The U.S. Securities and Exchange Commission is probing The Change Company, a California lender that pledges to promote homeownership in underserved communities, over its mortgage-backed securities, according to people with direct knowledge of the matter.
As part the investigation, the regulator is also looking into some of the actions of its chief executive officer, Steven Sugarman, said the people, who asked not to be identified discussing the investigation that hasn’t been made public. Buyers of instruments backed by The Change Company’s loans have included some of Wall Street’s largest money managers, according to data compiled by Bloomberg.
“Neither Change nor its leadership is aware of any SEC investigation,” the firm said in a statement. “Loans included in Change’s mortgage-backed securities have been vetted by third-party due diligence firms who have issued certifications attesting to the accuracy of the data and sufficiency of the scope of their reviews,” the company added, in addition to providing an Aug. 24 attestation letter from an outside lawyer.
The SEC, which hasn’t accused anyone of wrongdoing in the matter and whose investigations don’t always lead to enforcement actions, declined to comment.
Source: nationalmortgagenews.com