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ANDREW WIEDERHORN – a Jail Bird and Wilshire Credit Corp. CEO


Please review how shady this CEO is here

This thug did time in jail and he also started Wilshire Credit Corp.

He’s from Portland, Oregon. He founded Wilshire Credit Corporation and served as its CEO, by the age of 32 amassing a fortune estimated to be worth $140 million.[1] Currently he is CEO and majority shareholder in Fog Cutter Capital, which had been listed for a time on NASDAQ (ticker symbol FCCG).

Wiederhorn founded Fog Cutter Capital after the 
following questionable investments involving union retirement funds.[2] However, US law enforcement continued a criminal investigation into Wiederhorn’s activities while at Wilshire Credit, which was ended when Wiederhorn pleaded guilty to filing a false tax return and paying Jeffrey Grayson, the head of Capital Consultants, an “illegal gratuity” in return for a 12-month sentence and payment of $4.6 million in fines.[3]

The controversy around Wiederhorn continued when the board of directors of Fog Cutter voted to give Wiederhorn a bonus equal to the fine he paid the US government, and paid his salary during his incarceration—despite Federal rules that a convict can not engage in business dealings while imprisoned. The immediate result was that NASDAQ delisted Fog Cutter; since 14 October 2004 the corporation’s shares have been traded on the pink sheets.[4] In addition Ernst & Young, the company’s independent auditors, quit on 16 July 2004; the company has since hired a local auditing firm to audit its books.

The long-term result was that Wiederhorn had his membership in the influential Multnomah Athletic Club suspended in October 2004. The Wall Street Journal described the Club as “the premier social center for executives, politicians and socialities in this city of more than half a million.”[5] After finishing his sentence, Wiederhorn has initiated a legal fight against the Club, claiming that it has treated him unfairly and that other Multnomah Athletic Club members who have committed crimes were not disciplined as harshly as him. One example he cited was his former business associate Lawrence Mendelsohn, who pleaded guilty in the same case involving Capital Consultants, but served no jail time.[6]


January 8, 2010 Posted by | News, Wilshire Credit Corporation | Leave a comment

Business Week’s snapshot of Wilshire Credit Corp.

Wilshire Credit Corporation

Company Overview

Wilshire Credit Corporation operates as a specialty loan servicing company in the United States. It involves in servicing of residential mortgage loans. The company was founded in 1987 and is based in Beaverton, Oregon. As of May 3, 2004, Wilshire Credit Corporation operates as a subsidiary of BofA Merrill Lynch Mortgage Capital Inc.

14523 S.W. Millikan Way

Suite 200

Beaverton, OR 97005

United States

Founded in 1987





Key Executives

Age: 47
Chief Investment Officer and Senior Vice President of Loan Operations
Senior Vice President of Loan Servicing
Chief Information Officer
Age: 45
Chief Technology Officer
Compensation as of Fiscal Year 2009.

Similar Private Companies By Industry

Company Name Region
Midland Federal Savings and Loan Association United States
Prime Rate Lending Group, Inc. United States
SCB Bank United States
Coatesville Savings Bank United States
The First, A National Banking Association United States

Recent Private Companies Transactions

October 5, 2009

January 8, 2010 Posted by | News, Wilshire Credit Corporation | Leave a comment




Civil Action No. H-08-3389.

United States District Court, S.D. Texas, Houston Division.

May 19, 2009.


NANCY F. ATLAS, District Judge.

This case is before the Court on the Motion for Summary Judgment (“Motion”) [Doc. # 16] filed by Defendant Wilshire Credit Corporation (“Wilshire”).[ 1 ] Plaintiff Clarence Dean Lacy filed a Response [Doc. # 18] in opposition to Defendant’s Motion. Defendant neither filed a Reply nor requested additional time to do so. Having reviewed the full record and applied governing legal authorities, the Court denies Defendant’s Motion.


Plaintiff purchased a tract of property in College Station, Texas, in 1993. In connection with the purchase, Plaintiff executed a promissory note and deed of trust. Eventually, the servicing of the loan was transferred to Defendant.

