The first company, Equityplus Financial, distributed almost $6 million each to principals Shumway and Bapst in 1998 and 1999, according to documents made available for a suit brought by a former employee.
When they filed for a mortgage lender license under the Calusa name in 2001, Shumway and Bapst each reported income of more than $9 million the year before. Shumway said he expected to make nearly $10 million in 2001. Bapst estimated his income would be more than $5 million that year.
In March, federal regulators closed Guaranty National Bank in Tallahassee, which, with the Community Bank of Northern Virginia, was accused in lawsuits of predatory lending.
(Takumi Harada - Tallahassee Democrat)
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In addition, Shumway estimated that his holdings in Equity Guaranty and a related company were worth $3.2 million, and he owned a home worth nearly $2 million. He noted that he had filed for bankruptcy in 1996.
Bapst listed his interest in Equity Guaranty at $1.4 million, two Mercedes-Benzes and a Lincoln Navigator, and a $1.7 million home. He now lives in a McLean home his wife purchased for $3.2 million in 2002.
Virginia banking regulator Face said in prefiled testimony for the licensing hearing that he first learned about a Shumway-related company in 1998, when his office required another state bank to terminate a relationship with Equityplus Financial because it was brokering mortgage loans without a license. The Shumway-Bapst company then went to work with the Community Bank of Northern Virginia. State regulators objected, Face said, and finally persuaded the bank's board to end the relationship.
David P. Summers, president of Community Bank, did not return several calls last week seeking comment. The bank has 13 branches and more than 120 employees in Northern Virginia.
Disciplinary Actions
The Office of the Comptroller of the Currency, which regulates national banks, issued an enforcement action against the Florida bank in early 2002, charging it with poor oversight of its operations. The action caused a commotion in the Shumway-Bapst camp because GMAC Residential Funding stopped buying the loans, Shumway said in a letter filed in the Virginia license proceeding.
In May of last year, the comptroller's office disciplined the Florida bank again, requiring it to cease arrangements with third parties "in which the bank receives fees in return for the use of its name." It also called on the bank to identify borrowers who never received disclosures when they were turned down for loans by the bank's office in Chantilly. The announcement of the bank's closing this March said Guaranty National failed to correct its violations of consumer laws.
Among the documents Calusa submitted to Virginia regulators as part of its license appeal were examiners' reports from four states. One from Kentucky last August criticized the company for using a title company at the same location that "may be gouging" consumers by charging fees that in some cases were twice the going rate. Shumway responded by telling the state that an internal audit had found the problem and that refunds were given to the borrowers.
There are indications the refunds were not made until after the examiner cited them. The letters referring to audits were undated, and the refunds were dated the same day as Shumway's reply to the state.
Scott Borison, a Frederick lawyer who represents several homeowners with loans generated by the Shumway-Bapst operation, said loan officers from their companies are now working across the region. On one bank's Web site, a loan officer notes that he worked for both the Community Bank of Northern Virginia and for Guaranty National Bank of Tallahassee.
Staff writer Sandra Fleishman and staff researcher Richard Drezen contributed to this story.
