There are all kinds of stories of mis-aligned incentives in the foreclosure process. Banks get very little money for modifying them, and it’s not even worth their trouble. Other foreclosure service providers get paid quite a lot and don’t want anything to slow down the process.
And then there’s this…
A Wells Fargo executive involved in foreclosed properties reportedly hosted parties and spent weekends at a $12 million Malibu property that had been surrendered to the bank.
A Madoff victim had to give up the home to pay debts, though it’s alleged that the bank wasn’t even letting prospective buyers take a look, perhaps because the executive was having such a good time partying in the home.
MALIBU, Calif. (AP) — A Wells Fargo & Co. executive who oversees foreclosed properties hosted parties and spent long summer weekends in a $12 million Malibu beach house, moving into the home just after it had been surrendered to Wells Fargo to satisfy debts, neighbours said.
The previous owners of the beachfront home in Malibu Colony — a densely built stretch of luxury homes that has been a favourite of celebrities over the years — were financially devastated in Bernard Madoff’s massive fraud scheme, real estate agent Irene Dazzan-Palmer said.
The couple signed the property over to Wells Fargo last spring, and the bank subsequently denied requests to show the house to prospective buyers, Dazzan-Palmer said.
Residents in the gated community told the Los Angeles Times that a woman they believe was Cheronda Guyton took up occupancy at the home in May. Residents said they obtained Guyton’s name from the community’s guards, who had issued her a homeowner’s parking pass.
Residents also wrote down the licence plate number of a 2007 Volvo sport-utility vehicle they say was parked in the home’s garage. A check of state motor vehicle licence plates by the Times found the vehicle was registered to Guyton.
Guyton is a Wells Fargo senior vice president responsible for foreclosed commercial properties, resident Phillip Roman said.
“It’s outrageous to take over a property like that, not make it available and then put someone from the bank in it,” said Roman, who lives a few homes away from the property.
Residents said Guyton, along with her husband and two children, often hosted guests at the home, including a large party the last weekend of August. Malibu Colony is about 25 miles from downtown Los Angeles.
Wells Fargo said in a written statement that it would conduct a thorough investigation of the allegations by neighbours, but said it wouldn’t “discuss specific team member situations/issues for privacy reasons.”
Guyton’s home number is unlisted, and attempts to reach her at her Los Angeles office after work hours were unsuccessful.
The bank’s agreement with the prior owner required it to keep the home — a 3,800-square-foot, two-story structure built in the early 1990s — off the market for a period of time, Wells Fargo said in the statement. The bank said it planned to list the property for sale soon.
Business Insider Emails & Alerts
Site highlights each day to your inbox.