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Metropolitan Mortgage

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.

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Summary

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