More bad news for Beazer
The Atlanta homebuilder issued the latest in a steady trickle of bad news Wednesday evening, conceding for the first time the existence of "certain evidence" that its mortgage operation violated federal lending rules.The company also said "negative publicity" about its conduct is scaring away potential homebuyers, suppliers and even some employees -- and that it is increasingly difficult for Beazer to hire qualified replacements...The company's problems began with a Charlotte Observer series charting problems with the company's aggressive sales tactics.
Another day, another disclosure by Beazer Homes USA.
The Atlanta homebuilder issued the latest in a steady trickle of bad news Wednesday evening, conceding for the first time the existence of "certain evidence" that its mortgage operation violated federal lending rules.
The company also said "negative publicity" about its conduct is scaring away potential homebuyers, suppliers and even some employees -- and that it is increasingly difficult for Beazer to hire qualified replacements.
The filing with the Securities and Exchange Commission was intended to bolster investor confidence. Beazer cannot file its latest quarterly financial statement because it is investigating problems with past filings. It filed an informal statement instead.
Beazer is the subject of a federal criminal investigation and a formal inquiry by the Securities and Exchange Commission, along with lawsuits filed by shareholders, customers and employees. Its board is also conducting an internal investigation. The company's problems began with a Charlotte Observer series charting problems with the company's aggressive sales tactics.
Beazer said Wednesday the internal investigation included "certain evidence that the Company's subsidiary, Beazer Mortgage Corporation, violated U.S. Department of Housing and Urban Development ("HUD") regulations and may have violated certain other laws and regulations in connection with certain of its mortgage origination activities." It did not give details.
The company's stock price declined in late trading, continuing a pattern in which Beazer's stock has dropped sharply in the hours before the announcement of bad news. The closing price of $10.48 was the lowest since 2000.
http://www.charlotte.com/business/story/238206.html |