Posted on Thursday, March 17, 2011
Raymond E. Bowman, the former president of Taylor, Bean & Whitaker Mortgage, pleaded guilty on Monday in connection with a $1.9 billion fraud that included trying to deceive the federal bank bailout program.
Mr. Bowman, 45, of Atlanta, admitted to one count of conspiracy to commit wire fraud, bank fraud and securities fraud and one count of making false statements. Mr. Bowman also agreed to cooperate with prosecutors’ investigation of the company.
Federal prosecutors filed a criminal case against Mr. Bowman last week before United States District Judge Leonie Brinkema in Alexandria, Va. Judge Brinkema has presided over cases resulting from a scheme that the prosecutors said sought to defraud the government’s Troubled Asset Relief Program and contributed to the failure of Colonial Bank, based in Montgomery, Ala.
Mr. Bowman, who is expected to be sentenced on June 10, faces a maximum of five years in prison on each count, plus a fine of as much as $500,000 and full restitution to victims, according to prosecutors. Judge Brinkema asked prosecutors whether they would file a forfeiture case against Mr. Bowman.
“That remains to be seen,” said Charles Connolly, an assistant United States attorney. “The issue we’re exploring is whether the defendant derived any benefit from the fraud scheme.”
Two other Taylor Bean executives, including its former chairman, Lee B. Farkas, were charged previously in the scheme by covering up shortfalls at Taylor Bean. Mr. Farkas’s trial on 16 counts is set for April 4.
Taylor Bean was once the largest nondepository mortgage lender in the United States, the Securities and Exchange Commission said in a statement.
Desiree E. Brown, Taylor Bean’s former treasurer, and Catherine L. Kissick, a former Colonial Bank executive, have pleaded guilty to conspiracy to commit wire fraud, bank fraud and securities fraud and agreed to cooperate in the government’s prosecution of Mr. Farkas. Both also settled securities cases with the S.E.C.
Ms. Brown and Ms. Kissick each face 30 years in prison, a $250,000 fine and an order to pay restitution to more than 250 victims.
By BLOOMBERG NEWS