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| Former employees of a defunct Indiana-based mortgage banker are accusing the company of fraud.
Janelle Franks has filed a lawsuit against Waterfield Mortgage for lost pay and benefits, compensatory and punitive damages and court costs, according to court documents filed in the Allen Superior Court. Franks was employed with the Fort Wayne-based lender as a client coordinator since 1998, according to the complaint. A former credit examiner for Waterfield, Cheri Steward, has also filed a similar suit as reported by The Journal Gazette. Neither Franks nor Steward could be reached for comment at the telephone numbers listed for them in the public directory. The complaint alleges that on January 13, employees were informed that the company was being sold to American Home Mortgage, to be finalized on January 20. Franks claims that representatives of Waterfield said if the employees remained with Waterfield they would be guaranteed pay and benefits through March 14, 2006, despite termination prior to that date. Franks was offered a different position with American Home, according to the complaint, but declined the offer with the understanding that she would still receive her wages and benefits through March 14, 2006. An e-mail, submitted as evidence shows that on January 17 Franks had asked Waterfield’s Human Resources Manager Deborah Schroeder if she was correct in assuming that her wages and benefits would continue even if she declined an offer from American. Schroeder reportedly replied, “Correct. It would be no different than if an employee declined an offer from any other outside company. However, I strongly advise you to make a decision before the date of the closing, which I believe is this Saturday. “If you decline an offer from AHM and you meet the conditions of our severance pay plan, you will still be eligible to receive severance and earned, unused vacation from Waterfield.“ On or about January 24, the complaint said, Schroeder gave Franks a signed letter informing her that her employment with Waterfield was terminated effective January 20 and outlining the reasons why. The letter explained that due to the sale of Waterfield and her denial of a different position with American Home, they had no choice but to end her employment. Schroeder noted in the letter that the position offered to Franks had included a modified work schedule, at Frank’s request and was still declined. It also stated, “any benefits you elected with Waterfield ended as of midnight on January 20, 2006. Information regarding continued health coverage will be mailed to your home.“ Requests for comment from American Home Mortgage were not returned. |
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Paula Parisot is a MortgageDaily.com feature reporter and a blogger at CloserBlog.com who has also worked in the mortgage industry. e-mail Paula at: PaulaParisot@MortgageDaily.com |
