A U.S. District Court judge this afternoon sentenced Pierce County’s king of bad home loans to 10 years in federal prison for falsifying dozens of loans that eventually defaulted, bringing down a local bank and casting many people into foreclosure.
Shawn Portmann, 40, pleaded guilty last fall to two counts of conspiracy to submit false loan applications and submitting false statements to a financial institution to obtain a loan.
The failure of dozens of those loans led to the demise of Pierce Commercial Bank, where Portmann had served as a senior vice president, and foreclosure for many people who were approved for mortgages they couldn’t afford. At his September plea hearing, Portmann told U.S. District Judge Benjamin Settle that he’d fabricated employment, financial and housing records to ensure loans would be funded.
Portmann was one of the nation’s top home-loan generators during the housing bubble. Federal prosecutors contended he and his employees generated nearly $1 billion in home loans between 2006 and 2008, raking in huge profits in the process. Federal prosecutors said Portmann pocketed $1.7 million a year during that time.
Nine of Portmann’s employees previously have pleaded guilty and been sentenced to prison terms for their roles in the fraud.
” … Portmann risked the future of the bank and well-being of his staff and home buyers in order to satiate his own greed and ego,” federal prosecutor Brian D. Werner wrote in a sentencing memorandum. “Portmann’s conduct, moreover, was emblematic of the housing bubble, that is, tell any lie necessary, get paid first and push the problems that come with home finance on to someone else, another bank, the next borrower or the government.”
Werner recommended a sentence of 14 years, which was the high-end of the range agreed to by Portmann’s attorneys during plea negotiations.
The defendant’s attorneys, Robert G. Chadwell and Krista K. Bush, recommended a sentence of 10 years, which was the low end of the negotiated range.
They argued their client was physically and emotionally abused as a child growing up poor in Puyallup. Portmann “threw himself into his work” as an adult to try to overcome his upbringing, they said.
“The fear of losing what he did not have as a child and had worked so hard to gain as an adult lurked behind many of the decisions he made to do whatever was necessary to continue to close loans,” Chadwell and Bush wrote in their sentencing memorandum. “This insight is not offered to excuse Mr. Portmann’s behavior — he is fully responsible for his actions and is not arguing otherwise — but to provide an explanation that is firmly grounded in his personal history and character …”
Nearly two dozen people wrote letters on Portmann’s behalf.
Real estate agent J.B. Downie was once. Downie called Portmann generous, caring and hard-working.
“… this is what I want people to know about Shawn: Shawn Portmann is a good person who cared about me and people around him,” Downie wrote. “It makes me sad to read articles about him that portray him as an evil dictator that yelled and swore and tried to manipulate and take advantage of every person he met.”
Portmann also filed a statement with the court, in which he apologized.
“I have no one but myself to blame, and I look to no one else to excuse my behavior,” he wrote. “I was arrogant and angry, and I misused my position at the bank. I am humbled and profoundly saddened by my actions, my poor judgment and the harm I have caused everyone involved.”