| Type | Privately Owned company |
|---|---|
| Industry | Finance and Mortgage |
| Founded | 1982 |
| Headquarters | Ocala, Florida |
| Key people | Lee Farkas, Chairman Paul Allen, CEO Ray Bowman, President, Stuart Scott, COO |
| Products | Mortgages |
| Employees | -- |
| Website | Taylor, Bean & Whitaker |
Taylor, Bean & Whitaker was a top 10 wholesale mortgage lending firm. Taylor, Bean & Whitaker closed $35 billion in residential mortgage loans in 2007. It employed about 2,000 workers and was the fifth largest issuer of GNMA securities.[1] On August 3, 2009, FBI Agents raided the company's headquarters in Ocala, Florida in connection with an investigation related to the company's acquisition of a majority stake in Colonial BancGroup. Taylor Bean & Whitaker had signed a deal on March 31, 2009 to become the majority owner of Colonial BancGroup in a $300 million equity stake. The next day, the Federal Housing Administration suspended the company from issuing FHA mortgage loans and Ginnie Mae mortgage backed securities.[2][3]On August 14, 2009, Taylor Bean & Whitaker ceased business operations and terminated all employees at its headquarters.[4]
On April 19, 2011, a federal jury in Alexandria, Virginia convicted Farkas, the majority owner of the company, of 14 counts of fraud. According to the government case, the fraud began in 2002 when Taylor overdrew its account with Colonial BancGroup by several million dollars. Taylor Bean then promised to cover the amount by the end of the day in a process known as sweeping. When the overdrafts grew to over $100 million midlevel Taylor Bean executives sold Colonial BancGroup $1 billion in mortgages that it did not own. Taylor Bean also operated a subsidiary, Ocala Funding, which sold $1.5 billion of worthless commercial paper to several banks including Deutsche Bank and BNP Paribas. [5]
During his sentencing hearing on June 30, 2011, Farkas read a statement saying that he "strived to be a good person." However, Federal District Judge Leonie Brinkema replied that she did not observe any genuine remorse and sentenced Farkas to 30 years in federal prison.[6] Farkas is currently serving his sentence at the Federal Correctional Institution, Williamsburg, a facility in South Carolina that holds minimum and medium security inmates, and is scheduled for release in 2037.[7]