Catherine Kissick, a well known figure in warehouse lending circles, late Friday pleaded guilty to criminal charges tied to the collapse of Taylor, Bean & Whitaker (TBW), a large Federal Housing Administration lender based in Ocala, Fla.

Kissick was a senior executive at Colonial Bancshares, Montgomery, TBW's largest warehouse provider. When the bank failed in August 2009 and was sold to BB&T, Kissick initially took a position with Colonial's new owner but was then placed on leave, sources told National Mortgage News.

Kissick, senior vice president in charge of warehouse lending at Colonial Bank, admitted to investigators that she conspired with former TBW chairman Lee Farkas in covering up TBW overdrafts and selling "fictitious" loans to the bank.

In total, Colonial Bank paid TBW more than $400 million for the worthless assets. TBW also failed that summer.

"Kissick or another co-conspirator at Colonial Bank were the points of contacts for conspirators at TBW when the mortgage bank needed an advance from the bank, and Kissick would generally discuss the new advances with Farkas before releasing the funds to TBW," according to the Department of Justice.

Kissick is scheduled for sentencing on June 17. She faces a maximum penalty of 30 years in prison.

Farkas was arrested last June and he goes on trial in April for his role in the scheme. Former TBW treasurer Desiree Brown pleaded guilty in February for her roll in the fraud.

In the Spring of 2009, Colonial, then the nation's largest warehouse provider, announced that it had received a $300 million capital commitment from TBW, a move that aided the bank's near-term survival.

TBW was the lead investor in a planned leveraged buyout of the bank, but Farkas could never raise the money. Colonial needed the initial $300 million to become eligible for $550 million of Federal Troubled Asset Relief Program funds.

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