CEO sentenced to three years for historic mortgage fraud scheme

New York /
Jun.June 22, 2011 02:01 PM

Paul Allen, CEO of Florida-based former mortgage lender Taylor Bean & Whitaker, once one of America’s largest lending firms, has been sentenced to over three years in prison after pleading guilty to one count of making false statements and one count of conspiring to commit bank and wire fraud, the Huffington Post reported. His actions, he admitted, were part of a $3 billion corporate fraud scheme, among the most significant in the history of the United States. Federal prosecutors had sought a six-year jail term.

“I messed up. I messed up big,” Allen told U.S. District Judge Leonie. “There was no excuse for my behavior.”

Taylor Bean went bust in 2009 when the criminal investigation became public. Its collapse resulted in the loss of 2,000 jobs and contributed to the collapse of Colonial Bank, which had bought hundreds of millions of dollars in Taylor Bean mortgages, already sold to other investors.

Allen’s lawyer urged for leniency, saying that Chairman Lee Farkas often excluded Allen from knowledge of operations. Farkas masterminded the scheme, he said.

“Mr. Allen was not treated as a CEO. He did not function as a CEO,” said defense lawyer Stephen Graeff. “Sentence Mr. Allen, the man, not Mr. Allen, the title.” [Huffington Post]


Related Articles

arrow_forward_ios
Matt Lauer exposes Hamptons estate to the market
Matt Lauer exposes Hamptons estate to the market
Matt Lauer exposes Hamptons estate to the market
 Fredrik Eklund and the property (Getty, Steve Frankel)
Fredrik Eklund lists Bel Air mansion for rent as family moves to “forever home”
Fredrik Eklund lists Bel Air mansion for rent as family moves to “forever home”
Gordon Ramsey and his Lucky Cat restaurant (Lucky Cat)
Gordon Ramsay to open first South Florida restaurant in Miami Beach
Gordon Ramsay to open first South Florida restaurant in Miami Beach
The former Presidio Public Health Hospital (Google)
At these Presidio apartments, you might room with a ghost for $3,700 a month
At these Presidio apartments, you might room with a ghost for $3,700 a month
The HSBC Tower (Google)
Andrew Chung’s Innovo Property Group grabs HSBC building in Bryant Park
Andrew Chung’s Innovo Property Group grabs HSBC building in Bryant Park
Marcelo Claure (Credit: Getty Images)
The $2 billion man? Marcelo Claure seeks top pay from SoftBank
The $2 billion man? Marcelo Claure seeks top pay from SoftBank
You’ll have to shell out another $15M for this private Bahamas island
You’ll have to shell out another $15M for this private Bahamas island
You’ll have to shell out another $15M for this private Bahamas island
(Nestron)
Singapore’s Nestron unveils its biggest — and priciest — tiny home
Singapore’s Nestron unveils its biggest — and priciest — tiny home
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...