Taylor, Bean & Whitaker (TBW) was a top ten extensive mortgage loaning company in America. The Taylor, Bean & Whitaker Company closed over $35 billion in housing mortgage loans in 2007 and terminated its operations in 2009 following after being suspended by the Federal Housing Administration (FHA).
In 2002, Bowman discovered that the Taylor, Bean & Whitaker (TBW) was running overdrafts in the main bank account at Colonial Bank since it could not meet its operational expenses including payment servicing, payroll, mortgage securities, and other responsibilities. In 2003, Bowman, Farkas and other co-conspirators began sequence of duplicitous actions to hide these overdrafts by taking overnight cash from a TBW account and through fictitious mortgage loan sales to Colonial Bank. They referred to this strategy as "Plan B." In 2005, TBW put up a fully owned exceptional entity, the Ocala Funding LLC, which was used as a funding vehicle to offer extra mortgage funding. This facility was used to get mortgage lending funds by selling asset-supported commercial papers to financial organizations. In August of 2009, TBW ceased their operations and filed for Chapter 11 bankruptcy protection. Taylor deleted electronic communications from her BlackBerry and informed her staff members to do the same in order to avoid summonses from regulators and auditors.
The embezzlement was discovered through auditor controls and co-conspirators' confessions. For instance, Brown admitted that she and other co-conspirators got Colonial Bank to pay TBW for worthless properties and fabricated trades to Colonial Bank. Taylor herself pleaded guilty today for conspiring to commit bank. The Colonial BancGroup also presented additional financial data and files including false material information relating to securities assets and mortgage loans that were held by the Colonial Bank. TBW was unable to submit the necessary yearly fiscal report, thus Federal Housing Administration (FHA) interpreted that they had unresolved issues their independent auditor.
TBW Company attempted to salvage the situation, not by taking responsibility but by covering up. For instance, they instituted Ocala Funding LLC-a special functional entity to act as a financing means that would supply the bank with extra mortgage finances to assist the bank get back to its feet. Brown risked funding TBW through all means so as to aid in masking the massive expenses related to the servicing payments and operations owed to the third-party loans purchasers.
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First, the independent auditor of TWB discontinued the company's financial examination after realizing that there were some irregular business deals that aroused fears of supposed fraud. The auditors' role was tough considering that Taylor and her staff had deleted communication information from their BlackBerrys to hinder the auditor's investigations. The auditors' salaries were also blinding, ranging from 37k to 45k. However, the auditors along with a team of five others were later able to review and audit numerous loan submissions accounts from several mortgage brokers and banks through external and internal referral sources. The auditors made rigorous fraud investigations on loan mortgage brokers, borrowers, real-estate investors and real estate attorneys; and also provided loan files and investigations to the Postal Inspectors, FBI and the Police in reaction to summons concerning the legal proceedings of the mortgage fraud cases.
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