Monday, July 28, 2008
Coles's Death Ruled a Suicide
The medical examiner in Arizona's Maricopa County said Wednesday that Scott Coles, the late chief executive of real-estate lender Mortgages Ltd., died on June 2 as a result of suicide induced by alcohol, the painkiller oxycodone and zolpidem, a prescription medication used in sleeping pills.
The Wall Street Journal profiled Mr. Coles, who was 48 years old, and Mortgages Ltd. in a page-one article July 16. He had built the 45-year-old company, which was founded by his father, into one of Arizona's biggest private lenders to commercial real-estate developers, including those building some of Phoenix's highest-profile condominium and retail projects.
RELATED ARTICLE • Page One: Financier's Death Hints at Trouble for Lenders 07/16/08But Mr. Coles overreached, and his business was squeezed by the credit- and property-market crises. Borrowers couldn't repay loans and investors rushed to withdraw their money from Mortgages Ltd. After his death, Mortgages Ltd. entered Chapter 11 bankruptcy-court protection.
The situation has drawn attention to the condition of the nation's commercial real-estate market, which is beginning to show mounting signs of distress. Mortgages Ltd.'s troubles also shine a light on "hard money" lenders -- a high-risk, lightly regulated business that specializes in high-interest loans to developers who either have bad credit or a need for quick cash with a minimum of red tape.
Mortgages Ltd. is under scrutiny by state and federal agencies, which declined to comment on their inquiries. In the months before his death, Mr. Coles was beset by a string of lawsuits over Mortgages Ltd.'s business practices -- the company denies any wrongdoing -- and problems in his second marriage.
Write to Jonathan Karp at jonathan.karp@wsj.com
1 comment:
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