Arbor Realty Shareholder Blames Leaders for High-Risk Lending

Arbor Realty Trust Inc. directors and executives breached their fiduciary duties by causing the real estate lender to deviate from its underwriting standards and by failing to disclose the resulting unsound loans, an investor alleges.

The members of leadership “were participating in a fraudulent scheme to artificially inflate Arbor’s loan volume and reported earnings by abandoning or, at minimum, recklessly disregarding, the Company’s underwriting standards to complete high-risk bridge loans,” Kay Lanba says on behalf of the company. She filed her shareholder derivative suit Wednesday in the US District Court for the District of Maryland, alleging wrongdoing dating back to ...