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Collapsed lender First Magnus Financial Corp. paid illegal fees to real estate companies and builders to secure mortgage business, according to an audit report released by U.S. Department of Housing and Urban Development.

The Aug. 4 HUD Office of Inspector General report said that First Magnus paid the fees between 2003 and 2005 to builders T.J. Bednar and Santa Anna Homes as well as to Long Realty Co. and Realty Executives.

The fees and other agreements outlined in the report violated the Real Estate Settlement Procedures Act, according to HUD. RESPA, as the law is known, forbids mortgage lenders or other parties involved real estate transactions to give or receive “any fee, kickback or thing of value” in exchange for referring business.

In an e-mail forwarded by a public relations representative, Long Cos. CEO Rosey Koberlein said her company is “unaware of the substance of the allegations in the Inspector General’s audit report. "We have only recently obtained a copy of the report and are reviewing it.”

Realty Executives Southern Arizona CEO Anthony Azar did not return a call for comment. Calls to Tucson builder T.J. Bednar also were not returned.

Mason Cave, chief financial officer for Peoria-based Santa Anna Homes, said he could not find any evidence that referral fees or other incentives were paid by First Magnus to his company.