Eduardo San Roman’s Award of 10 — count them TEN — US Department of Housing and Urban Development‘s (HUD) Management and Marketing (M&M) Field Service Manager (FSM) contracts may be coming back to haunt 24 Asset Management. In the multi-million dollar award of 86616022D00008, what 24 Asset Management didn’t see coming was both the ratification of California’s AB5 along with a potential investigation of unfair trade practices under § 7195 California Business & Professions Code — Home Inspectors. And while many may believe that Eddie and the boys have it covered, the reality is that Lee Mertins, the shot caller at the infamous Assero, is at the helm these days at 24 AM and his playbook isn’t looking too good.
§ 7195 California Business & Professions Code — Home Inspectors
7197. (a) It is an unfair business practice for a home inspector, a company that employs the inspector, or a company that is controlled by a company that also has a financial interest in a company employing a home inspector, to do any of the following: (1) To perform or offer to perform, for an additional fee, any repairs to a structure on which the inspector, or the inspector’s company, has prepared a home inspection report in the past 12 months.
Section 7197 (a)(1) is pretty clear in its intent. In layman’s terms, a company that hires an inspector to do an inspection on any property is not allowed to perform any repairs on that same property for a period of 12 months. And while AB2257 now exempts inspectors from the ABC test — AB5’s scrutiny test — it does not exempt those performing other services such as lawn maintenance, completion of HPIRs, winterizations, or any other service generally rendered upon any pre or post conveyance property. And there is still that pesky Section 7197 stating that virtually all National Association of Mortgage Field Services (NAMFS) members are involved in unfair trade practices in the State of California.
Since at least 2010 NAMFS members including their Executive Director Eric Miller, have known that they have been misclassifying employees as independent contractors. Building upon Foreclosurepedia’s reporting, dating back to 2012, NAMFS members have known that they have purposefully misclassified employees for over two decades. Beginning with Hurst v Buczek Enterprises wherein Buczek Enterprises paid Field Service Technician Brad Hurst “six figures” to settle a claim of employee misclassification and continuing with the Vinson Settlement wherein Mortgage Contracting Services (MCS) — or Make Communities Shine if you buy into their Mr Cooper type rebranding — then a subsidiary of VPS Holdings LTD and now owned outright by Littlejohn, paid millions to keep Field Service Technician Bennett Vinson silent, the Mortgage Field Services Industry is reeling and many are asking why Eric Miller refused to allow discussions with respect to this subject. Recently, in the Bowerman jury verdicts, 7 out of roughly 150 cases found awards of $2.2 Million against Assurant Field Asset Services (AFAS) whom was purchased by Xome, a Mr Cooper subsidiary which was, in turn, sold to Cyprexx.
The rebranding theme kicked in hard after the volumes from the 2008 Financial Crisis began to tank and the fraud committed against Labor had escalated to all time highs. Whether it be the Ameritrust to ResiPro debacle which came down as D&B downgraded their status to a “HIGH Risk” of default and culminated by allegations of millions of dollars swindled from Hudson Homes. The panic became more widespread in their more egregious attacks upon their own vendor managers vis-à-vis suing them and reaping the insurance benefits as well documented in the information submitted to Foreclosurepedia by a former ResiPro Contract Manager, it goes without saying that profit is pocketed by the firms as liability is ladled out on the shoulders of their employees and Labor. Even Altisource kicked into high gear changing virtually all of their names to innocuous ones such as Trelix and Front Porch.
As the State of California begins to drill down fervently upon NAMFS members operating in their state — not so much to protect Labor, but rather to get money back in their coffers — Labor ought to best be aware of the scheme that they could be inserting themselves into. A simple read through recent litigation in Florida recently settled out of court, based on nearly identical tactics used by Lee Mertins for years, is enough to dissuade most logical people,
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