FALLS CHURCH, Va. (AP) — A financial executive responsible for one of the largest frauds prosecuted out of the nation’s financial crisis a decade ago is being released from prison on compassionate grounds after serving just nine years of his 30-year sentence.
A judge on Tuesday ordered the release of Lee Farkas, 67, chairman of the now-defunct Florida-based mortgage company Taylor, Bean and Whitaker. Farkas sought release from prison because of concerns he was susceptible to the coronavirus while serving time at the Coleman low-security prison in Wildwood, Florida.
Farkas was majority owner of one of the nation’s largest mortgage companies when it engaged in a $3 billion fraud. His case was considered by many to be the most significant to be prosecuted stemming out of the mortgage, housing and financial scandals linked to the Great Recession.
The fraud led not only to the collapse of his company and the loss of 2,000 jobs, but also to the collapse of Alabama-based Colonial Bank, the sixth-largest bank failure in U.S. history at the time.
U.S. District Judge Leonie Brinkema in Alexandria, Virginia, cited Farkas’ age, health problems and an outbreak of coronavirus cases at the prison in ordering the release.
“Yes it was a large financial crime, but he was not the only person engaged in that type of crime,” she said. She also noted that the biggest victims in the fraud were other financial institutions, including Deutsche Bank.