Thursday, July 1, 2010

The largest TARP fraud case to date - - this record sure to be topped

Lee Farkas, the former chairman of Taylor, Bean & Whitaker Mortgage Corp., was accused by DoJ of helping run a more than $1.9 billion fraud scheme that unsuccessfully attempted to steal money from the government’s Troubled Asset Relief Program.

The DoJ alleges that Taylor, Bean & Whitaker Mortgage Corp. lied about the health of loans it was servicing for the Federal Housing Administration. The DoJ also alleges that Farkas wrongly attempted to obtain more than $550 million from the government’s bank-bailout fund, making this the largest TARP fraud case to date. The DoJ further alleges that Farkas sought to deceive financial firms and TARP by covering up shortfalls at his closely held mortgage lending company in Florida.

Assistant Attorney General Lanny Breuer had this to say: “The fraud alleged here was truly stunning in its scale and complexity.”

Here is the DoJ press release:

DoJ Press Release (Farkas Indicted)

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