Thursday, March 4, 2021
Home #OpISIS How The Subbing Works At HUD

How The Subbing Works At HUD

The US Department of Housing and Urban Development (HUD) is a classic case-in-point in contradiction. Award a Contract out, pull the Contract and then reissue the Contract to fellow competitors. This is the case of the Sentinel Field Services (SFS) Contract for Regions 4D and 5D (4D – Iowa, Nebraska, South Dakota and Wisconsin   5D – Minnesota, Montana North Dakota, and Wyoming) under the HUD Management and Marketing (M&M) Contract. Foreclosurepedia had released, back in April of this year, that HUD was going to take the action. It would appear that they finally did.

Sources speaking on condition of anonymity state that HUD Awarded 4D and 5D to Cityside which isn’t that much of a surprise considering the fact that Asset Management Specialists (AMS) are out of the game — in name at least. These Awards are to be in place until the HUD M&M 3.8 is rolled out.

Where the plot thickens is that we have two, as yet, unconfirmed emails intimating that Cityside may contemplate moving portions of the 4D and 5D underneath the 24 Asset Management umbrella which would theoretically be Assero, as well. If this turns out to be the case, Chris Dollof is going to be in for some seriously turbulent waters. My working theory, though, would be that Dan Hansen’s head would be the one to roll. So, why is it that I have formulated this opinion?

When Concentric Equity Partners (CEP) and TDR Capital bought out Mortgage Contracting Services (MCS), Asset Management Specialists and Vacant Property Specialists (VPS), Caroline Reeves was appointed over the entirety and cleaned house by wiping out the HUD AMS Leadership. This put HUD in a pickle. On the one hand, HUD had created a regulation known as HUD 5.1.12.5 to deal with the Innotion – Safeguard Properties quandary under HUD M&M 3.0 and thus it was the law of the land. With Reeves handling both pre conveyance under the MCS roof and HUD under the AMS roof, this was a classic violation — or potential for violation — of HUD 5.1.12.5.

HUD knew, though, that Reeves was a hard nut to crack and that if they publicly relied upon HUD 5.1.12.5 they would become involved in protracted litigation. In fact, Foreclosurepedia filed two Freedom of Information Act (FOIA) requests, as a Media Outlet, dealing with this precise issue of which HUD answered one and invoked privilege on the other. HUD knew, then and there, that they were between a rock and a hard spot.

Although never publicly released, the reality is that HUD went with the theory that with Ernie Stepkovic gone, the Contracts between AMS and HUD were null and void. While I would have gone with the slam dunk of HUD 5.1.12.5 to finally solidify the regulation as the Law of the Land, I presume that either Craig Karnes or his folks up at the Office of the General Counsel, Kevin Simpson, et al., didn’t have the stomach for it.

Concentric Equity Partners (CEP) and foreign nationally owned TDR Capital (TDR) recently announced the formation of a new holding company to establish a suite of mortgage field services companies comprising Mortgage Contracting Services, LLC (MCS), Asset Management Specialists, Inc. (AMS) and Vacant Property Specialists, LLC (VPS). This cluster is legally known as MCS AMS Sub Holdings LLC which is holding more than $360 million of rated debtStandard and Poor’s (S&P) Xpress Credit Research are FAR LESS enthusiastic than Moody’s view of the debt laden Reeves Portfolio. In fact, S&P anticipates default by MCS AMS Sub Holdings LLC. The stark facts are that we are beginning to see a To Big To Fail Model spinning up.

We have assigned preliminary recovery ratings to MCS AMS Sub-Holdings LLC-s proposed $20 million revolving credit facility and $340 million term loan. Our recovery analysis contemplates a simulated default occurring in 2016 due to a steep decline in revenue and operating earnings, the result of a decline in foreclosure activity and customer attrition. [Emphasis Added By Editor] Our default scenario assumes MCS AMS would reorganize in the event of a payment default. We have therefore valued the company as a going concern, using a 5x emergence multiple.

So, back to our original protagonist, Eduardo San Roman. San Roman, owner of 24 Asset Management — at least in name — bought himself a nicely packaged bag of shit when he brought on Lee Mertins & Co. Mertins and Brian Nesbit (Mertins & Co.) put the L in liability. While at AMS, Mertins was the mind behind such productions as the HUD P260 Screen Shot Debacle, the duality in statistics; public facing and otherwise which came to a head when Foreclosurepedia interceded on behalf of Bennett Vinson with Salim Wilsom, and allegedly the man behind Electronic Monitoring System (EMS),  and Vorticity with Vorticity simply being the rebranded conglomeration — more on this in a minute. Mertins and former AMS owner Ernie Stepkovic are day and night. The reality, though, is that by the end of the roadshow, Stepkovic was unable to clean up the treachery Mertins had spun up.

