A couple months ago, I wrote a cover story in this publication about Jon Volpe, CEO of Nova Home Loans ("Like Trying to Catch a Cannonball," Feb. 5). It was an uplifting tale about a guy who went from being an abandoned teen, living in a garage with his stoner brother, to becoming a three-sport star and honors student in high school, leading the Pac-10 and then the Canadian Football League in rushing, and finally, after suffering a career-ending injury, returning home to become mega-successful in a field that not only made him a rich man, but also allowed him to help hundreds of families each year to buy a home.
The story of his success seemed almost too good to be true, and, judging by the wording and intensity of the responses I received after its publication, it's safe to say that Volpe isn't universally revered in his field. Terms like "self-promoter" and "bully" appeared in the correspondence I received, and more than a couple people I ran into at the gym and elsewhere had unflattering things to say about him. But successful people are going to have their detractors, no matter how nice or dedicated or professional they are in business and/or their personal lives.
But now comes word that Volpe has had a run-in with the feds over a bash he threw to thank some realtors with whom he has done business. At the banquet, Volpe presented certificates to the 10 realtors who had referred the most business to Nova. The certificates allowed those realtors who wished to do so to enter into a joint advertising arrangement with Volpe. The deal involved Volpe matching every advertising dollar that the realtors chose to put up.
The Department of Housing and Urban Development determined that such an arrangement amounted to an illegal kickback, a charge Volpe vehemently denies.
"It's really ridiculous," he asserts. "We offered to match them dollar for dollar, because the law says that a 50-50 split is legal. In fact, we were very careful to match every dollar so that we wouldn't violate any laws or rules."
Nevertheless, HUD found that the advertising match was in violation of a part of RESPA, the Real Estate Settlement Procedures Act. HUD also determined that the banquet itself constituted a RESPA violation since it wasn't open to every real estate agent in town.
After HUD made its findings, they notified Volpe and Nova, and that was that.
"They told us about it," says Volpe, "and we said that we wouldn't do it any more--even though we don't think we did anything wrong--and that was all there was to it. They didn't fine us or reprimand us."
HUD did go after the realtors who agreed to enter into the joint advertising agreement with Volpe's company. They want the realtors to return the matching funds and said realtors may yet be subject to a penalty or fine. Several calls to HUD in Washington, D.C., allowed me to talk to a wide variety of federal employees, none of whom had anything substantive to say. Most claimed they couldn't comment because the case was still open, even though Volpe was told more than a month ago that it was closed.
The Arizona Banking Department also got in on the action and fined Volpe's company an unspecified sum for handing out illegal gifts at the banquet. Those illegal gifts were gift certificates to Sullivan's Steak House, and violated the law because their face value exceeded the legal limit of $25. Oddly enough, it would be perfectly OK for Volpe to take all of the realtors in town out to dinner at Sullivan's and pick up the tab, but it's not OK for him to give them certificates so they can dine there on their own.
My first reaction is that there are people in this country illegally stealing airplanes and flying them into buildings, and our government is concerned about real estate advertising? But then, on second thought, I appreciate their efforts, because when the government doesn't stay vigilant and involved, you end up with things like, oh, a $50 per month cable bill.
Still, I can't help but be reminded of that scene in Beverly Hills Cop II in which Eddie Murphy is going to arrest Gilbert Gottfried for parking tickets. Gottfried says, "You're going to arrest me?! There are people out there with chainsaws, and you're arresting me?"
Jon Volpe isn't perfect. He's on the short side, and his hair is thinning. Heck, for all I know, he might even vote Republican. Still, his success may well be the result of his simply outworking everybody else. And if he is driven by demons, then, given his background, those demons are certainly understandable. All I know is that people whom I respect, respect him.
That's enough for me. For now.