Closing Complex Loans Faster With a Digitized Client Workflow

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Home appraisal’s ugly history and uncertain future

This is Part I of a deep dive into the home appraisal industry. Today we explore the origins of the appraisal industry and its current lack of diversity.

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Federal Savings Bank CEO indicted for approving Manafort mortgages in attempt to land top job in Trump administration

Stephen Calk accused scheming with Paul Manafort in quid-pro-quo deal

Stephen Calk, the CEO and founder of the Federal Savings Bank of Chicago, was indicted Thursday for approving $16 million in mortgage loans for Paul Manafort in exchange for the former Trump campaign chairman’s help on landing a senior post with the administration.

According to the Department of Justice, Calk used his position as the head of a federally insured bank to issue millions in high-risk loans in a quid-pro-quo deal from which he would personally benefit.

In 2017, news of a possible scheme first came to light when it was revealed that the Federal Savings Bank lent Manafort millions of dollars, and a year later, Department of Justice special counsel Robert Mueller was said to be looking into the loan.

Now, official charges have been filed, alleging that Manafort approached Calk in late 2016 looking to borrow millions of dollars from the bank, which he urgently needed to stop or avoid foreclosure proceedings on multiple properties.

The DOJ alleges that while Manafort’s loans were pending, Calk provided him with a ranked list of the positions he wanted within the Trump administration, leading with secretary of the Department of the Treasury, and followed by deputy secretary of the Treasury, secretary of the Department of Commerce, secretary of the Department of Defense, and 19 ambassadorships similarly ranked, starting with the United Kingdom, France, Germany, and Italy.

The charges also state that Calk was aware of Manafort’s history of default and circumvented bank rules that would have inevitably denied the loan by acquiring a portion of the loan amount through the bank’s holding company, which he controlled as chairman and CEO.

In exchange, Manafort appointed Calk to an advisory committee for the Trump campaign and, after Trump was elected, recommended Calk for the job of under secretary of the Army, which he ultimately did not get.

The DOJ goes on to state that the Office of the Comptroller of the Currency flagged the loans made to Manafort as substandard and questioned the bank about its inappropriate classification, at which time Calk lied to regulators about his relationship with Manafort to cover his tracks.

When Manafort was indicted in October 2017, he stopped making payments on his loans, forcing the bank to foreclose on the cash collateral securing the loans – ultimately suffering a loss that totaled more than $12 million.

William F. Sweeney Jr., assistant director of the Federal Bureau of Investigation, said Calk went to great lengths to avoid banking violations in order to land a senior government position.

“He curried favor with an influential borrower, exploited his position as CEO of the bank and the holding company, and exercised control over the bank and the borrower’s loans, intentionally turning his back on the many red flags posted along the way,” Sweeney said. “His attempt at petitioning for political favors was unsuccessful in more ways than one – he didn’t get the job he wanted, and he compromised the one he had.”  

Calk is charged one count of financial institution bribery and faces up to 30 years in prison.

The Federal Savings Bank has removed his name on the leadership page of its website, listing instead John Calk as vice chairman and CEO. 

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