A former executive of Colonial Bank in Montgomery, Ala., pleaded guilty to conspiring with officials at Taylor, Bean & Whitaker Mortgage Corp. to defraud investors and the government of about $970 million.
Catherine Kissick, 50, admitted to one count of conspiracy to commit wire, securities and bank fraud Wednesday in federal court in Alexandria, Va.
She agreed to cooperate with prosecutors bringing Lee Farkas, Taylor Bean's former chairman, to trial on April 4.
Kissick, a former Colonial Bank senior vice president and head of its mortgage warehouse lending division, admitted that from 2002 through August 2009 she conspired with Farkas and other Taylor Bean and Colonial Bank officials to transfer $400 million between the bank and the mortgage lender to hide Taylor Bean overdrafts.
U.S. District Judge Leonie Brinkema said she expects additional guilty pleas. "I think there will be other related cases we'll be sentencing as well," Brinkema said. Kissick is the second person to plead guilty in what prosecutors said was a scheme that targeted the government's Troubled Asset Relief Program and contributed to the bank's failure.
Kissick, of Orlando, Fla., faces a maximum sentence of 30 years in prison, a $250,000 fine and an order to pay restitution to more than 250 victims. She is to be sentenced June 17.
