Former mortgage staff allege lenders stiffed them on paychecks


Sprinkled among the compensation complaints from LOs are other alleged violations. A former Wells Fargo mortgage loan processor, who sued the bank in a Pennsylvania federal court for FLSA violations, is also accusing the company of retaliation based on religious beliefs, related to the plaintiff’s hesitance to take a COVID-19 shot. 

CrossCountry Mortgage, which has been involved in several poaching accusation battles, is facing some of the most severe accusations among the crop of FLSA complaints. Paul Lundholm, a former CCM employee, sued his former employer in February for allegedly failing to pay him a minimum wage.

The lawsuit filed in an Ohio federal court claims the lender had a scheme in which it would have new hires agree to a sign-on bonus, known as an “unvested wage advance,” which workers had to pay back if they left the company for any reason within a two-year period. As the market slowed, the commission-based employees didn’t make money and CCM would then sue to get the sign-on bonus back, it said.

“In our view they were trying to shift all the risk of the turn of the market onto these individuals,” said attorney Brendan Sweeney of The Law Office of Christopher Q. Davis, PLLC in New York City, on behalf of Lundholm, previously told National Mortgage News.

The amount in question is $81,371.83, according to the lawsuit. Three additional former CrossCountry employees have filed FLSA suits against the firm, while CCM itself has countersued Lundholm in federal court. CrossCountry’s attempts to recoup sign-on bonuses extends to an Ohio state court, where it’s sued over three dozen former employees for the five- and six-figure sign-on sums, earning default judgments against former loan officers in some of the cases.

CrossCountry’s attorney didn’t respond to repeated requests for comment, while the firm cited its policy of not commenting on litigation. Attorneys for Lundholm declined to comment further, as they recently filed a motion challenging CrossCountry’s move to compel arbitration. 

“CrossCountry easily could have guaranteed them at least a minimum wage payment in the weeks that they weren’t closing loans,” said aid attorney Anthony Lazzaro of Moreland HIlls, Ohio-based The Lazzaro Law Firm, LLC, on behalf of Lundholm. “The law is not hard to comply with but they definitely were not complying with the law in this case.”

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