Topics

Metropolitan Mortgage

Summary

The single iconic image of the collapse of Metropolitan Mortgage was the company’s large white rectangular building on the Spokane skyline. It’s now the Wells Fargo building.

The $2.3 billion collapse of the homegrown Spokane financial conglomerate ranks as the largest business failure in Spokane history.

The bankruptcy begun in February 2004 was marred from the outset by an accounting scandal, a major investigation by the U.S. Securities & Exchange Commission, an FBI inquiry that resulted in the conviction of a senior Metropolitan executive, receivership actions by insurance regulators in three states, numerous lawsuits including an investor class action, arbitration cases and a tangle of claims and insider business dealings.

The millions of dollars spent on high-stakes litigation and experts attempting to unravel Metropolitan’s flawed transactions and financial records unfolded against this backdrop: Most of Metropolitan’s 16,000 investors were older residents living across the Northwest. Many had invested their life’s savings in a company that once claimed its unsecured corporate bonds were as safe as certified deposits from banks.

Summary written by staff writer John Stucke

Key people

  • Maggie Lyons

    Maggie Lyons was appointed by a federal judge to be the administrator of the Metropolitan Creditors Trust during the bankruptcy and after the expulsion of the company’s executives. An accountant and manager, she continues to discover, orchestrate and pursue the financial recoveries for the bondholders and other creditors.

  • C. Paul Sandifur Jr.

    C. Paul Sandifur Jr. is the son of the company’s founder. A colorful and controversial figure in Spokane’s political and business community, investigators determined that his overbearing management style and penchant for questionable business dealings helped spur the company’s collapse. He was forced out of his family’s company, lost his personal fortune, was forced to pay hundreds of thousands of dollars in fines. He was never charged with crimes.

  • Thomas Turner

    Tom Turner worked as a top executive for the Metropolitan family of companies. He was convicted of federal crimes for his role in perpetrating an accounting fraud that deceived auditors and investors.

Latest updates in this topic


  • Even Met disbursements are controversial

    Richard Ziehnert hurried to the trash can and started digging. At last he retrieved an unopened, nondescript envelope from Wells Fargo. Inside was a check for $263. It wasn’t so …


  • Met Mortgage starts mailing out $38 million payback

    At last. After 31 months, 12,500 court filings and a full-scale federal accounting fraud investigation, Metropolitan Mortgage & Securities Co. is mailing checks today to the thousands of people burned …


  • Payout planned for Met investors

    Investors in defunct Metropolitan Mortgage & Securities Inc. will receive a small payout within about two months. It’s been a 2½-year wait for thousands of people, who could only watch …


  • Met pursues Sandifur money

    Helen Sandifur, the ex-wife of former Metropolitan Mortgage & Securities Co. CEO C. Paul Sandifur Jr., is fighting allegations that $2.1 million paid to her by the company should be …


  • Met creditors closer to payouts

    Metropolitan Mortgage & Securities Co. and its insurance affiliate have resolved part of a bitter dispute that should finally allow the bankrupt firm to release money to thousands of creditors …


  • Met claimants to split insurance pool

    Metropolitan Mortgage & Securities Co. investors would split about $15 million under a settlement announced this week. The deal, just one small piece in the litigious web of Metropolitan’s bankruptcy, …


  • Met affiliate’s worth plunges

    The net worth of Metropolitan Mortgage & Securities Co.’s insurance affiliate has tumbled to $41.7 million as state insurance regulators continue to rework its financial holdings and strategy. Western United …


  • Met sues Sandifur family members

    Bankrupt Metropolitan Mortgage and Securities Co. has sued members of its founding family for millions of dollars, alleging that years of stock dividends, a divorce settlement funded at least in …


  • Judge approves Met bankruptcy plan

    A federal judge confirmed Metropolitan Mortgage & Securities Co.’s bankruptcy plan Thursday. The action begins a series of events that should return money to thousands of regional investors. Metropolitan trustee …


  • Former Met officer may deal

    Federal prosecutors and a former Metropolitan Mortgage & Securities Co. executive accused of deceiving auditors are negotiating a possible plea agreement. Such a development with Thomas Turner, who worked as …


  • Auditors of Met Mortgage lose bid

    A federal judge denied on Wednesday an effort by accounting firm PricewaterhouseCoopers LLP to escape blame in the failure of Metropolitan Mortgage & Securities Co. The Big Four accounting firm, …


  • Met creditors waiting for checks in mail

    Metropolitan Mortgage & Securities Co. creditors can expect a check early next year to help ease a bit of the sting out of Christmas shopping bills. Though their initial payout …


