United Wholesale Mortgage (UWM) (NYSE:UWMC) has pushed back on an attack against its operations by a hedge fund-backed Internet page that coincided with a lawsuit against the company and the hedge fund’s shorting of its stock.
The lawsuit was filed last week by four homebuyers in Florida, North Carolina and Tennessee who claimed UWM operated a “steering enterprise” with “captive” brokers that ran afoul of federal racketeering laws and other provisions. The lawsuit did not include brokers as defendants. Hunterbrook Capital, which published a lengthy article bashing UWM on its new “Hunterbrook Media” website, coordinated with the law firm representing the homebuyers while simultaneously shorting UWM stock and going long on its rival Rocket Companies.
In an unattributed statement published by UWM, the company denounced the attack as a “ridiculous article” with “obvious connections to Rocket Mortgage.” In its statement, UWM said, “The author, pretending to be a ‘journalist,’ worked at a Rocket Mortgage affiliated broker for the last 5 years, was actively working on this ‘report’ while employed there, left 2 months ago to work for Hunterbrook and this just happened to be Hunterbrook’s first scheme.”
Hunterbrook Media has not published any additional articles since its piece on UWM appeared last week. That article’s byline was attributed to four people; UWM did not identity which of the four was “pretending to be a ‘journalist.'”
“If any of our Partners get roped into this frivolous lawsuit, UWM will cover your attorneys’ fees in connection with these fraudulent claims,” the company added. “We have seen ‘ambulance chasing’ attorneys try to scare consumers and brokers. We will be there to defend you.”
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