Metropolitan Mortgage

A judge's ruling Wednesday scuttled efforts by Metropolitan Mortgage to collect potentially damaging documents pointing to alleged malfeasance by its former auditor. The ruling is a small victory for that auditor, Ernst & Young LLP, which is fighting claims that it was negligent in an accounting fraud that ultimately sent Metropolitan into bankruptcy.

Workers have stripped the big green letters that once glowed "Metropolitan Financial Center" from the downtown Spokane highrise. At 17 floors, the white building beamed strength and prosperity.

Metropolitan Mortgage & Securities plans to sell its stake in GenPrime Inc. for $451,780 in cash to help settle its bankruptcy case. The sale is essentially a stock buyback for GenPrime, which will pay Metropolitan a fraction of the stock's original purchase price.

There was no lack of business news in the Inland Northwest this year, making it difficult to come up with a list of top stories. But some issues dominated our pages, either because of the number of people they affected, their economic impact, or because they signaled a change in an industry or in the community's direction. Here, then, are our picks for the top regional business stories of the year. Metropolitan Mortgage & Securities meltdown: Just days before the New Year this 50-year-old Spokane company suspended dividend and interest payments to its investors. Before January was out, Metropolitan Mortgage's independent auditor had quit, as had C. Paul Sandifur Jr., Met's president and CEO and son of its founder. Metropolitan Mortgage filed for Chapter 11 bankruptcy protection in February and its insurance affiliates were thrown into receivership. A special investigator was appointed by the Bankruptcy Court to dig into the company's finances. A grand jury was convened in Portland to probe for possible criminal wrongdoing. Meanwhile, Metropolitan began selling off its choice properties, including its eye-catching office tower in downtown Spokane, which went to Davenport Hotel owners Walt and Karen Worthy, its Metropolitan Performing Arts Theater, purchased by entrepreneurs Mitch and Cindy Silver, and its 77-acre parcel along the Spokane River just north of the downtown core, which was snapped up by North Idaho developer Marshall Chesrown. Legal fees are mounting in the tangle of lawsuits and bankruptcy court actions. And note-holders were told in August that they could receive as little as 10 cents on the dollar for their investments in Metropolitan and its sister company, Summit Securities.

One of downtown Spokane's tallest buildings will soon bear the name of a company that's growing in the region, rather than one that recently went bankrupt.

The federal bankruptcy court will auction off the 77-acre Summit property Wednesday in a transaction that could draw millions more for the Spokane River land than previously expected, benefiting creditors of Metropolitan Mortgage and Securities Co. In addition, Marshall Chesrown, developer of the exclusive Club at Black Rock, a 650-acre gated community and golf course on Lake Coeur d'Alene, has submitted a bid, said Metropolitan's attorney, Barry Davidson.

Fifteen brokers who sold Metropolitan Mortgage & Securities Inc. stocks and bonds have been accused of violating the Securities Act of Washington. The charges brought by the state Department of Financial Institutions are not criminal. They could lead to the revocation or suspension of brokers' licenses, censure, and fines ranging from $10,000 to $30,000.