SEC Eyes Carrington Mortgage Deal

Jun 18 2014 | 3:03pm ET

Hedge fund Carrington Holding’s move into mortgage-servicing is getting some unwanted attention seven years after the deal.

The Securities and Exchange Commission is investigating Carrington’s 2007 purchase of New Century Financial’s mortgage-servicing business following the subprime lender’s collapse. The regulator began subpoenaing documents from Carrington in the fall, The New York Times reports.

In particular, the SEC wants to know about how Greenwich, Conn-based Carrington financed the $188 million deal, as well as about the servicing business itself. Carrington used preferred equity securities to refinance part of the purchase, last year replacing them with $530 million in unsecured Irish Stock Exchange-listed securities that come due in 2021.

Carrington disclosed the probe to investors in November, but it has not previously been publicly reported.


In Depth

Royalties: The Alternative Assets of the Music Industry

Jul 8 2016 | 7:01pm ET

Recent market volatility has investors seeking greater insight into alternative...

Lifestyle

Vortic: Making Great American Watches Again

Jul 25 2016 | 6:29pm ET

If you are compelled by stories of entrepreneurial vision & drive, or simply...

Guest Contributor

MPI: Like Stellar Returns? Better Understand the Risks First

Jul 22 2016 | 8:44pm ET

When the press reports extraordinarily strong relative or risk-adjusted returns...