A retail lender is accusing United Wholesale Mortgage of stealing its business by funding loans originated by employees involved in a wider poaching scheme with another brokerage.

OneTrust Home Loans filed its theft of trade secrets complaint against E Mortgage Capital, UWM and 31 individual defendants last week in an Arizona federal court. The lawsuit claims OneTrust employees used an unauthorized mortgage platform to divert over $31 million in production to their future employer, EMC. 

UWM funded the loans, despite knowing or being "willfully blind" to the fact that the loans came from retail originators, the suit claims. Loan officers allegedly used the unauthorized Floify platform in early 2024 to divert the loans, and OneTrust said it did not discover the subterfuge until this past May. 

The companies have not formally responded to the complaint, but in statements this week denied wrongdoing. A spokesperson for UWM described the accusations as without merit. 

EMC, a larger Southern California-based brokerage with close to 1,000 sponsored originators, distanced itself from the claims. While the company confirmed the defendants had joined their firm, it said it was not aware of any alleged conduct that occurred prior to their switch. 

"E Mortgage Capital maintains a clear and firm policy: individuals who join our company are not permitted to bring leads, borrower information, or any loan opportunities that belong to a former employer," the company said in a statement. "That policy is non-negotiable and is something we enforce without exception."

OneTrust, which has also been on the opposite side of a poaching suit, did not return requests for comment. 

The scheme

The plaintiff firm said it discovered the alleged theft as it was reviewing documents from an arbitration dispute with the same former employees. The emails and team communications revealed the diversion, as OneTrust believes its employees downloaded loan pipelines, pricing policies, and other sensitive information. 

While OneTrust used the Blend point-of-sale software, the defendants allegedly signed up for the competing Floify platform to route borrowers toward EMC. To divert loans, defendants used their secondary email addresses named for the local lending team, although OneTrust said it operated that domain as well.

Their employer had suspicions that loans were being diverted, but could not determine the scope as it did not have access to Floify, the complaint said. The employees began to depart to EMC in February 2024. 

OneTrust argues that UWM should have known the loans that it processed from EMC came from the retail lender, because of internal communications and notes indicating their origin. The wholesale giant has no relationship with OneTrust, the lawsuit emphasized. 

Next steps

The complaint describes for each defendant how many borrowers, and how much in loan volume, they diverted. While some LOs diverted a single borrower for a smaller loan, others allegedly diverted up to 8 borrowers, and produced up to $3.8 million in origination volume for EMC. Other defendants are described as production assistants and others who facilitated onboarding. 

In addition to restitution, the lender is asking the court for injunctive relief to prevent the defendants from further using the stolen information. 

Like many other industry players, the lenders have been involved in prior poaching cases. OneTrust in 2024 agreed with Newrez to dismiss claims and counterclaims stemming from a retail leader's departure from Newrez to OneTrust. UWM filed its own theft of trade secrets case against local rival Towne Mortgage last year in a state court case which remains pending. 

EMC meanwhile has been targeted by several consumers in Telephone Consumer Protection Act complaints, and a federal judge granted conditional approval to certify a class of plaintiffs in one of those cases in February.