Synopsis
After Lee Farkas’s construction company failed, he decided that if he couldn’t get rich building houses, he would get rich financing them. Farkas purchased Taylor, Bean & Whitaker (TBW), a small mortgage lender, and increased its loan volume from 40 loan applications per month to 14,000 per month. When FBI agents raided TBW’s corporate headquarters in August 2009, they found evidence that the company had sold thousands of fictitious mortgages to the lenders who provided its financing. Farkas receive a 20-year prison sentence for his role in the fraud.
Discussion Questions
- What did TBW do with most of the loans it originated? What were TBW’s two primary sources of revenue?
- What actions did Lee Farkas and Catherine Kissick take to conceal TBW’s overdrafts at Colonial Bank?
- How was the TBW fraud discovered?
- On what grounds did plaintiffs seek damages from TBW’s auditor Deloitte & Touche?
- On what grounds did plaintiffs seek damages from Colonial Bank’s auditor PricewaterhouseCoopers?
Additional Sources
American Greed – Financial Home Invasion. The TV series American Greed examines the accounting fraud at Taylor, Bean & Whitaker (43:13 minutes).
Called to Account 