Chris Roach will be stepping down as the CEO of the appraisal firm BBG and will be replaced by the firm’s CFO Bill Britain during a challenging period for the company.
Roach will continue to work at BBG as a senior advisor to BBG’s Board of Directors.
The move comes amid a series of leadership changes at the appraisal firm before and after Freddie Mac placed the company “under review” and stopped accepting loans using valuations or appraisals from BBG.
Jon DiPietra, a managing director of BBG’s office, was placed on Freddie Mac’s “restricted vendor list,” which is essentially Freddie Mac’s blacklist. DiPietra is no longer with BBG. It is unclear what led Freddie to put BBG under review or put DiPietra on the restricted vendor list.
Roach said his decision to change roles at BBG began earlier this year as part of a broader leadership transition. He said it was also driven by the expectation of “significant market activity” in the fourth quarter and into 2025.
“We believe we are best positioning BBG and our customers to leverage the coming opportunities and sustain both our recent growth and our anticipated future growth,” said Roach in a statement.
But the company acknowledged in a recent release that it has been “challenged” for several months because of Freddie Mac’s move to put BBG “under review.”
BBG launched an internal analysis and said it is “implementing several initiatives to elevate our compliance standards and practices.” BBG can still provide environmental and engineering assessment services to Freddie Mac, according to the firm.
As part of the larger leadership shakeup, the firm recently hired a new chief compliance officer. It also hired Marty Skolnik, the former chief appraiser and director of multi-family appraisals at Freddie Mac, to oversee the firm’s government-sponsored enterprises compliance.
BBG is known as one of the Big Five national commercial real estate services firms and has 4,500 active clients, according to its website. Roach started with a predecessor of BBG in 2002. He eventually led the BBG’s growth in the western region. He was named president of BBG in 2015 and became the CEO a year later.
Freddie Mac and Fannie Mae have launched a crackdown on brokers, title insurers and investors over inflated financials. Freddie and Fannie have discovered that some of the loans they have acquired from private lenders are fraudulent.
Investigations often led by the FHFA and the DOJ have led to a few guilty pleas from investors. The DOJ recently charged the owner of a Lakewood-New Jersey title insurance firm for his alleged role in a multi-million dollar mortgage fraud scheme.
Notably, Freddie Mac and Fannie Mae temporarily halted dealmaking with the commercial brokerage powerhouse Meridian Capital Group after allegations that some of its brokers had inflated financial information to obtain larger loans. Earlier this year, Meridian’s long-time CEO Ralph Herzka moved to senior chairman to focus on transaction growth and relationship expansion.
Read More:
https://therealdeal.com/new-york/2024/03/26/meridians-ralph-herzka-moves-roles-amid-troubles
https://therealdeal.com/new-york/2024/05/24/freddie-mac-places-appraiser-bbg-under-review