Mortgage vendor sues former exec for poaching lender purchasers

A mortgage vendor is suing considered one of its former executives for beginning a competing firm whereas employed and soliciting a few of its bigger-name clients.

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New Jersey-based tech-demos-from-digital-mortgage-2024-what-you-need-to-know#:~:textual content=competitivepercent20industrypercent20player.-,Flatworldpercent20Solutions,-Productpercent3Apercent20MSuite” class=”Hyperlink” goal=”_blank”>Flatworld Mortgage Options sued Rajeev Kumar final week in a federal courtroom, accusing its former govt vp of breaching numerous employment agreements. Kumar, who claims he was a co-founder of FMS, is the co-founder and CEO of OwnGCC, an outsourcing agency based earlier this 12 months. 

Flatworld gives quite a lot of mortgage processing companies for business companies together with lenders, title corporations and appraisers. OwnGCC, which isn’t named as a defendant within the grievance, says it helps corporations arrange and handle world functionality facilities, or offshore hubs for operations.

The lawsuit claims Kumar, who was employed at FMS between 2021 and 2025, breached his nonsolicitation settlement by advertising his new firm to Flatworld clients together with Angel Oak Mortgage, eLend, Mutual of Omaha and The Lender. None of these lenders are named as defendants within the lawsuit. 

Throughout his time at Flatworld, Kumar allegedly launched OwnGCC. Whereas employed he allegedly entered right into a secret facet take care of one other firm to assist it arrange a captive name middle, for Kumar’s profit. The lawsuit names the corporate as “NAF”, though it doesn’t state the corporate’s full identify. 

In line with a Could cease-and-desist letter filed by Flatworld’s attorneys, Kumar solicited the corporate’s workers to hitch his firm. He additionally allegedly shared Flatworld’s confidential enterprise data with a separate, non-mortgage enterprise. 

When contacted by Nationwide Mortgage Information Tuesday, Kumar mentioned he wasn’t conscious of the lawsuit. Neither the legal professional who filed the case, nor a consultant for Flatworld responded to requests for remark. The corporate is searching for an injunction to stop Kumar from soliciting extra of its clients.

Whereas lenders usually file related lawsuits against competitors and loan officers following unhealthy breakups, business distributors have more and more turn out to be litigious. A smaller vendor sued Pennymac earlier this 12 months for allegedly lifting its platform, whereas communication vendor tech-fight” class=”Hyperlink” goal=”_blank”>Ringcentral sued Amerisave Mortgage earlier this 12 months for nonpayment. Each of these instances stay pending.