  • Auditing firm asks dismissal of Met suit

    An auditing firm that signed off on Metropolitan Mortgage & Securities Co.’s financial reports years ago was duped by dishonest executives and can’t be blamed for the Spokane company’s financial …


  • Affiliate seeks $220 million from Met

    An insurance affiliate of Metropolitan Mortgage & Securities Inc. has leveled a $220 million claim against the bankrupt firm, an action that threatens to delay and cut the cash recovery …


  • Sale of insurance affiliates may help some Met creditors recoup losses

    Insurance regulators in Idaho and Arizona struck an agreement to sell two insurance affiliates of bankrupt Metropolitan Mortgage & Securities Co., a deal that may return up to $20 million …


  • Met auditor wants protection

    An accounting firm caught up in the Metropolitan Mortgage & Securities Co. bankruptcy has asked a federal judge to dismiss claims that could cost it tens of millions of dollars. …


  • SEC charges whistleblower over Met transactions

    The U.S. Securities and Exchange Commission’s case against former Metropolitan Mortgage executives includes allegations against a whistleblower who’s now running a real estate development business in Spokane. Metropolitan executives recruited …


  • Deal would free millions in Met funds

    A proposed legal settlement involving former board members of a Metropolitan Mortgage affiliate would free millions of dollars to be returned to investors and release the directors from lawsuits and …


  • Sandifur’s lot

    EL CENTRO, Calif. – Less than a dozen miles from the Mexican border, C. Paul Sandifur Jr. is leading a new life. It’s here in a desert town in southernmost …


  • Ex-Met exec denies misleading auditors

    SEATTLE – Thomas Turner, formerly the No. 2 executive at the Metropolitan Mortgage & Securities group, pleaded not guilty Thursday to seven felony counts of misleading auditors. Turner appeared in …


  • Ex-Met executives accused of fraud in ‘our little Enron’

    Top executives of Metropolitan Mortgage & Securities Inc. were accused of fraud Monday, the first federal charges since the company went bankrupt. The actions allege former Metropolitan Chairman and CEO …


  • Met failure to end in pennies on dollar

    The Metropolitan Mortgage & Securities Co. bankruptcy could be wrapped up by Jan. 4, nearly two years after the Spokane company filed for protection from creditors. Metropolitan’s more than 16,000 …


  • Met Mortgage sues former accounting firm

    Current directors of Metropolitan Mortgage & Securities Co. have sued their former accounting firm, PriceWaterhouseCoopers LLC, alleging that negligent audits performed in 1999 and 2000 failed to warn them that …


  • Met insurance affiliate’s worth down sharply

    Metropolitan Mortgage & Securities’ large insurance affiliate is worth half what it was a year ago when state regulators seized control, a worrisome development as creditors await word on the …


  • Met Mortgage sells properties in Hawaii

    Metropolitan Mortgage & Securities Co. sold its idyllic Hawaiian properties and netted $16.7 million, a bit of bright news for creditors of the bankrupt company. Proceeds bested the company’s initial …


  • Brokers named in Met scandal

    A pair of Portland brokers have been targeted by a federal grand jury and ordered to cooperate in a separate U.S. Securities and Exchange Commission fraud investigation into Metropolitan Mortgage …


  • Met squabble could cut size of creditors’ payback

    Festering problems between bankrupt Metropolitan Mortgage & Securities and its valuable insurance affiliate threaten to cut the amount creditors could get back. “We have a bunch of investors over the …


  • Met insurance decision looms

    A decision on a the fate of three insurance affiliates of bankrupt Metropolitan Mortgage & Securities Co. might be weeks away, according to the Washington state Office of the Insurance …


  • Bids to buy insurance firms to be kept secret

    Bids to buy the three insurance affiliates of bankrupt Metropolitan Mortgage & Securities Inc. will be kept confidential until a purchaser is announced. The companies, including Spokane-based Western United Life …


  • Sandifurs may face Met lawsuit

    Metropolitan Mortgage & Securities Co. may sue former chairman and CEO C. Paul Sandifur Jr. and his ex-wife, Helen Sandifur, for millions of dollars, alleging that they profited even as …


  • Met to part with paradise

    Sun, surf, sand and serenity. These are qualities that could help creditors in the Metropolitan Mortgage & Securities bankruptcy get more money back from their failed investments.


  • Met files plan for liquidation

    The thousands of creditors holding notes from failed Metropolitan Mortgage & Securities should receive a small recovery beginning this fall, according to a reorganization plan filed in U.S. Bankruptcy Court. …

 

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