Corporate Fraud

Spokane, WA: (Oct-30-07) The US Securities and Exchange Commission (SEC) brought charges against C. Paul Sandifur Jr., the former leader of bankrupt Metropolitan Mortgage & Securities Co., alleging that he masterminded fraudulent real estate deals that backfired into an accounting scandal. Records state that the collapse of Metropolitan and its group of companies left thousands of investors holding $470 million in unsecured bonds; another $131 million in preferred shares were rendered worthless by bankruptcy; and hundreds lost their jobs. Sources alleged that Sandifur led an expansion, turning the family business into a $2.3 billion financial conglomerate that depended on selling unsecured debenture bonds to pay dividend obligations and finance new transactions. While Sandifur denied allegations and refused to admit any wrongdoing, he did agree to pay about $151,000 to resolve litigation. [KNDO NEWS: CORPORATE FRAUD]

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Published on Oct-31-07