Just hours or days before an expected Congressional vote in the House on their version of S. 2155, the Seattle Times is reporting on federal investigations into the business practices of Clayton Homes, Vanderbilt Mortgage, and their affiliated Berkshire Hathaway lending units.
“Gwen Schablik, a former Clayton employee who was featured in the 2015 article, said officials from HUD and the Department of Justice interviewed her about the issues last year,” per the Seattle Times’ Mike Baker. “Schablik has said that she and other staffers raised concerns with superiors about Spanish-speaking borrowers who had signed loan documents they couldn’t understand. She said managers told her there was no need to translate the documents.”
Baker’s narrative said Clayton issued a statement to them, emphasizing a claimed culture of compliance, “and does not tolerate discrimination of any kind in its interactions with customers.” But when the Daily Business News asked Clayton to denounce racism last year, they did not accept the opportunity to do so.
“We value working with federal and state agencies to improve processes and ensure all regulatory requirements are met and our customers are protected and treated fairly,” Clayton stated in writing, per the Seattle Times.
WBIR has a wrinkle in the report, shown below.
What It Means
The Seattle Times latest report confirmed several Daily Business News reports in 2017.
In that sense, Baker’s narrative is akin to the recent Washington Post report, which underscored facts reported by MHProNews, and/or by the Manufactured Housing for Regulatory Reform (MHARR).
The Post confirmed reports by MHProNews on issues related to
- Pamela Danner, the former administrator of the Office of Manufactured Housing Programs (OMHP),
- how the Manufactured Housing Institute (MHI) failed to ask HUD leadership to have Danner removed for numerous concerns over her allegedly problematic actions.
- MHI failed to act with respect to Danner, despite a widespread outcry against Danner’s repeated overreaches expressed by grass roots retailers, communities, producers, state associations, MHARR, and others.
- The overreaches were bad enough that HUD Secretary Ben Carson called them “ridiculous” in Senate testimony.
GuruFocus, Clayton’s Unethical Moats?
Days ago, “GuruFocus contributor John Engle asked the question: Are Warren Buffett’s Strategic ‘Moats’ Unethical?”
“This isn’t the first time Buffett’s love of moats has been attacked,” per GuruFocus. “Berkshire Hathaway has been criticized for its business practices, which seemed to put profit over customers, particularly at its Clayton Homes division.”
It is worth noting that GuruFocus’ Rupert Hargreaves used the proper industry terminology – “manufactured home” – while Seattle Times still uses the incorrect term, “mobile home.”
“Clayton Homes, for example, the largest builder of modular and manufactured homes in the United States, has been accused of relying on “predatory sales practices, exorbitant fees and interest rates that can exceed 15 percent, trapping many buyers in loans they can’t afford and in homes that are almost impossible to sell or refinance.” Evidently, if the company were looking to expand its moat naturally,” said Hargreaves for GuruFocus, “it would be trying to achieve the best reputation and results for customers rather than price gouging — a tactic only the largest [m]onopoly businesses tend to get away with.”
The Nation and others have also raised concerns about Clayton Homes, and their Buffett-led Berkshire Hathaway lending units.
Evidence of Monopoly?
To date, only MHProNews – thanks to a news tip from a reader – published 2 documents from 21st Mortgage Corp related to allegations of overtly monopolistic practices.
According to what attorneys have said to MHProNews who examined those 21st mortgage documents – and when compared to the facts in Buffett’s Berkshire annual letter that same year, along with the related videos – have led them to say that there is good evidence of monopolistic practices.
Is it just a question of time before word leaks out of anti-trust investigations of Buffett’s Berkshire manufactured housing industry brands? Will that include reported concerns over the trade association they dominate, the Manufactured Housing Institute (MHI) too?
The Daily Business News report, Smoking Gun 3, is linked below. “We Provide, You Decide.” ## (News, analysis, and commentary.)
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