twitter linkedin
facebook google+

Mortgage News

News by Subject
Complete list of specialty news sections.

Purchase Subscription
Subscribe to and get immediate access to all news, statistics and archives.

Mortgage Advertising
Reach mortgage executives, loan originators and other people tied to mortgage industry.

Consumer Mortgage News
Free mortgage news for prospective borrowers.

Mortgage Newsletter
Free e-mail newsletter with the latest headlines from

Mortgage News Reprints
Put entire stories in your online or printed newsletter or publication.

Mortgage Feedget RSS code
Condensed stories free on your Web site or for your RSS reader.

News Archives
Archive of stories by month going back to 1999.

Press Releases
Reports and announcements from

Mortgage Statistics
Data and statistics for real estate finance.

Mortgage Directories
Directories of lenders, branch operators and mortgage service providers.

Mortgage Graphs
Directories of lenders, branch operators and mortgage service providers.

home subscribe advertise reprints e-mail help RSS about us LOG IN

Mortgage News


Mortgage News

HOT Topics









site map

Mortgage Fraud News | Fraud Statistics | Fraud Index | Fraud Blog
Mortgage broker, originator and banker criminal cases. Real estate flipping and appraisal fraud. Mortgage fraud prevention, studies and analysis.

P R E S S   R E L E A S E


Jan. 28, 2013

Former Bank Vice President Sentenced to 10 Years in Prison for Mortgage Fraud Scheme
Loan Fraud Scheme Cripples Community Bank with More Than $10 Million in Losses

A former senior vice president and loan officer at Pierce Commercial Bank was sentenced today in U.S. District Court in Tacoma to 10 years in prison and five years of supervised release for a mortgage fraud scheme that resulted in the collapse of the bank, announced U.S. Attorney Jenny A. Durkan. Shawn L. Portmann pleaded guilty September 18, 2012, to conspiracy to make false statements in loan applications and to make false statements to the Department of Housing and Urban Development (HUD) and one count of making a false statement in loan applications. At sentencing, U.S. District Judge Benjamin H. Settle called it a fraud on multiple layers that "escaped detection because it involved people at every level participating in the fraud."

"Shawn Portmann's greed destroyed dreams, ruined careers, and defrauded millions from taxpayers," said U.S. Attorney Jenny A. Durkan. "He now will face the consequences of the damage he did to so many. The depth of his fraud helped bring down a bank and haunted innocent homeowners whose communities were degraded with vacant, foreclosed homes and a precipitous decline in property values."

According to the facts in the plea agreement, between 2004 and 2008, Portmann and other members of the conspiracy submitted false documents within various loan documents and applications. They falsified information about the borrowers' qualifications as well as their intention to reside in the homes being financed. A review of a sample of conventional and HUD loans showed that Portmann and his co-conspirators closed over 300 loans with false and fraudulent documents and information. More than half of this sample of loans have defaulted or otherwise caused loss, causing an estimated loss of more than $10 million to Pierce Commercial Bank, secondary investors, and HUD/FHA. Court records detail multiple false statements included in loan documents regarding an applicant's employment, income, and intention to reside in the property. Pierce Commercial Bank was closed by regulators in November 2010. Pierce Commercial Bank received $6.8 million from Troubled Asset Relief Program (TARP) in January 2009. This money was never repaid.

"Portmann's greed resulted in the loss of the entire $6.8 million in TARP funds invested in Pierce Commercial Bank, directly contributed to the bank's failure, and caused additional, significant financial losses for other TARP banks," said Christy Romero, Special Inspector General for TARP (SIGTARP). "Most important, the consequences of Portmann's mortgage fraud scheme will have a lasting impact on the community, which relies on local banks such as Pierce Commercial to serve as the mainstay for lending to its businesses and citizens. I want to praise the work of U.S. Attorney Jenny Durkan and our other law enforcement partners for their commitment to fighting fraud related to TARP."

