Colonial BancGroup Inc. was a bank holding company headquartered in Montgomery, Alabama, United States that failed in 2009.

The BancGroup had interests in several residential and commercial real estate developments located in the southeastern United States, as well as two in the central Texas area.

Starting in 2002, Kissick, Farkas and their co-conspirators engaged in a series of fraudulent actions to cover up the overdrafts, first by sweeping overnight money from one Taylor, Bean & Whitaker account with excess in another, and later through the fictitious "sales" of mortgage loans to Colonial Bank, a fraud the conspirators dubbed "Plan B."

Court records show the conspirators sent mortgage data to Colonial Bank for loans that didn't exist or that Taylor, Bean & Whitaker had already committed or sold to other third-party investors.

[5] Colonial disclosed its legal problems on August 4, 2009, stating that federal agents had executed a search warrant at its mortgage warehouse lending offices in Orlando, Fla. and that it had been forced to sign a cease and desist order with the Federal Reserve and regulators at the end of last month in relation to its accounting practices and its recognition of losses.

[14] The closely watched case could lead to billions of dollars in damages depending on how a jury answers a fundamental question in accounting: How much responsibility do auditors have for catching fraud?

But in a pretrial brief issued by the trustee, former PricewaterhouseCoopers chairman Dennis Nally is quoted in a 2007 Wall Street Journal article saying that the "audit profession has always had a responsibility for the detection of fraud".