In a follow up story on Diamond Resorts International, the Southern Investigative Reporting Foundation examines the relationship of Diamond Resorts International, a vacation ownership interest business, and Quorum Federal Credit Union (Purchase, NY).
The investigative report notes that Quorum Federal Credit Union has become a major lender to Diamond Resorts International. Quorum is also financing other vacation ownership interest companies.
Diamond Resorts International has entered into a $100 million loan facility agreement with Quorum FCU through the end of 2017. At the end of 2015, Diamond Resorts International represents 27 percent of Quorum's vacation ownership loans.
A former Quorum official told Southern Investigative Reporting Foundation that Diamond seemed to send its riskier loans to the credit union. Many of the loans went to applicants with credit scores below 660.
The article further points out that Quorum partnered with Diamond and other vacation ownership interest businesses to grow its membership.
According to the report, an association was used to qualify people for membership, who were seeking a timeshare loan from Quorum. When Quorum approved the loan, Diamond Resorts International purportedly deposited $25 in the borrowers savings account.
In addition, the report examines the relationship of Quorum with its credit union service organization, Vacation Ownership Funding Corporation, Inc. (VOFCO). Quorum owns 79 percent of VOFCO.
The article cites Quorum's 2015 annual report that the National Credit Union Administration is scrutinizing Quorum's Vacation Ownership Loan Program and may require Quorum to divest a large portion of its timeshare loans.
Read the report.
"Quorum's 2015 annual report that the National Credit Union Administration is scrutinizing Quorum's Vacation Ownership Loan Program and may require Quorum to divest a large portion of its timeshare loans."
ReplyDeletelet me get this straight.
in these 2 posts, you are describing a loan portfolio that contains medallion loans and timeshare vacation loans at about 3x the equity of the credit union.
where is the regulator?
and then the regulator comes in and says "sell"?
no wonder matz is retiring.
the last chairman that retired and said "all's good" was joanne (legacy asset) Johnson.
hmmm