"Although this sentencing does not erase the financial and emotional harm caused by Mr. Portmann to numerous victims—spanning homeowners harmed by the artificially inflated housing market to innocent bank employees who lost their jobs—I hope that they receive a measure of relief knowing that this unscrupulous predator is facing justice for his actions," said Laura M. Laughlin, Special Agent in Charge of the FBI Seattle Field Office. "The FBI and its partners remain committed to investigating criminal activity underlying the broader financial crisis. This case sends a message to all those who exploit others for personal gain: fraud in the mortgage industry is unacceptable and will not be tolerated."

"Mortgage fraud has done a lot of damage to our communities and to our individual concept of the American Dream," said Kenneth J. Hines, the Special Agent in Charge of IRS-Criminal Investigation in the Pacific Northwest. "This sentencing is a reminder of the serious consequences of mortgage fraud and of the relentless pursuit that the IRS and our law-enforcement partners are making to hold accountable people whose greed got the better of them."

"The sentence handed down today is proof positive to anyone who uses the U.S. mail to commit mortgage fraud: If you are a purveyor of fraudulent mortgage schemes and you use the U.S. mail, you will be caught and you will serve time in federal prison," said Bradley Kleinknecht, Inspector in Charge U.S. Postal Inspection Service.

Seven other defendants in this case have already been sentenced to prison terms for their roles in the fraud.

This case was brought as part of efforts underway by President Obama's Financial Fraud Enforcement Task Force (FFETF), which was created in November 2009 to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys' offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions, and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit

The case was investigated by the FBI, the HUD Office of Inspector General (HUD-OIG), Internal Revenue Service Office of Criminal Investigation (IRS-CI), the Washington State Department of Financial Institutions, and the United States Postal Inspection Service. The case was prosecuted by Assistant United States Attorneys Brian Werner and Arlen Storm.

Source: United States Attorney's Office for the Western District of Washington

mortgage fraud case stories

mortgage fraud headlines

mortgage fraud blog

Mortgage Daily headlines

Local Mortgage Fraud news
News about local mortgage fraud.

Logout forgot

Mortgage Fraud Statistics
Government and private data on volume of mortgage fraud activity.

Mortgage Fraud Index
Dollar and index amount by quarter and state.

Mortgage Fraud Litigation
Lawsuits and settlements invoving mortgage fraud by a lender insider. From 2007 through first-quarter 2013

Mortgage Fraud News
News stories about fraud committed against home lenders.

Mortgage Fraud Blog
Actions in mortgage fraud criminal and civil cases.

local mortgage fraud

mortgage fraud links

SUBSCRIBERS: Edit Subscription | Subscription Help | or call 214.521.1300

Subscribe Contact Us Site Map

Copyright © 2017 Mortgage Daily, D a l l a s
Subsribers Only:

AMC directory

ARM indexes

mortgage company directory

mortgage regulations

net branch directory

p r i c i n g engine directory

wholesale lender directory

More Mortgage News Resources (full site map):

advertising news

appraisal news

bank news

biggest lenders

commercial mortgage news

corporate mortgage news

credit news

FHA news

financial regulation news

foreclosure news

GSE news

jumbo mortgage news

interest rates

loan modification news

loan originator survey

LOS Newsletter


mortgage associations

mortgage-backed securities

mortgage books

mortgage brokers

mortgage compliance

mortgage conferences

mortgage directories

mortgage education

mortgage employment

mortgage employment index

mortgage executives

mortgage fraud

mortgage fraud blog

mortgage fraud local news

Mortgage Fraud Index

Mortgage Graveyard

mortgage insurance news

mortgage lawsuits

mortgage leads

mortgage lender ranking

mortgage licenses

mortgage litigation

Mortgage Litigation Index

Mortgage Market Index

mortgage mergers

mortgage news

mortgage politics

mortgage press releases

mortgage production

mortgage public relations

mortgage rates

mortgage servicing

mortgage statistics

mortgage technology

mortgage video

mortgage Webinars

net branch

net branch directory

nonprime news

origination news

originator tools

real estate news

refinance news

reverse mortgage news

secondary marketing

social media

servicing news

subprime news

wholesale lenders