Plaintiff fell behind on his loan payments during a family emergency. After the emergency was resolved, Plaintiff contacted Wilshire to ask how much he needed to pay to bring the note current. Plaintiff alleges, supported by his own affidavit, that Wilshire’s employee told him that the note was current. See Plaintiff’s Affidavit, Exh. A to Response, ¶ 6. At that point, Plaintiff believed that his father had made the payments on his behalf during the period of emergency. See id. Defendant claims, supported by its evidence, that its employee told Plaintiff that the loan was on hold and that there was “no tad (total amount due)” and told him to call again the following week. See Affidavit of Danny Tye, Exh. A to Defendant’s Motion, ¶ 9.

Plaintiff alleges that in October 2007, he discovered that a Non-Judicial Foreclosure Sale was held for his property in August 2007. The property was sold for $81,541.17. Plaintiff asserts that he would have brought the loan current had he known that it was delinquent and would, thereby, have avoided the foreclosure and sale.

On September 30, 2008, Plaintiff filed this lawsuit in Texas state court alleging negligent misrepresentation and fraud by Wilshire. On November 12, 2008, Defendant filed a timely Notice of Removal, removing the lawsuit to this Court. The Court conducted the initial pretrial and scheduling conference on January 26, 2009, establishing October 26, 2009, as the deadline for the parties to complete discovery. On April 9, 2009, Defendant filed its Motion for Summary Judgment. Defendant argues that the summary judgment evidence establishes conclusively that Wilshire never represented to Plaintiff that the loan was current and that there was no fraud. The Motion is now ripe for decision.


Summary judgment is proper only if the pleadings, depositions, answers to interrogatories, and admissions on file, together with any affidavits filed in support of the motion, show that there is no genuine issue as to any material fact, and that the moving party is entitled to judgment as a matter of law. FED. R. CIV. P. 56(c). The moving party bears the burden of demonstrating that there is no evidence to support the nonmoving party’s case. Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986); Nat’l Union Fire Ins. Co. v. Puget Plastics Corp., 532 F.3d 398, 401 (5th Cir. 2008). If the moving party meets this initial burden, the burden shifts to the nonmovant to set forth specific facts showing the existence of a genuine issue for trial. See Hines v. Henson, 293 F. App’x 261, 262 (5th Cir. 2008) (citing Pegram v. Honeywell, Inc., 361 F.3d 272, 278 (5th Cir. 2004)). The Court construes all facts and considers all evidence in the light most favorable to the nonmoving party. Nat’l Union, 532 F.3d at 401.


Plaintiff asserts claims against Wilshire for negligent misrepresentation and fraud, and Wilshire seeks summary judgment on each of these claims.

“Negligent misrepresentation requires proof that: (1) the defendant in the course of his business or a transaction in which he had an interest; (2) supplied false information for the guidance of others; (3) without exercising reasonable care or competence in communicating the information; (4) the plaintiff justifiably relied on the information; (5) proximately causing the plaintiff’s injury.” Kastner v. Jenkens & Gilchrist, P.C., 231 S.W.3d 571, 577 (Tex. App. — Dallas 2007, no pet.); see also In Re Stonebridge Techs., Inc., 430 F.3d 260, 267 n.4 (5th Cir. 2005). Plaintiff has presented evidence that Wilshire in the course of its business misrepresented to Plaintiff that his loan was current, that Plaintiff justifiably relied on that information in not making additional payments at that time, and that Plaintiff was injured as a result of the misrepresentation because his property was sold at foreclosure. See Plaintiff’s Affidavit, ¶¶ 6-8, 11. Plaintiff’s evidence raises a genuine issue of material fact precluding summary judgment on the negligent misrepresentation claim.

