To read newspaper accounts of the man, Vijay Taneja was somewhat of a local celebrity in northern Virginia — “an icon in the local Indian community,” as the Washington Post reported it, and a man who invested heavily in Bollywood movie productions, India’s flush entertainment industry. But it appears he financed his high-rolling ways by committing massive mortgage fraud and ripping off lenders. Taneja pled guility earlier this week to one count of conspiracy to commit money laundering in connection with a mortgage fraud scheme involving his company, Financial Mortgage, Inc.; the company originated and sold mortgages on residential properties in the Washington, D.C., metropolitan area. According to court documents in support of the guilty plea, before FMI sold its mortgages to financial institutions as long term investors, FMI utilized warehouse lenders to temporarily fund the mortgages before they were sold. Beginning in 2001, FMI began defrauding a series of warehouse lenders and eventually two other financial institutions — including Wells Fargo Bank and EMC Mortgage Corp. — causing an accumulated loss of at least $33 million to four financial institutions by the time FMI filed for bankruptcy in June 2008. The fraud-related losses are the largest in Virginia in at least 20 years, according to prosecutors. Taneja would defaud his funding sources by selling the same loan to multiple investors and pocketing proceeds from refinancing transactions, rather than paying off a prior mortgage on a given property, the Federal Bureau of Investigation said in a press statement Thursday. Taneja invested millions of dollars of his fraudulently-obtained funds into Indian film and theater productions, the Washington Post reported, and investigators aren’t likely to find where all of the money really went. “He has millions of dollars unaccounted for,” Assistant U.S. Attorney Stephen Learned is quoted by the WaPo as telling the judge. “There’s so much money, and it’s difficult to figure out where it all went.” Sentencing is set for January 30, 2009; the maximum potential penalty for conspiracy to commit money laundering is 20 years incarceration and a fine of $500,000. Write to Paul Jackson at paul.jackson@housingwire.com.