing title companies to give the checks to him instead of the homeowners.

According to the indictment, Diamond targeted his victims, who ranged from ages 62 to 97, based on how much equity they had in their homes and whether they were financially sophisticated or not.

Additionally, the indictment states that if one of the relatives of Diamond’s alleged victims questioned whether a reverse mortgage was a good idea, Diamond would visit the victim’s home at a time when he knew the relative would not be there.

All in all, Diamond allegedly defrauded the lenders and homeowners out of $7 million.

Diamond pleaded not guilty to the seven counts of wire fraud.

Also listed in the indictment is Cynthia Wallace, who allegedly solicited homeowners into agreeing to allow Diamond to perform home repairs on their homes, despite Wallace know that Diamond would not actually perform the work.

The indictment also states that Wallace used several aliases and posed as a representative of the Department of Housing and Urban Development to fraudulently obtain money from victims.

Wallace pleaded not guilty to nine counts of wire fraud and two counts of falsely pretending to be an employee of the United States.

The indictment also seeks the forfeiture of $7 million from Diamond.

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Feds announce 2017 list of distressed, underserved non-metro areas

On Wednesday, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency announced the 2017 list of distressed or underserved non-metro areas where banks can receive Community Reinvestment Act credit for certain activities.

Specifically, the agencies said the list covers the “distressed or underserved non-metropolitan middle-income geographies, where revitalization or stabilization activities are eligible to receive Community Reinvestment Act consideration under the community development definition.”

The areas as designated as distressed or underserved base on several factors including local economic conditions, unemployment, poverty, and population changes.

For more on the agencies methodology, click here.

As with previous years’ lists, the agencies allow for a one-year lag period for areas that were on the list in 2016 but are no longer designated as distressed or underserved on the 2017 list.

Click here for the full list for 2017.

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Alight closes $11 million funding round led by Caterpillar

Alight, a provider of industry-specific real-time financial optimization applications and a two-time winner of HousingWire’s HW Tech100, announced this week that it closed on a Series A round of funding, in which the company raised $11 million.

Leading the funding round was Caterpillar Venture Capital, a wholly owned subsidiary of Caterpillar, the construction and manufacturing giant.

Yes, you read that right.

Alight currently has two business verticals, mortgages and mining.

Alight’s Mortgage Solutions platform integrates into a lender’s general ledger, loan origination systems and capital market providers to create real-time financial forecasts and scenarios, whereas Alight’s Mining Solutions platform uses “enterprise-class, cloud-based applications (to) give mining executives the ability to forecast the future and immediately see the financial impact of every decision.”

According to a press release, “nearly 40 of the nation’s largest independent mortgage banking firms, including half of the firms in the top 10,” currently use Alight’s mortgage platform.

And now, Caterpillar’s venture capital arm is investing in the company and helping it expand.

“We’re always looking to invest in new ways that could help Caterpillar’s customers improve their profitability, especially through the use of technology,” said Jim Hawkins, managing director of mining technology for Caterpillar. “Alight’s technologies can allow our customers to see the financial impact of a machine or technology purchases as well as operational decisions before they’re made.”

Also taking part in the funding were a “consortium of noted Bay Area tech investors, led by Alight chairman, Steven Berger,” the company said in a release.

“We couldn’t be more excited to have Caterpillar as a strategic partner – it’s among the most innovative and transformational companies in the world and together, the industry and our customers will enjoy the power of a global leader coupled with speed and nimbleness that a company like Alight can apply when bringing new innovations to market,” Michele McGovern, Alight’s CEO, said. “It’s the perfect match.”

The company plans to use the $11 million raised in this funding round to grow its mining and mortgage industry verticals, and plans to expand into new industries.

The company said that it plans to add two new verticals in 2017, with pharmaceuticals scheduled to launch in the third quarter.

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