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Regulators Fine Mortgage Co., Including Stakeholder Peter Lynch
October 10, 2008
New Hampshire regulators have fined a now-defunct mortgage company, First Call Mortage, in which Peter Lynch of Fidelity fame had a 13% stake, The Wall Street Journal reports. As such, Lynch faces an $85,000 fine, and First Call, $767,500.
In addition, the regulator is seeking a fine from another Fidelity portfolio manager, George Vanderheiden, who held a 25% stake in the company.
Regulators say the firm overstated borrowers’ incomes, sold reverse mortgages improperly and didn’t safeguard confidential information.
Lynch and Vanderheiden issued a joint statement calling their holdings in First Call “passive” and emphasizing they were not involved in the management of the company.
Separately, Fidelity said that while the two executives still offer consulting to the firm, their investments are apart from management of the fund company.
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