S&L figure, trouble reunited

The state is investigating CFIC, the mortgage lender where Michael Wise now works.

Published May 12, 2007

Michael Wise may have left the savings and loan business - he was banned from banking for life - but controversy has followed him to the mortgage business.

The St. Petersburg-headquartered mortgage company where Wise landed has lost the right to do business in Georgia and is being investigated in Florida. One of its problems: Employment of felons, which some states don't allow.

Wise was chairman of Silverado Banking in Denver, which cost taxpayers $1-billion when it collapsed in 1988. He then went into the mortgage business, where he was accused of stealing $8.7-million from investors and was sentenced to three years in federal prison in Leavenworth, Kan.

After serving his sentence, Wise landed back in the mortgage business with Challenge Financial Investors Corp., which does business as CFIC Home Mortgage and claims to be one of the 10 largest mortgage lenders in the country. But CFIC has run into problems.

The Florida Department of Financial Services confirmed it is examining the company but would not provide details.

Georgia regulators revoked the company's license in March, without public explanation. The company paid a $193, 000 fine. The company confirmed the problem was employment of felons, which broke Georgia law. Its response was to fire employees with felony records who worked in some other states.

Tawana Sampson, a loan officer in Greensboro, N.C., was one of them. She said CFIC hired her knowing about her 1995 drug charge, then fired her last month citing a new company policy. She is upset that she was fired while Wise, who went to prison for a more serious crime, is running the company.

"I don't understand why I got fired with all the damage that Mr. Wise has done, " she said. "I haven't hurt anyone."

"We follow the state requirements and it depends on the position, " said Michael Riley, CFIC vice president. Wise wouldn't speak to the Times.

The man who hired Wise, Chris Likens, an owner of Nations Holding Co., CFIC's corporate parent, was not available Friday. But he told the Denver Post and the Times previously published that Wise is an employee of Nations, not CFIC, and that Wise's work at CFIC involves "marketing, getting additional branches and things of that nature."

Several former CFIC employees contacted the Times to dispute Likens' description, saying Wise has functioned as CFIC's chief executive and operating officer for several years.

"Mike Wise runs the company, period, " said Robert Brown, a former vice president. "You do not pay a bill. You do not do anything without Mike. If you stand up to him, you do not have a chance of staying there."

Public records show Wise's home in Belleair Bluffs was purchased for $950, 000 in his wife's name with CFIC mortgages for the full amount.

Some former employees are critical of the way the company does business. Jacob Carr, who said he managed information systems, claims the company makes many loans without proper licenses. He said the company had grown to about 500 offices but is now closer to 300 because so many people have left. Riley declined to discuss the licensing issue or how many offices the company has.

CFIC employees say Wise sent them an e-mail about the story the Times published about him earlier this week.

"I have made serious mistakes, the consequences of which will be with me for the rest of my life, and that is how it should be, " the e-mail said. "While I don't dwell on my past, it serves as a powerful motivator to make my future better. Five years ago, Chris Likens offered me an opportunity to do that, and for most of that time I have worked here at CFIC. It has been, and continues to be, a labor of love for me."

The authenticity of the e-mail could not be verified since Wise declined to answer questions from the Times.

Florida regulators say Wise is not listed as an officer of the company on documents filed with the state.

Helen Huntley can be reached at hhuntley@sptimes.com or (727) 893-8230.

Fast Facts:

CFIC Home Mortgage

Legal name: Challenge Financial Investors Corp.

Founder: Harold Barian

Headquarters: Downtown St. Petersburg

Offices: More than 300 across the country

Ownership: Nations Holding Co., Prairie Village, Kansas, since 2000