Officials post notice of intent to revoke lender’s license

The Nevada Mortgage Lending Division on Monday posted a notice of its intent to revoke the license of CM Capital Services, formerly known as Consolidated Mortgage, because the firm is insolvent.

Nancy Corbin, acting commissioner of the Mortgage Lending Division, also fined the Henderson-based hard-money lender $50,000 for violations of state law.

The notice comes one month after former Commissioner Joseph Waltuch accepted a $200,000 fine payment from CM Capital, plus $15,000 for attorneys' fees and investigative costs.

The payment was made the same day that Waltuch's termination was reported. However, Waltuch stayed a commissioner until the following week.

As part of the settlement, Todd Parriott, chief executive of CM Capital, agreed to provide the mortgage division with a financial statement, showing whether it was solvent, by Feb. 28. The division declined to comment after the deadline passed.

Clients of CM Capital have been furious about CM Capital's handling of their investments and several demanded that the division revoke the company mortgage brokerage license last summer.

Like other hard-money lenders, CM Capital solicited money from investors and used the money to make short-term loans to developers who provided real estate as collateral.

u2248t one point, CM Capital was managing $400 million in assets for 3,000 investors.

The hard-money lending business in Las Vegas has slowed to a crawl in recent years, as the value of Southern Nevada real estate crashed and developers ceased most activity here.

As a result, CM Capital foreclosed on many properties and was managing the properties for investors. Investors complained that the company was charging exorbitant fees for managing raw land and other properties.

The revocation notice filed Monday said that CM Capital was insolvent as long ago as September 2009 if intangible assets were subtracted. After the deduction, CM Capital's net worth was negative $10.2 million.

Then, in April 2009, the state received an audited financial statement that showed negative equity of $4 million even when intangible assets were included.