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Arbor Realty – Letter to E&Y dated July 11, 2024

July 11, 2024 – Below is Viceroy’s third letter to Arbor’s auditor Ernst & Young regarding their ongoing lack of concern around Arbor’s financials. In particular:

  • The continued decline in the performance of their CLO loans, which closely mirror those on Arbor’s balance sheet.
  • Arbor’s use of modifications and extentions of unrecoverable loans to hide delinquencies
  • The use of lender-favorable mezzanine financing to cosmetically rehabilitate their loans, effectively round-tripping.

It is our view that E&Y have consistently failed to act in their capacity as auditor to assure that Arbor’s financial statements are free of material mistatements.