TACOMA, Wash. — A former senior vice president at Pierce Commercial Bank has pleaded guilty in a $45 million mortgage fraud scheme that caused the bank's collapse.
The U.S. attorney's office says Shawn L. Portmann entered the plea Tuesday in U.S. District Court in Tacoma to charges of conspiracy and making false statements in loan applications. Prosecutors and defense attorneys agreed to recommend a prison term between 10 and 14 years.
Portmann was one of four people indicted in the case. Prosecutors said they falsified information about the borrowers' qualifications as well as their intention to reside in the homes being financed. Ultimately 270 fraudulent loans were issued, totaling $45 million.
More than 100 of the loans went into default.
Prosecutors say Pierce Commercial Bank received $6.8 million from the federal Troubled Asset Relief Program, or TARP, in January 2009. The money was never repaid.
Two other defendants have also pleaded guilty.