The Securities and Exchange Commission (SEC) has sided with the Laborers' International Union of North America (LIUNA) in forcing Beazer Homes to disclose more information about its mortgage investments. LIUNA had sought a shareholder resolution on Beazer's proxy that would require the disclosure.
LIUNA filed more than 25 similar proposals with the SEC in response to challenges currently facing the mortgage and home building industries. According to the union, its half-million members are affected as workers, homeowners, and pension-fund holders.
"As many as 1 million residential construction workers will lose their jobs; as many as 3 million homeowners face foreclosure; and hundreds of billions of dollars in shareholder value have been lost," said LIUNA general president Terence M. O'Sullivan. "We submitted shareholder proposals in order to better understand the nature and depth of the crisis and to help the mortgage and housing industry correct its practices and avoid such problems in the future."
LIUNA is also using shareholder resolutions to seek mortgage practice disclosures from Lehman Brothers, the Ryland Group, Washington Mutual, Bear Stearns, Standard Pacific, and others.
In addition to fuller disclosure, LIUNA said in a statement that its actions seek to "limit conflict of interest between credit rating agencies and mortgage buyers and sellers who pay for those agencies services." It has also submitted proposals "that deal with the likelihood that numerous CEOs will be replaced due to the mortgage and housing market crisis."
Atlanta-based Beazer had asked for a "no action" letter from the SEC, but its request was denied. The builder did not return a call for comment.
This isn't the first time this year that shareholders have come after Beazer. On Nov. 6, the CtW Investment Group called for the immediate removal of CEO Ian J. McCarthy. In fact the builder has been mired in controversy, enduring federal, internal, and local investigations, top executive firings, default notices, and heavy losses.
More Beazer Homes USA news from BUILDER Online:
- Beazer Homes CEO: "We're Managing Through the Issues"
- Beazer Homes To Restate Prior Periods
- Beazer Homes Receives Sixth Default Notice
- Third-Quarter Losses Add to Beazer Homes' Woes
- Beazer Homes Fires Its Chief Accounting Officer
- Beazer Homes Downgraded by Moody's Investor Service
- Beazer Homes Stock Plummets as Rumors Swirl
- Beazer Homes Responds to Investigation