A convicted Chicago drug dealer was able to obtain a provisional mortgage loan originator's license from the State of Illinois just a few months before being sentenced to four years in prison.
DeAngelo McMahan, 31, was indicted in April 2004 after the FBI set up a sting operation to bust a gang of drug lords running the streets of Chicago's West side. McMahan was listed as one of the primary partners of an illegal drug organization, according to court documents.
It was around that time that McMahan was working as a loan officer for Homewood, Ill.-based American Premiere Mortgage making $5800 a month, according to bankruptcy documents filed with the United States Bankruptcy Courts.
It is unknown if McMahan was still employed with American Premiere when he reportedly received a provisional license from the state Department of Finance and Professional Regulation.
However, department spokeswoman Susan Hofer told MortgageDaily.com that as Illinois moved from its "no regulation" period to permanent licensing, it issued provisional licenses to all individuals employed by a mortgage company.
"In order to reach out to all the mortgage companies in the state, we asked them to give us a list of everyone who was working there," Hofer said.
All employees were required to be listed, Hofer explained, even it were the receptionist or mail clerk; it was a provisional license to begin the process to permanent licensing.
McMahan never received a permanent license, Hofer said.
Asked what the chances were of McMahan getting approved for a permanent license if he were not in prison, Hofer said it was a question she couldn't answer given that there are many variables to the approval process even for those who disobey the law.
"Every case is looked at (individually); the inclination is if someone is convicted of a crime of financial trust, there would be a much higher likelihood the person's license would be denied -- drug trafficking -- I don't know," Hofer said. "If it were fraud embezzlement or ID theft, those are the kinds of cases that would cause the license to not be approved."
Currently, to receive a loan originator license in the State of Illinois, it is required that the loan originator be gainfully employed, pass a standardized test, successfully complete a background check (both criminally and credit) and agree to a fingerprint check.