Henderson lender mum on licensing
A spokeswoman for CM Capital Services of Henderson had no comment Tuesday regarding a notice that Nevada regulators intend to revoke the license of the hard-money lender because it is insolvent.
The company manages $400 million in assets and recently was handling hard-money loans for 3,000 investors.
The company solicited money from investors and used the money to make loans to developers who provided real estate as collateral. Investors were attracted by double-digit interest rates and the relative security of holding real estate to secure the loans. In the last few years, the Southern Nevada real estate economy has crashed. Most development has halted and the value of hard-money loans backed by real estate has plunged as well.
Investors with CM Capital are angry about the way it managed the short-term loans and foreclosed real estate.
"Unfortunately, the MLD should have revoked CM's license over a year ago," Dean Altschuler, an accountant and CM Capital investor from Del Mar, Calif., said in an e-mail.
Altschuler estimated investors have lost more than $100 million because of default expense account loans. CM Capital set up the expense accounts and retained the right to foreclose on behalf of new lenders if investors fail to pay fees and expenses levied by CM. This will result in investors losing collateral for the loans.
Contact reporter John G. Edwards at
jedwards@reviewjournal.com or 702-383-0420.
