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Arbor – Fraud

May 9, 2024 – Viceroy Research today bestows the F-word upon Arbor and its management team: “fraud”. Viceroy’s investigations have discovered an elaborate and intentional con, where Arbor has financed purchases of assets from its own foreclosures, with Arbor loans, via off-balance sheet entities run by former Arbor associates, and entirely financed with Arbor equity capital.

  • Arbor financed 99% of the “non-controlling interest” equity of an off-balance sheet entity run by a former VP of Arbor, whose investment in the entity was also financed by Arbor. They share an office.
  • The purchase of the foreclosed properties is financed by an Arbor bridge loan, supplementary to the off-balance sheet entity’s deposit, also financed by Arbor. Arbor does not disclose related party transactions of this nature (the related party being itself).
  • Arbor has fraudulently overstated the value of its loan book through undisclosed, off-balance sheet, related party transactions.
  • Approximately half of Arbor’s Q1 2024 loan originations were to these off-balance sheet entities, to buy foreclosed properties.

This report will also provide a review of Arbor’s Q1 2024 10-Q, and statements made by management in their earnings call. Viceroy note the we have attempted to clarify numerous specific, poignant questions directly with Arbor management. Instead of answering any of our questions: management attempted to front-run this report with a press release asking investors to avoid our work.