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December 13, 2019  

Two Founders of New Diligence Jump Ship

The leaders of mortgage-review firm New Diligence Advisors abruptly resigned this week.

While the plans of Mark Hughes and Ann Gibbons are unknown, sources suggest their exits were prompted by the Nov. 4 purchase of New Diligence’s owner, Selene Holdings, by mortgage-focused investment firm Pretium Partners. The belief is that Hughes and Gibbons disagreed with Pretium about New Diligence’s direction.

Industry participants expressed surprise that Hughes and Gibbons would leave, considering the effort they put into building the business. A few others appear to have followed them out of the operation. “They must have really not liked what Pretium has in mind,” one source said.

New Diligence works on behalf of bond underwriters, warehouse lenders and whole-loan buyers, offering a suite of due-diligence services including reviews of credit underwriting, property valuations, regulatory compliance, fraud detection, documentation, title verification and servicing.

Hughes conceived the idea for New Diligence after leaving his post as an executive vice president responsible for business development at Clayton Holdings in October 2016. In early 2017, former Selene head Lewis Ranieri supplied the operation with financial backing and office space. Gibbons, a former Clayton managing director, joined at the beginning of 2018.

New Diligence then quickly hired a staff of loan-review specialists. It also began appearing on rating agencies’ lists of accredited loan-review shops.

Hughes and Gibbons were seen as the public faces of the company, which ranked a layer below competing firms including American Mortgage Consultants, Clayton, Opus Capital Markets Consultants and Digital Risk in terms of business volume.

From Ranieri’s standpoint, the arrangement with New Diligence complemented Selene’s activities as a servicer. But Selene’s owners, Ranieri Partners and Oaktree Capital, agreed in October 2018 to sell that operation to Pretium amid a push by Ranieri Partners to focus more on its core businesses as a distressed real estate investor.

In November 2018, for example, Ranieri Partners agreed to sell mortgage company Shellpoint Partners to New Residential Investment. And in April 2018, it converted an asset-management arm called Ranieri Strategies to a family office.

Pretium, meanwhile, intends to continue running New Diligence without Hughes and Gibbons. The New York firm isn’t commenting on their exits.

Hughes held the titles of president, chief executive and chief operating officer at New Diligence. He started at Clayton in 2015 after stops at LenderLive and CoreLogic. Gibbons held the title of managing director at New Diligence. She had started at Clayton in 2003, after a stop at Murrayhill Co.