Secondary Marketing Fraud

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1 · 11 · 09

Last month’s failure of a New Jersey mortgage firm initially appeared to the result of elevated repurchases. But firm’s chief surrendered this week amid charges the company was selling the same loans to multiple investors.

The Federal Bureau of Investigation released a statement Monday indicating that a criminal complaint was filed against David Findel, who has surrendered. He was charged with a single charge of wire fraud.

Findel is best know for his purchase of exclusive seats at a local football stadium, the news release said.

He is the president and chief executive officer of Worldwide Financial Resources, which collapsed last month. The Morganville, N.J., firm expanded from a financial planning company to a mortgage banker operating with a warehouse line-of-credit.

Initial reports indicated the collapse was the result of the firm being hit with more than $20 million in repurchase requests and losing its wholesale relationship with CitiMortgage.

According to the FBI, as Worldwide began experiencing a liquidity crisis in January 2008, Findel began to sell the same mortgages to multiple financial institutions. After the loans were sold, he would create duplicate loan files for fraudulent sale again.

Findel, who reportedly obtained $11 million through the secondary scheme, used the funds to pay corporate and personal expenses.

“This is a man who had it all,” Special FBI Agent In Charge Weysan Dun said in the announcement. “But what I find most remarkable is that despite his wealth and success, it simply wasn’t enough. Mr. Findel let greed beat him.”


Mortgage Daily Staff


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