Wednesday, state Attorney General John Suthers announced that his office has reached a settlement with a Colorado Springs-based company, and several of its employees, over deceptive lending practices.
The company, Independence Planning, which did business as Alternative Lending of Colorado, and two of its top employees were at the center of the case. Independence Planning voluntarily dissolved on Dec. 1, 2009.
Under the settlement, approved by a Fremont County District Court judge, the company and its managing general partner, 65-year-old James Dale III, and top loan originator, 29-year-old April Bigler, have been ordered to pay more than $78,000 in fines and restitution.
“Irresponsible and deceptive lending practices certainly contributed to the foreclosure crisis Colorado and other states have faced over the past several years,” Attorney General John Suthers said. “This settlement and its terms should serve as a warning to mortgage originators that place their bottom line ahead of their responsibilities under Colorado law.”
According to the Attorney General's Office, the complaint agains the company and employees was filed in October 2009. It stated that Bigler engaged in deceptive trade practices, including misrepresenting loans’ interest rates, quoting monthly mortgage payments to consumers that did not include taxes and insurance costs, and delaying closings to pressure consumers into signing a mortgage.
The complaint also alleges that Bigler worked with appraisers to over-value homes, resulting in borrowers owing more on their homes than they were worth; failed to attend closings, which did not allow borrowers to ask questions about the terms of their loans; inflated borrowers’ incomes on their mortgage applications; and failed to provide timely, accurate or complete disclosures to borrowers. Dale is alleged to have known about Bigler’s misconduct and not taken any disciplinary action.
Under the settlement, Bigler will be assessed $33,770 in restitution and $14,000 in civil penalties. All but $10,800 of the total will be suspended if she complies with the terms of the settlement.
Under the settlement, Dale and Independence Planning will be assessed $16,885 in restitution and $14,000 in civil penalties. All but $7,200 of Dale and Independence Planning’s total also will be suspended if they comply with the terms of the settlement.
The settlement also requires that Bigler and Dale voluntarily surrender their mortgage loan originator licenses and notify the Office of the Attorney General if they intend to work in a mortgage-related business again.