State takes over troubled mortgage firm

Wednesday, Nov. 3, 1999 | 11:31 a.m.

CARSON CITY -- The state Financial Institutions Division announced today it has taken possession of Interstate Mortgage Group Inc. in Las Vegas because of unsafe conditions growing out of the company's loss of collateral securing loans of $5.7 million.

The order directs David Ferradino, president of the company and some affiliated firms, to turn over the business to the state.

L. Scott Walshaw, commissioner of the state division, said he has named George C. Swarts, a certified public accountant in Las Vegas, to serve as conservator.

Ferradino could not be reached for comment this morning.

Walshaw said the first task of Swarts will be to issue reports to investors on the status of their investments.

Under state law, Walshaw said, the company has 60 days to remedy the unsafe conditions that prompted the takeover. If that is not successfully completed, Walshaw said he may then take steps and request the District Court to appoint a receiver.

Lyndon Evans, deputy commissioner, said Interstate Mortgage has been licensed since 1984. The division had conducted an examination of the books and then discovered the loss of the collateral during a follow-up. He said Ferradino voluntarily disclosed the loss.

Evans said Ferradino has been cooperative and did not pose any problems during the takeover.

Evans said the takeover was not a result of the new, tighter rules on mortgage lending passed by the 1999 Legislature but came about as a result of regular examinations and filing of investor complaints.