A mortgage fraud probe of Letitia James, a serious HR problem at the GSEs and the surprising site for Disney’s next theme park. From the wild and wooly world of real estate, here are our Hits and Misses for the week of May 5-9.
Hit: Karma Get It. When New York Attorney General Letitia James was prosecuting Donald Trump over alleged valuation fraud related to his real estate holdings, she declared, “No one is above the law.” Well, James’ words boomeranged back this week with a new criminal investigation by the FBI and the US Attorney’s Office in Albany into multiple allegations of mortgage fraud committed by James. While James is bellyaching this is nothing more than Trump’s “revenge tour” against her, that doesn’t explain the various falsehoods that she used in buying multiple properties over the years. Kudos to Bill Pulte, the director of the Federal Housing Finance Agency, who unearthed James’ shenanigans and made the initial criminal referral. And speaking of Pulte…
Miss: Some Unlikely Employees. In an interview this week, Pulte was asked about his efforts to fight fraud at the government-sponsored enterprises, and he casually acknowledged that Fannie Mae and Freddie Mac had some unusual people on their payrolls. “We recently criminally referred some North Koreans and Chinese for working inside Fannie Mae and Freddie Mac,” Pulte said. “I mean, what are the Chinese and the North Koreans doing in these companies?” Uh, what? How many of these people were working at Fannie and Freddie, and in what capacity? And what (if any) damage did these characters create? It would be appreciated if Pulte offered a little more details – this is much more than a mere human resources hiccup.
Hit: The Next Mouse House. The Walt Disney Company surprised many people this week by announcing plans for its first Middle East theme park destination at Abu Dhabi in the United Arab Emirates. Disney Abu Dhabi will be the company’s seventh theme park, but Disney has a great deal on this endeavor – it will be developed, funded and operated by Miral, the Abu Dhabi creator of immersive destinations and experiences. The announcement did not include a timeline on construction and completion, but this should be an exciting project for a company that has generated more misses than hits over the past several years.
Miss: Accusations Against the Appraisal Institute. The New York Times took aim at the Appraisal Institute with an article this week accusing Craig Steinley, a vice president for that trade organization, of multiple sexual harassment incidents over the past decade. The Times claimed 12 women were interviewed about their incidents with Steinley, but only Cindy Chance, who was fired as the Appraisal Institute’s chief executive last year, went on the record. However, the Times noted that while Chance was CEO she “approved the confidential six-figure settlement that was paid to another woman who had worked at the trade group and had filed sexual harassment claims against both Mr. Steinley and the organization” – but she wasn’t asked why she didn’t dismiss Steinley, who has denied the allegations. Clearly, the accusations are serious – but one has to wonder why they are being aired in the New York Times instead of the courts.
Miss: The Wrong Target. While the Trump administration has been mostly on target in aiming at wasteful programs and onerous regulations, it is making a mistake with its planned elimination of the Energy Star program that sets efficiency standards for appliances. The Washington Times reports the program is part of the Environmental Protection Agency’s organizational chart highlighting downsized endeavors. But this is a solution without a problem – the efficiency standards of the Energy Star appliances save consumers money on their utility bills while cutting carbon emissions. Yes, the Energy Star program provides tax credits and other incentives for the purchase of these rated appliances, but that is no one’s idea of a waste of money. Hopefully, the program will avoid the chopping block – and as any appliance owner will affirm, if it ain’t broke, don’t try to fix it.
Hit: Still Number One. For the 12th year in a row, real estate topped Gallup Poll’s survey of the most popular investment vehicles for Americans. In this year’s survey, 37% of respondents said real estate was the best investment, compared to 23% preferring gold, 16% choosing stocks, 13% citing savings accounts and/or certificates of deposit, 5% putting money in bonds, and 4% advocating cryptocurrency. This year’s survey was conducted April 1-14, right after the Trump tariffs were announced, and the results reaffirm that real estate is an investment that withstands the convulsions found in the financial markets.
Phil Hall is editor of Weekly Real Estate News. He can be reached at [email protected].
Photo: Sezeryadigar / Flickr Creative Commons
