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A m e r i c a n P o s t – G a z e t t e
Distributed by C O M M O N S E N S E , in Arizona
Posted: Dec. 6th, 2012
In the spring of 2012, Attorney General Horne accepted a litigation settlement from the mortgage loan industry whereby the State of Arizona would receive approximately $107,000,000 for general purposes related to assisting State government and the State’s home mortgage borrowers with efforts to ease the impact on Arizona’s economy stemming from massive mortgage foreclosures.
From the very beginning, Tom Horne put Kathleen Winn, his co-conspirator/co-defendant Outreach Director, in operational control over this mortgage relief money. Winn proceeded to assemble AG staff to work with her on distributing this money. Winn conducted many meetings, both open and closed as she set the Attorney General’s agenda for the use of this mortgage relief money. Winn has been orchestrating a huge “quid pro quo” network of recipients of this settlement money for her personal gain as a licensed loan originator. In doing so, Winn did not give adequate consideration to the many stakeholders in this process such as the Dept. of Financial Institutions, Dept. of Real Estate, Dept. of Insurance, etc. Nor has Winn addressed her outrageous conflict of interest as she is currently licensed and actively doing private business as a loan originator.
The State Legislature stepped into the process and placed $50 million of the settlement money into the General Fund. In an AG staff briefing right afterwards, AG Division Chief Tom Chenal called that action by the Legislature his “$50 million haircut” and vowed to keep fighting for that money and “screw the Legislature.” Ditto for Horne’s lobbyist Art Harding, who went with Tom Chenal to meet with Legislative leaders. That action by the Legislature is now the subject of litigation brought by allies of Kathleen Winn (Hogan et al) who wanted the full $107 million to go toward social programs and public financial aid for foreclosed upon former homeowners, many of which pocketed excessive cash-outs from their home financing and re-financing.
At present, Winn and AG staff are planning to and hurrying to disburse the AG’s settlement monies to multiple social service agencies that Winn has personally selected. There has been no oversight whatsoever as to what Winn and the AG’s staff are is doing with the $57 million entrusted to them.
Kathleen A. Winn’s license number as a “loan originator” licensed by the Arizona Dept. of Financial Institutions is 0914754. Her license is jointly held with her sponsoring mortgage broker Amerifirst Financial, Inc., 1550 E. McKellips, Suite 117, Mesa, AZ 85203, tel. 480-344-1900. Winn is subject to and in total violation of the Attorney General’s Office’s standing guidelines and prohibitions for secondary (outside) employment. This grievous conflict situation is being allowed by Horne himself.
This entire arrangement by Horne and Winn is a scandal of unprecedented size in Arizona government. An immediate investigation by the Arizona Legislature and the Arizona Auditor General is highly warranted.