MLN Arrest Warrant Sought

That company, InHome Capital LLC, describes itself on its Web site as “Your Full Service Mortgage Brokerage Company.”

But the two founders of MLN, which faces state Department of Banking penalties that could total near $8 million, are playing only consulting roles, according to reports.

One of the factors in considering any state license application that might be filed by Mitchell L. Heffernan, who was MLN’s president and CEO, or James E. Pedrick, who was MLN’s executive vice president, is that “MLN was uncooperative with the department in the early stages of the problem they had and that there were still charges outstanding in the cease and desist action, which would have to be resolved,” Connecticut Banking Commissioner Howard Pitkin told MortgageDaily.com. ‘There won’t be any talk of a license until that happens.”

MLN’s officials, he noted, still have failed to provide information that was requested as far back as Dec. 13, 2006.

But Pitkin, who noted he had heard reports of plans for the new mortgage company, said his comments applied only to Heffernan and Pedrick and not to any other former MLN officials who might seek a state license. The two founded MLN in 1997.

Those reportedly would be former MLN CFO Randy I. Roberge and former MLN CIO Michael S. Simeone, both of whom would become leaders of the new company, InHome Capital LLC. The LLC or limited liability company designation, is issued by the Secretary of the State of Connecticut — though a check with that office found that there was no company by that name listed in state corporate records.

An official in the department told MortgageDaily.com that a company has to be registered with the state in order to use the LLC designation.

An application for an arrest warrant against Heffernan has been filed by Connecticut’s Department of Labor in Superior Court in Middletown, according to Gary Pechie, director of the department’s Wage and Workplace Standards Division.

Heffernan faces possible arrest on 61 counts of failing to pay some $3 million in wages, mostly sales commissions of $5,000 to $300,000, the director said.

And the arrests of other former MLN officials could be sought, Pechie told MortgageDaily.com.

“We start at the top and then we work our way down. It’s an ongoing case,” he explained. “The law is very broad. We can arrest anybody who has anything to do with paychecks.”

Officials of Middletown, Conn.-based MLN have requested a hearing on the banking department charges and one is scheduled to be held on April 20, Pitkin said.

MLN, which has filed for bankruptcy, had 1,800 employees in 11 offices at eight locations in five states — Connecticut, Arizona, Georgia, Illinois and Pennsylvania — and was licensed in 26 states.

InHome Capital’s mostly-inactive Web site states, “currently under construction.”

A click on “careers” responds with a list consisting of loan officer development, employee benefits, and employment.

Some loan officers already have been hired, according to some reports.

“I don’t care where they’re located,” said Pitkin of the new company. “If they’re going to do any lending in Connecticut they would have to be licensed here.”

The state’s charges against MLN, which were filed in detail on Jan. 30, include failure to timely disburse loan proceeds for loans in Connecticut and other states, failure to close at least 23 loans for which it had issued commitments, and employing or retaining at least 40 unregistered loan originators. The state also revoked MLN’s license.