Under Texas law, the elements of a fraud cause of action are: (1) a material representation was made; (2) it was false when made; (3) the speaker either knew it was false, or made it without knowledge of its truth; (4) the speaker made it with the intent that it should be acted upon; (5) the party acted in reliance; and (6) the party was injured as a result. Herrmann Holdings Ltd. v. Lucent Techs. Inc., 302 F.3d 552, 563 n.3 (5th 2002) (citing Formosa Plastics Corp. USA v. Presidio Eng’rs & Contractors, Inc., 960 S.W.2d 41, 47 (Tex. 1998)). Plaintiff has presented evidence that Wilshire represented to him that his loan was current, that the representation was incorrect, that the Wilshire employee who made the representation either knew it was incorrect or did not know whether it was correct, that the Wilshire employee knew that Plaintiff would act on the information he provided, and that Plaintiff in fact relied on the information by not making additional payments on the loan at that time. See Plaintiff’s Affidavit, ¶¶ 6-8, 11. Plaintiff has also presented evidence that he was injured as a result of his reliance on the misrepresentation because the property was sold at foreclosure. Plaintiff’s evidence raises a genuine issue of material fact as to the fraud claim. As a result, summary judgment is inappropriate and must be denied.


Plaintiff has presented evidence that raises a genuine issue of material fact as to his fraud and negligent misrepresentation claims. Accordingly, it is hereby

ORDERED that Defendant’s Motion for Summary Judgment [Doc. # 16] is DENIED. It is further

ORDERED that Plaintiff’s Motion to Strike Defendant’s Summary Judgment Evidence [Doc. # 19] and Motion for Continuance [Doc. # 20] are DENIED AS MOOT.

1. Also pending are Plaintiff’s Motion to Strike Defendant’s Summary Judgment Evidence [Doc. # 19] and Motion for Continuance [Doc. # 20] seeking additional time to respond to Defendant’s Motion for Summary Judgment. Defendant filed a Response [Doc. # 21] opposing Plaintiff’s Motion for a Continuance. Because the Court has not considered any evidence that is not properly considered for summary judgment purposes, and because Plaintiff filed a full and timely response to Defendant’s Motion for Summary Judgment, each of Plaintiff’s motions are denied as moot.


This copy provided by Leagle, Inc.

January 7, 2010 Posted by | Forclosure Lawsuits, Foreclosure Filings - General, Wilshire Credit Corporation | Leave a comment

Grant funds classes to help homeowners

Grant funds classes to help homeowners

January 07, 2010

HYANNIS — The Hyannis-based Housing Assistance Corp. has received a $5,000 grant to help fund financial literacy education efforts.

The money, awarded by the office of state Attorney General Martha Coakley, is part of a $1.1 million grant program intended to support educational efforts that will help homeowners better understand budgeting, recognize predatory lending and avoid foreclosure.

The Housing Assistance Corp. will use its grant to implement a new curriculum addressing subjects like income and expenses, credit, financing options for home buying and the benefits of renting rather than buying.

“It’s so people can identify up front, before they start down the home-buying pathway, whether they are ready for homeownership,” said Nancy Davison, vice president of operations for the agency.

The grant money should allow the organization to offer its new program three or four times this year, Davison said. The first class is scheduled for March.

The grant money comes from a $10 million settlement between Coakley’s office and Fremont Investment and Loan, stemming from charges that the California-based lender engaged in unfair and deceptive lending practices.


January 7, 2010 Posted by | Fremont Investment & Loan, News | 1 Comment

Wilshire has been named as a defendant in dozens of lawsuits filed in the past two years.

 By John Letzing

International Business Machines Corp. (IBM) has been many things during its century-long history: purveyor of meat slicers and weighing scales, record-keeper for a brand-new U.S. Social Security system, and maker of personal computers, to name a few.

But one of the newest incarnations for Big Blue–supporting the servicing of relatively risky, subprime home loans–presents a unique opportunity to profit from a dubious segment of the mortgage industry.

IBM announced its acquisition of Wilshire Credit Corp.’s assets and employees from Bank of America Corp. (BAC) in October.