Mertins is a man whom fancies himself as a coder — a noob as we call his type. Idolizing Mark Zuckerberg, Mertins really bought into the fact that his reading up on Spatial Logic and Perl would allow him to become the Zuckerberg of the Mortgage Field Services Industry — see generally the Visneta bullshit San Roman and Mertins went in on. As a sidenote, Visneta markets itself thus, “Visneta is like a dating service for everyone in the real estate industry.” There was one fatal flaw with Mertins — really 1,098 flaws, but whom is counting?! — and that was the fact that like everything in life Mertins did, he simply emulated what he saw. The Diagnostics and Statistical Manual have several features covering this behavior and they were mentioned in my psych profile I maintain on most executives over on ISTAR Clear Base.

Mertins, much like a snake oil peddler, was dependent upon a coder. Mertins’ coder’s name was Krishna Gnanasekaran. Gnanasekaran, while talented in what he did, it appears that he wasn’t too hip to go down dark roads where the Light at the End of the Tunnel Was Permanently Shut Off. Now, this is where I reel in, somewhat, my words and simply state that Carolyn Reeves would do CEP and TDR Capital well in studying, with great detail, the IT Logs. If Reeves, et al., believe that simply a few forms ended up on Visneta, well I have some investment properties to sell her in the stable, up and coming New Syria!

When Eduardo San Roman woke up the other day and began to read Foreclosurepedia — yes, I maintain logs and DILIGENTLY check and cross reference them for entry into ISTAR Clear Base — I like to think that the reality of his decisions began to come crashing in. I cannot condemn him for attempting to bring on his competitor’s employees and capitalize upon their Time in Rank which allowed Assero to make bids on the upcoming HUD M&M Contracts. Hell, everyone does that anymore. What I condemn him for and what will ultimately crucify he and the flagship 24 Asset Management is the simple fact of failing to perform Due Diligence.

San Roman, like many others in the Mortgage Field Services Industry, seems to believe that: a) Background Checks are for Contractors only; and b) Aspen Grove Solutions knows what the fuck they are doing. This misguided belief is what got Altisource in the tremendous world of shit they are currently in to the tune of nearly a million dollars.

On the Atisource note, we are also tracking a story wherein Shane Hilde, an Altisource Inspector an I use that term loosely, has been shaking down Contractors for free work. Apparently, when not shaking the Contractors down, he is screaming at 18 year old girls and spewing his vitriol to the point that she and others not only felt threatened and intimidated, but causing other secretaries to break down in  tears. Formal complaints have fallen upon deaf ears, as usual. I mean it never changes with these people. This, though, is crossing one of the Red Lines in life. More on this fast developing story later tonight.

San Roman now has a duality of problems. First, San Roman, if in fact Cityside or anyone moves HUD work under his umbrella has to worry about whether or not HUD 5.1.12.5 will ever be invoked against the 24 Asset Management banquet of companies. Second, San Roman has to now worry about the fact that many of the Contractors originally fucked by Mertins & Co. over at AMS are being asked to bend over for him again.

The HUD 5.1.12.5 issue is easily addressed by a few envelopes passed around no matter when it may arise. The Mertins & Co. issue, though, is not as easy. First, San Roman has been recalcitrant to address the issue of Mertins & Co. This has telegraphed to Labor that San Roman does not care how Contractors are treated; this intimates to me at least, that San Roman appears to be unconcerned with the potential of atrocities committed against Contractors. We are already seeing the quiet rumblings against 24 Asset Management. Now, I am sure that Mertins & Co. have a public facing set of statistics which counter this as he did over at AMS, but the reality is that the emails are not wrong. More on point, though, the Government Sponsored Enterprises (GSE), Financial Institutions and Portfolio Holders whom are reading this now have to assess their liability position. With their IP Addresses now logged, the ability to state that they did not know is no longer an option.

Foreclosurepedia would love the chance to speak with San Roman and see whether or not he is going to be able to bring Mertins & Co. under control. Actually, Foreclosurepedia would far rather report that Mertins & Co. are gone. The reality is that Nesbit is a Yes Man and not exactly what I would call an independent thinker as I understand from others. From what I can tell, San Roman is not cut of the same cloth Mertins & Co. are and that is tragic. The ball, though lies in San Roman’s court.

So, yet another page in the HUD M&M Chapter. It is sad, really. The HUD Office of the Inspector General has a plethora of investigations that all end with the offenders writing their own sanctions — the sanctions actually ended up being pay raises in some cases. HUD always has an always will be a corrupt portion of the US Government. Even beyond the fact that Foreclosurepedia has documented mountains of evidence which HUD refuses to investigate, the reality is that compelling financial institutions to make loans backed by tax payer dollars to homeowners whom are not capable of paying off their loans, is the epitome of insanity. Why would anyone expect anything different in how HUD runs the rest of its programs.

Paul Williamshttps://foreclosurepedia.org
Linux addict buried deep in the mountains of East Tennessee.

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