Affiliated Mortgage is suing Envoy Mortgage, accusing the mortgage firm of stealing some if its key executives in an effort to put Affiliated’s correspondent lending division out of business, an article in The News-Star said.
On Friday, Affiliated Mortgage shut down its correspondent lending division, officially exiting correspondent lending.
“As you are aware, there have been significant changes within the mortgage industry that have impacted our business over the past several years. Based on the current environment, and after careful consideration, Affiliated Mortgage Company has made the difficult decision to exit the correspondent business,” said Jason Beene, president of the correspondent division.
But according to the article in The News-Star, there is a little more to the story.
Affiliated Mortgage is seeking more than $20 million in damages, with the civil lawsuit first filed in the 4th District Court more than a year ago, the article cited.
Among the defendants in addition to Envoy are company executives Daniel Hastings and William Cheney, who had been president and vice president, respectively, of Affiliated before leaving the company to start a correspondent lending division for Envoy in Monroe.
The lawsuit claims that Hastings, Cheney and others began “conspiring” with Envoy before they left Affiliated and removed Affiliated’s proprietary and confidential information, client and potential client lists and other documents and “trade secrets” before leaving the company.
Envoy rolled out its correspondent lending division in January 2013, which is based in Monroe, Louisiana.