Yesterday Barry Minkow and the Fraud Discovery Institute released a report with another five lies told by Lennar Corporation (NYSE:LEN). This pattern of fraud and deception is being illustrated quite nicely. You can see the details of the five lies on a new website: www.Lie-nnar.com.
In summary, the report cites the following lies and misrepresentations:
- Breach of Contract and Fraud – Lennar’s lending subsidiary UAMC is being accused of fraud in a bankruptcy filing, based on the company’s aiding and abetting fraud by mortgage applicants and misrepresenting investments to First National Bank of Arizona.
- Mortgage Fraud and Whistleblower Retaliation – Former UAMC employee Trish Zurita has filed an employment claim, alleging that she was fired from her job for blowing the whistle on instances of mortgage fraud, and for not participating in the fraud, which included falsifying mortga application information and destroying negative credit information.
- Soil Conditions Fraudulently Concealed – Lennar management allegedly knew about expansive soil in the Hutto Park Development, yet build homes there anyway. The foundations of these homes are now cracking and the homes are sustaining damage because of it.
- A Decade of Fraudulently Concealing Soil Conditions – Lennar built homes on soil known to be expansive in Pinnacle Hill, and ended up paying $9 million to the homeowners because of it.
- Evidence of Financial Distress – Lennar’s financial statements as of 11/30/07 were showing significant weakness, which may have prompted them to seek a large infusion of cash… which they got when they sold part of the now-bankrupt LandSource project for over $700 million.
18 Mar 09 at 8:04 am
I have been defrauded by Lennar and UAMC…forced into a loan through deceptive and coercive practices. In short, I went to contract in 2004 and due to builder delays did not close until 2006. In the interim, I advised and showed proof that my financial condition dramatically changed. They threatened to keep my deposit, sue me and destroy my credit unless I closed even though I showed proof that I was no longer qualified. They immediately sold the loan they knew I could not pay. I obviously defaulted and am suffering severe economic and emotional hardship. I am bringing a suit but would love to know if others have had similar situations. I believe there has to be a pattern here and that it may even be a RICO violation.
02 Apr 09 at 1:31 pm
LENNAR IS PRESENTLY DOING WHAT IS CALLED ENGINEERED DIGGING OF FOUNDATIONS IN EAGLE SHADOW/THIS IS BEING DONE BECAUSE OF A SOIL PROBLEM.THEY DIG THE BASEMENTS OUT AT 20 FEET DEEP/ SUPPOSIDLY CONDITION THE SOIL AND THAN REPLACE IT. I WONDER IF THEY DISCLOSE THIS TO THE BUYERS? WOULD YOU BUY ONE OF THESE HOMES?