The mortgage company involved with savings-and-loan villain and convicted felon Michael Wise is going out of business.
St. Petersburg, Fla.-based CFIC Home Mortgage, with 350 branches in 48 states, is shutting its doors because it is having trouble acquiring the bonds required for its mortgage offices, said Chris Likens, owner of Prairie Village, Kan.-based Nations Holding Co., the parent of CFIC.
The mortgage industry is reeling after years of reckless lending practices and the end of the housing boom that it fueled. A website called “The Mortgage Lender Implode-O-Meter” counts 155 implosions since last year, including CFIC.
“Because Hartford withdrew from the (bonding) industry, it is becoming very difficult to get bonds,” Likens wrote to me in an e-mail. “Ours just happened to renew at a bad time.”
“Michael Wise,” Likens added, “was let go months ago” and had “no bearing on the current issue.”
As I first reported in May, Wise joined CFIC about five years ago after his release from a federal prison camp in Leavenworth, Kan. Wise served time after pleading guilty to wire fraud in 1999.
He’d allegedly stolen nearly $9 million from investors in his Aspen lending company and received a 3½-year sentence.
Wise also was a key figure in the 1988 collapse of Denver’s Silverado Savings & Loan, which grabbed headlines because it also involved Neil Bush, son of George H.W. Bush. Wise was acquitted of fraud charges, but regulators banned him from the S&L industry.
For reasons I may never understand, Likens gave Wise a job right out of Leavenworth. Likens is a generous philanthropist and owns the Kansas City Brigade arena football team. He told me he met Wise through an old friend who also served time in Leavenworth. Likens said he was a firm believer in second chances.
Wise did not directly work for CFIC, Likens told me, but worked at its holding company and kept an office in CFIC’s headquarters. Other people I talked to claimed Wise was running CFIC. He was there in the flesh but not on the official roster of executives.
“Everyone I talked to at CFIC told me he was running it,” said Robert Johnson of Thornton, who told me he took a job as CFIC’s compliance officer July 9 but was laid off July 27.
Is he gone, or isn’t he?
Some time after my column on Wise ran in May, Likens announced that Wise had been terminated – but even this seems uncertain.
“I never did find out what happened to Wise,” said Johnson, who said he was hired to try to fix some of CFIC’s issues.
“Most people told me he was gone, but then there were others who said he wasn’t far away,” Johnson said.
Wise declined to discuss his role at Nations Holding and CFIC on Thursday. “I really have nothing to say at this point,” he said when I called his cellphone.
Steve Hays, president of Apex Lending in Clearwater, Fla., told me he received a phone call from Wise, doing business on Likens’ behalf, a few weeks ago.
He said he also talked to Likens, who told him he was getting out of the mortgage business and wanted to know if Apex wanted any of CFIC’s branches.
“All Chris Likens told me was, ‘You can have the branches, no strings attached,”‘ Hays said. “He was just trying to do the admirable thing and find a home for these people.”
Hays took Likens’ offer and is taking some CFIC brokers under his wing, but he said he wants to make one thing clear:
“There’s no association, and I repeat, there’s no association, with Apex Lending and Mike Wise.”
CFIC has been getting hammered hard by state regulators for a few instances where it hired felons or did not properly license brokers.
In March, CFIC entered a consent order with Georgia regulators that resulted in the loss of its license in that state and a $193,000 fine.
In June, CFIC agreed to pay $848,000 to settle allegations by North Carolina regulators. “We will not allow mortgage companies to play fast and loose with our licensing requirements,” said North Carolina’s deputy commissioner of banks, Mark Pearce.
Some of CFIC’s independent brokers told me the company has frozen the bank accounts they used to run their offices.
Shaun Dickey of East Lansing, Mich., said he’s locked out of an account holding $26,000 of his own funds.
Beverly Connell, who worked as a CFIC branch manager in Georgia, said she would not have worked for CFIC had she known about Wise’s history.
When CFIC lost its license in Georgia, she had 32 loans in process and was expecting to receive $85,000 in fees that these would generate.
She had won a three-year lease on a BMW in an in- house sales contest. CFIC, however, has stopped making lease payments, sticking her with the tab, she said.
“I wish I’d never experienced CFIC,” she said. “It turned out to be the most costly mistake I’ve ever made in my life.”
Al Lewis’ column appears Sundays, Tuesdays and Fridays. Respond to Lewis at , 303-954-1967 or alewis@denverpost.com.
