Beazer – They’re Falling Like Dominoes

Beazer Update
It’s like the blind leading the deaf and dumb…

Beazer Exits Mortgage Business
February 1, 2008
Beazer Homes USA Inc. is getting out of the mortgage-origination business and has inked a marketing-services deal with Countrywide Financial Corp. that deemed the nation’s biggest mortgage lender the home builder’s preferred loan provider.

Beazer, which is in the process of restating previous results due to an internal probe of its lending and other practices, also released preliminary financial and operating data for its fiscal first quarter ended Dec. 31…

The company previously disclosed federal investigations into its mortgage-origination unit sparked by a series of articles the Charlotte Observer newspaper ran, alleging Beazer was arranging questionable loans for lower-income home buyers, which were resulting in high foreclosure rates…Its probe also uncovered evidence of other accounting irregularities that will lead to expected restatements. It has negotiated waivers of default from its lenders due to its failure to report financial results on time. Beazer on Friday said it expects to complete the restatements by May 15.
Beazer Homes Sues to Block $1.3 Billion Default Claim

“Beazer Homes USA Inc., the Atlanta- based builder that specializes in homes for first-time buyers, asked a federal court to block its bondholders from declaring the company in default on $1.3 billion in debt.

Beazer sued U.S. Bank N.A., the bondholders’ trustee, asking an Atlanta judge to prevent it from trying to accelerate debt repayment after the homebuilder announced this month that it had delayed filing a quarterly report with the U.S. Securities and Exchange Commission…”

See my previous post, Timely Reporting, Not Just A Job, It’s a Debenture

Who are the auditors? Deloitte, again

4 replies
  1. Just wondering!
    Just wondering! says:

    How is it that they can allow themselves to be 1.3 BILLION dollars in debt! Aren’t there boundaries, limitations????

    I admit, I don’t know much but it is so frustrating to see such mind boggling amounts thrown out like pennies!!!

  2. Ex Deloitte and PwC Consulting
    Ex Deloitte and PwC Consulting says:

    @1, it’s all relative isn’t it?

    I had a govt client when I worked at one of the two firms listed above. The job was to write a set of processes and tools which would hold govt expenditure accountable to stated objectives of the appropriation. It was a really satisfying job precisely because of that purpose. I was discussing with my client the difficulties in getting people to adopt the new tools, and hazarded that the dept. secretary could be enlisted to support the project publicly. “After all” I said “there’s a billion dollars a year getting spent here”. My client turned her world-weary eyes upon me. “That’s just the problem.” she said. “It’s only one billion.” We’re a forty-two billion dollar a year organisation.”

    At that point, how satisfying it would have been to get the chairman of BHP Billiton to materialise in the room, to explain just how hard this enormous organisation had to work to cause a billion dollars to appear in the world each year (roughly BHPB’s annual EBIT). My client had worked in this forty-two billion dollar a year organisation for too long, and had lost touch with how much a billion dollars was.

    And in a sense people who deal with these numbers have to forget what they mean. The alternative is to puff yourself up with the self importance sufficient to assume that you are worthy of that degree of trust. And go mad. Or to continually remind yourself just how critical every decision you make is, how much is riding on it. And go mad.

  3. @Deloitte
    @Deloitte says:

    This is obviously an old FM post that Justwondering seems to have revitalized – but since it is sort of relevant to the other port I just made I’ll comment here as well.

    Think of things in these terms:

    The Gov office of accounting or budget or IRs or whoever don’t know exactly how much revenue the US Gov brings in, where it all comes from, or where it all is or how it is all spent.

    * * * * * * * * *

    This reminds me of a friend who found out about a gov program, from his social worker, that he then figured out how to scam his way into, giving him a monthly check for the rest of his life, whether he ever worked again or not, plus retroactive payment of the funds he would have received had he gotten into this program from the date of when he had last worked (I’d like to point out that he had only held one job in his life – for a few months – right out of HS, and this took place well over ten years later). This same guy’s mom worked for the Gov in the same department and was concerned that she could lose her job is it got out that her child had found out and gotten into this program. She was quite a foolish woman as the Gov couldn’t figure out that he was even on the program if they had to let alone that his mother was a Gov employee. Besides, what she hadn’t thought about was that, as a civil servant, they couldn’t have fired her if they wanted to.

    Oh, and he parlayed that retroactive payment into a house, some lade in the blue ridge mountains, a farm in northern CA, and the house he now lives in Hawaii.

    * * * * * * * * *

    So my friend made out – easy laidback lifestyle with bare basic yearly income was the life he wanted, and got.

    I took a different road, admittedly not the partner track, but still in the complete op direction of my friend. Only I’m not screwing people out of money, I’m not shafting the tax payer because I know there’s some program that is gov supported that will give me millions, billions, etc

    * * * * * * * * *

    Yeah a billion is small change compared to 42, but so what – that doesn’t mean it isn’t a significant figure that needs to be addressed.

    This sort of stuff makes me stop and say “Who the f**k are these people and where the f**k did they spawn from?”

Trackbacks & Pingbacks

  1. […] day, the WSJ reported a new SEC action against the CEO of Beazer Homes.  You remember Beazer.  I have written about them. We haven’t seen any action on companies like Dell, yet, but I’ve been encouraging the […]

Comments are closed.