L.A. County senior citizens have come together against Renovate America and Renew Financial and have filed a class action lawsuit citing elder abuse. The company appears to prey on those who own their homes outright and have ample equity for the picking. Renovate America came on 2UrbanGirls radar when an Inglewood resident was featured in Wall Street Journal discussing the loan put on her home. It was equally shocking when 2UrbanGirls discovered a local councilman worked as a Program Manager, on behalf of Renovate America, in the South Bay area.
Related: America’s Fastest-Growing Loan Category Has Eerie Echoes of Subprime Crisis
The South Bay Cities Council of Governments (SBCCOG) is a joint power authority who is paid by the taxpayers in the 16 South Bay cities to promote energy-efficient programs to homeowners. One of their partners is Renovate America.
City of Long Beach Vice Mayor Rex Richardson was featured in a SBCCOG newsletter around April 2017 which listed him as Program Manager for Renovate America covering the South Bay area. 2UrbanGirls then reached out to Renovate America regarding his employment and his affirmative vote on a resolution authorizing Renovate America to pitch their loans to Long Beach residents.
On April 24, 2017, 2UrbanGirls was able to reach Matthew Bevans, a then Renovate America employee, who explained how Richardson came to work for them and how many jobs Renovate America created in the process.
In 2010, the City of Long Beach—along with most other cities in LA County—created the Los Angeles County Energy Program. In 2014, Renovate America answered an RFP to administer a residential PACE program in the County. We were one of two providers awarded the contract—the other is Renew Financial’s CalFirst Program. You can find those details here. That allowed us to operate in Long Beach. 87 out of 88 cities are now members: http://pace.lacounty.gov/property-eligibility.html
HERO and CalFirst took the extra step of also having the Long Beach City Council vote to officially join their programs on April 7, 2015. Another PACE provider called Figtree was also voted on by the City Council as part of the same vote. All were approved unanimously and all three motions were made by Councilmember Andrews, and seconded by Councilmember Uranga. All three votes happened back to back and are here.
Rex started with the HERO Program more than 6 months later on October 27, 2015. Rex doesn’t represent HERO in Long Beach, and doesn’t use his title of Long Beach City Councilmember when working on HERO issues outside of Long Beach. The one time that the subject of PACE has come before the Long Beach City Council since then, Rex recused himself. This happened sometime in 2016 when the City Council approved another PACE provider, Ygrene.
I hope this helps clear up any additional questions – please feel free to call me anytime at the number below. It’s my cell phone.
Best,
Matt
619.756.1626
HERO | Renovate America
On annual Statement of Economic Interest filings between 2015-2017 Richardson reported earning between $10k-$100k annually. When contacted about his working for a company, whose customers allege they are being pressured to sign up for loans they can’t afford and the company possibly defrauding investors, Richardson told 2UrbanGirls, “this is how I feed my family.”
As the news came out within the last two weeks that the class action lawsuit was filed by LA County homeowners, 2UrbanGirls asked Richardson via a Facebook post if he still worked for Renovate America, it was stated that he doesn’t.
In May 2017, Renovate America announced it was trimming jobs in their San Diego office and by November, the San Diego Tribune reported nearly 108 individuals lost their jobs. Presumably, Richardson was one of them. Why the abrupt “reorganization”?
In September 2017 it was revealed that Renovate America is the subject of both a FBI and SEC probe.
Related: FBI, SEC Look Into Business Practices of Country’s Largest ‘Green’ Lender
Renovate America spokesperson Ellen Qualls said the lenders haven’t pursued any action against customers.
“I think the most important thing for you to understand is that there have been no foreclosures initiated by any PACE provider in the United States since this started happening in Missouri, California and Florida,” said Qualls. (Missouri, California and Florida have been the three most active states with PACE loans.)
Related: Renovate America Masked Borrower Debt Woes
Well apparently there hasn’t been any foreclosures initiated because there are also allegations that Renovate America is defrauding investors, and possibly the SEC, by paying for homeowners loans for them to avoid going into foreclosure.
