The Mississippi Department of Banking and Consumer Finance has suspended a Meridian mortgage company’s license for three years and imposed a $10,000 fine.
The department’s commissioner, John S. Allison, on Wednesday announced the terms of a settlement reached with Mid-South Mortgage & Investments and its president, David Hand.
The settlement comes after an order issued April 26 directing Hand to suspend business operations. The mortgage company operated under the name Freedom Lending, with offices at 302 17th St., Suite D.
“We had some suspicions, which were solidified by complaints,” Allison said. “That’s when we issued the cease-and-desist order.”
Hand waived his right to a hearing in the matter and entered into settlement discussions with the Department of Banking and Consumer Finance in May.
A consent order issued by Allison outlines the allegations against Hand and the conditions to which he has agreed.
It alleges that Freedom Lending executed two different and conflicting Housing and Urban Development settlement statements and sales contracts on at least six mortgages. The borrowers in these instances were Tahria Creagh, Marvin Horn, Mary L. Thomas, Annie and Kenneth Williams, Roderick Portis and Tammie L. Pack.
It also alleges that the mortgage company “directed the destruction and concealment of certain records and files to cover up the fraudulent and improper actions.”
Hand neither admits nor denies the allegations. His attorney, Bill Ready Jr., said Wednesday Hand entered into settlement discussions to keep from incurring more costs for Mid-South Mortgage & Investments and the state of Mississippi.
“This consent order is purely an administrative remedy. There is no finding of any criminal wrong-doing,” Ready said.
Freedom Lending’s three-year suspension went into effect on Monday. The settlement agreement allows Hand to complete any mortgage transactions already in process — but bars him from taking on any new business.
The $10,000 fine must be paid within 30 days.
This marks the second time in a year that the Department of Banking and Consumer Finance has penalized a Meridian mortgage broker.
In November, Allison took similar action against Hare Mortgage and its owner, Rhonda Hare. As with Freedom Lending, Allison suspended Hare’s license for three years and fined her $10,000. Hare also waived her right to a formal hearing, choosing instead to negotiate a settlement.
In that case, Hare allegedly falsified documents and charged home buyers inflated broker fees. Like Hand, Hare did not admit to any wrong-doing as she agreed to a settlement.
Attorney General Jim Hood subsequently charged Hare and an employee of her company, Linda Stephens, with six counts of mail fraud and one count of conspiracy to commit a crime. The criminal charges came in April, and both women now face possible indictment by a Lauderdale County grand jury.
While Allison would not comment on whether Hand will face criminal prosecution, he said the indictment, if it comes, could be handed down by a federal grand jury in U.S. District Court. The reason, he said, is because the documents involved in the allegations are from Housing and Urban Development — and HUD is a federal agency.
For more information, visit the Department of Banking and Consumer Finance’s Web site at www.dbcf.state.ms.us.
Local News
Freedom Lending’s license suspended
$10,000 fine levied
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