Anatomy of a Substantiated (AMC) Complaint
Diligent Asset Valuations Alleged Multiple Non Payment to Appraisers
Anyone that knows me, or who has read past comments concerning California BREA’s non enforcement of C&R fees also knows I’m not generally their (BREA) biggest fan.
However, it would be intellectually dishonest not to recognize a case where they did the right thing. The case in question, BREA vs Diligent Asset Valuations (DAV), involved alleged multiple order non payment to appraisers by an AMC where orders were placed or assigned through the MERCURY NETWORK.
The specific logistics of how Mercury is involved could be of interest to those that use that service. I don’t, and cannot offer comment except to say it would be prudent to look into the matter. It’s nice that Mercury had records of multiple non payment complaints, but the question I have is WHY THEY ALLOWED DAV TO KEEP PLACING ORDERS THROUGH THEM AFTER THE FIRST UNRESOLVED COMPLAINT???
I tend to be unforgiving on issues of non payment. Either the money is owed or it is not, and it should not take more than a single phone call to resolve that. Whether there are mitigating circumstances (money is in the mail and got lost; stop payment and reissue all within two weeks could require more than one call). We all know the difference between a truly concerned AMC response and a run around. Perhaps MERCURY may wish to reconsider its user ordering agreements.
According to the complaint (and stipulation) DAV operated for years as an unlicensed AMC in several states.
Doesn’t MERCURY regularly check to see that the companies it allows to use their service comply with laws in the states that they are placing orders for? If AMCs can notify appraisers when their licenses or E&O is set to expire, portal networks should be able to accomplish the same thing for their lender and AMC users.
Again, some revision of their process seems to be in order. Perhaps a ‘member or authorized AMC’ section that has links to ALL the state licenses / registrations the AMC operates in along with their expiration dates. My understanding is ASC is either working on something along those lines or may already have it.
MERCURY was the online portal service involved in the instance being cited but it could just as easily have been another access and re-ordering appraisal management service (AMS) or portal service. ALL should learn form this incident and take the initiative to fix their systemic loopholes that appear to have allowed or facilitated an AMC without a license in multiple states to operate in their system. According to BREA, MERCURY knows it processed 63 orders from DAV after their California state registration had expired. How many from other states is not known.
Again, this is not an indictment of MERCURY. I am simply pointing out questions that arise from the BREA vs DAV complaint in question. I assume Mercury will take immediate steps to prevent these kind of problems in the future.
ALL appraisers should read the entire stipulation and complaint. Below is the PDF copy of the stipulation / Order only as it restates the complaint. Both the complaint and stipulation (Final Order) can be read on the BREA website. In California the BREA is found online under their old name – OREA.ca.gov.
As appraisers we may need to make suggestions for AMC or portal regulation to federal authorities so that a bad actor AMC in one state cannot simply drop that state from their coverage area and resume business in the other 49 states and 7 territories. Lenders that use the portal system(s) direct should also be included in any payment issue reporting section. Obviously they are exempt from AMC licensing, but identification as direct-client originators could be just as helpful.
I hope the blog readers will analyze the complaint/stipulation carefully in order to offer constructive suggestions. Let’s not merely bash all the AMC’s, portals or state regulators. Let’s try to develop practical methods of assuring payment, and broad public identification of those that do not pay promptly.
Anyone can have one or two payment issues, but when companies have multiple issues then that information should be made known.
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I don’t understand why Got Appraisals is allowed to continue to operate. They never pay appraisers unless threatened.
Pennsylvania has always had some pretty tough ‘theft of service’ laws. Don’t they cover something like this? Bottom line is that noting happens until someone files a formal complaint. Usually the reason companies like the one you cited remain in business until one or more people do something about it.
Appraisal Management Company Act:
The payment to appraisers is an afterthought, meaning after you call, they will give it thought after you hang up. I’ve been dealing with JP Morgan Chase and there flawed Suppler Management Portal (required for VA payments) for nearly two months on a three month old VA appraisal. They have no direct phone assistance, there help link is blank, and their take a screenshot and we will get back to you accounts payable help line (e-mail), is a joke. When the Mercury Network was sold/split off from A la Mode, the press release at the time indicated they handle 20,000 transactions A DAY. If they can pull in $10 to $15 a pop on 20,000 daily transactions, then any issues they have (fines for a few non-licensed transactions), will be offset by their profits. This is the game that is played.
For issues involving non payment by VA lenders I’d contact the VA Regional Loan Center direct. Jan Bellas has been very successful in obtaining past due VA payments for our members. email@example.com . I was told of one case where they no longer allow the AMC to pay after the fact. Like the old days that AMC has to pay in advance.
In the real world I haven chosen to never again do residential work for JP Morgan Chase, however as this was blindly assigned by the VA, my options were limited. At no time prior to taking the assignment, was it disclosed that I must also sign up with what they call their Supplier Management Portal, and agree to a short list of demands. The issue is their system has locked up my profile and is not allowing me to complete the application process. They technically have everything they need for payment (the appraisal, NOV from the VA, my EIN, etc.,) but after repeated attempts to send them screen shots of what I think the issue is, they have yet to resolved the issue (2 months). Without a profile, I can’t formally upload the invoice for payment. I will perhaps take your advice, your keep banging my head against the wall.
Call the VA Bill. If you are also an AGA member, call Jan. She’s great at this kind of stuff.
Unrelated to the above case payment issues, Jan Bellas made effective contact with a Chase VP in order to to have an appraiser removed from their ineligible list.
The Chase exec was extremely helpful and cooperative in resolving the issue. We look forward to working with him / them in resolving future issues.
Folks, often it is just being tenacious enough to reach the right decision makers.
“16.a. The director finds and declares as follows; That the profession of real estate appraisal is vested with a fiduciary relationship of trust and confidence as to clients, lending institutions, and both public and private guarantors or insurers of funds in federally related real estate transactions and that the qualifications of honesty, candor, integrity, and trustworthiness are directly and substantially related to and indispensable to the practice of the appraisal profession. (then same for amc) (then same, every holder of a license shall demonstrate these qualifications).
35! “I am sorry but I do not have any records of the other information. I had a computer crash and lost old information. I also had a computer stolen with my accounting records.”
Respondent krebs told the investigatory that he knows there are seven cases regarding non payment of the appraisal fees pending against him, and admitted that his records are ‘so bad’ that he does not know whom he did or did not pay.
Finally, a clear statement; 40. Respondents have failed to pay engaged appraisers an agreed upon fee after assignments were delivered on numerous occasions, and failed to maintain required records of all appraisal fees dispersed to contracted appraisers.
42. respondent krebs provided a dishonest response when he stated; “I received this latter and am writing to let you know, I am not the owner of this company and never have been. When I was involved with this company several years ago it was never an appraisal management company. I have never heard of this file of appraiser in this letter. As far as I know this company does not exist anymore and has never done work in Oregon.
Wow, pg 24 of pdf doc is where it gets good. Fourth cause for discipline; In that they repeatedly exhibited dishonest and untrustworthy conduct when they continuously failed to pay engaged appraisers for appraisal reports through; causing financial injury to the engaged appraisers as detailed. And again Fifth cause; in that they committed acts involving dishonestly, fraud and deceit by habitually and continually failing to pay for appraisal reports.
Well, that was a lot of build up for what equates to a nothing burger. The guy clearly should have paid and who ran the show when he was absent? Well, habitual dishonesty? If the appraisersforum can be used as evidence in court…… The class action database is at your disposal.
ANYONE INTERESTED IN BREA OREA NEEDS TO READ THIS