Commissioner Patrick M. McQueen of the Michigan Financial Institutions Bureau announced that Mortgage Sources, Inc. of Birmingham, Michigan, has agreed to unwind their business within 45 days as a result of administrative action taken by the Bureau.

Commissioner McQueen had issued an Order on August 3, 1998, denying Mortgage Sources application for licensure under the Mortgage Brokers, Lenders, and Servicers Licensing Act and revoking the company's Secondary Mortgage Act license. As a result, Mortgage Sources is without authority to conduct business under either act and has been ordered to cease operating in violation of the Mortgage Brokers, Lenders, and Servicers Licensing Act.

Mortgage Sources, owned by Mel Durbin, has paid $15,000 in civil penalties. Other principals, agents, and employees named in the Order include Michael E. Cauley, Renee Fortin, Anne E. Melone, and Ken Paskiewicz.

The license revocation resulted from an investigation conducted by the Financial Institutions Bureau. The FIB staff investigation led to charges that principals, agents, and employees of Mortgage Sources, Inc. engaged in fraud and misrepresentation by falsifying loan applicant's income and employment information in order to obtain loan approvals for borrowers. The Commissioner found that Mortgage Sources knowingly, or without the exercise of due care, violated the act.

The company has been granted 45 days to close the loans in process and liquidate its operation.

The Michigan Financial Institutions Bureau is the primary regulator of Michigan's state-chartered banks, credit unions, savings banks, and over 4000 other licensed lenders.