MELVILLE, N.Y. - The New York State Banking Department last week suspended the license of Island Mortgage Network Inc., a subsidiary of AppOnline.com, and will hold a hearing on Tuesday to consider revoking it completely.
In its June 30 notification, the department charged that Island Mortgage failed to meet its financial responsibilities and refused to allow state bank examiners access to its books and records.
The department charged that checks issued by Island Mortgage and its "settlement agents" to sellers of property and mortgagees were cancelled, though the company collected fees associated with the loans.
"We had received a number of complaints regarding Island Mortgage's settlement company that they had stopped payment of checks issued at closings that took place in several states in Island Mortgage's name," a department spokesman said. "We also received calls from regulatory agencies, attorneys, and clients."
According the department, Island Mortgage has collected fees on almost $150 million in loans that have yet to close.
Calls to AppOnline.com were not returned.