According to data from SourceMedia, Wilshire ranked 15th in terms of subprime loan servicing volume in the U.S. as of Sept. 30, at an estimated $21 billion. Terms of IBM’s purchase of Wilshire were not disclosed, and IBM doesn’t expect the deal to close before the first quarter of 2010.

IBM said in a statement at the time that Wilshire’s servicing rights would remain with Bank of America. However, industry observers are unsure about the technology giant’s precise plans for integrating Wilshire, which has been privy to both the significant upside and ugly downside of the subprime loan business.

Subprime loans triggered a credit crunch in 2007, which grew into last year’s global economic meltdown. The loans generally involve higher interest rates but are also made to borrowers considered more at risk of defaulting. Following years of boom times, a cascade of defaults helped put credit markets into a deep freeze, from which they’re only now starting to emerge.

Mortgage servicers collect payments, assess penalties and make modifications–reducing monthly installments, for example. Though generally insulated from loan defaults, servicers also do the dirty work of foreclosing on homes. Wilshire is named as a defendant in several civil lawsuits, alleging that it played a role in predatory lending schemes.

“There’s a lot of litigation risk” in servicing mortgages, said Mark Calabria, director of financial regulation studies at the Cato Institute. “I have to assume [IBM’s] general counsel’s office has gone through this, and is comfortable.”

An IBM representative declined to comment for this story.

However, the company’s acquisition of Wilshire enhances its ability to benefit handsomely from an upswing in mortgage servicing. A wave of modifications is anticipated, as subprime borrowers in dire straits seek out help. That in turn could create new demand for data and analysis, which IBM could address with its technology.

    From Backwater To The Spotlight

With the sudden and pressing need to essentially re-do hundreds of thousands of loans, the formerly sleepy business of mortgage servicing has been pulled into the spotlight.

Mortgage servicing was seen as a “backwater” prior to the real estate boom and bust, the Cato Institute’s Calabria said. Now, however, there is increasing demand for technology that could help make smarter decisions about which mortgages to modify, and to what degree.

“You want to try to get some indication of who you need to call, before you get in trouble,” Calabria said.

Paul Leonard, director of the California office of the Center for Responsible Lending, said that as more distressed homeowners seek modifications, market players will naturally seek better and faster infrastructure. “The servicing industry has been struggling to keep up with a tsunami of activity,” Leonard said.

IBM’s interest in loan modifications predates the Wilshire acquisition. In March, the company announced an offering that enables servicers to quickly process requests, for example, and it has offered technology outsourcing to the mortgage industry for years.

But with Wilshire, IBM is acquiring the assets of an entity that’s become a conspicuous target for irate homeowners.

Wilshire has been named as a defendant in dozens of lawsuits filed in the past two years. In a fairly typical suit filed in U.S. District Court for the Southern District of California in August, homeowners in San Marcos allege that their “usurious” loan was knowingly based on inflated income, and came with undisclosed finance charges.

The plaintiffs claim “severe emotional distress,” and damages in excess of $500,000. They argue that the defendants’ conduct “amounted to malice,” and note that their home was slated for a foreclosure sale.

While the underwriting of such subprime loans are now “virtually non-existent,” the body of existing loans still needs a lot of work, said TowerGroup analyst Craig Focardi. In addition, IBM could now expand Wilshire’s assets to cover less-risky home loans, Focardi said.

“Given IBM’s IT assets and mortgage expertise, they’ve got the ability to expand the capabilities of the Wilshire platform to prime credit loans,” he said.

Wilshire was acquired by Merrill Lynch & Co. in 2004, and then inherited by Bank of America as part of a hasty merger between that firm and Merrill Lynch amid the chaos of last year’s Wall Street meltdown.

The Wilshire acquisition “further demonstrates IBM’s commitment to delivering robust and innovative mortgage solutions during a difficult time for the mortgage industry,” IBM said in a statement in October.

-By John Letzing, 415-439-6400;

January 7, 2010 Posted by | News, Wilshire Credit Corporation | 2 Comments