Former executives of Taylor Bean & Whitaker Mortgage Corp. are accused of improperly taking more than $50 million from the failed company.
That allegation was made in a complaint for declaratory judgment filed Friday on behalf of Lloyd’s London in U.S. Bankruptcy Court for the Middle District of Florida. Named as defendants are Taylor Bean, Freddie Mac, Ginnie Mae and Sovereign Bank.
The Ocala, Fla.-based company lost its Federal Housing Administration approval in August 2009. At the time, it was the third largest FHA direct endorsement lender. Within a few days, new business was suspended and 964 employees were given notice.
Taylor Bean filed for relief under Chapter 11 of the U.S. Bankruptcy Code later that month.
Lee Farkas, the former chairman of the defunct lender, “withdrew substantial sums of money from Taylor Bean &Â Whitaker for his personal benefit or for the benefit of business ventures that he owns and controls,” the filing says.
An initial estimate puts the illegal withdrawals at more than $50 million, though the amount is still being analyzed.
In addition, former treasurer Desiree Brown received more than $1.5 million, include $0.7 million just over a week before Taylor Bean ceased operations.
Former chief financial officer Delton De’Armas, along with at least one consulting firm he owned, collected $275,000 in fees for successfully completing the company’s 2008 audited financials.
Lloyds deemed the payments received by both Brown and De’Armas as “improper personal financial gain.”
In Re:Â Taylor Bean & Whitaker Mortgage Corporation.
Case No. 3:09-bk-07047, August 2009 (U.S. Bankruptcy Court for the Middle District of Florida).
