According to today’s Wall Street Journal (subscription required), Thornburg Mortgage’s $11 billion loan portfolio has found a buyer:

Select Portfolio Servicing Inc., a Salt Lake City mortgage-servicing business owned by Credit Suisse Group (CS), won the auction for Thornburg’s portfolio with a winning bid of about $95 million, according to Joel Sher, the failed lender’s Chapter 11 trustee.

If this summary of the Better Business Bureau file on Select is accurate, the sale could be bad news for homeowners who took out loans with Thornburg, which before its bankruptcy last year had a pretty good reputation for customer service:

“Based on BBB files, this company has unsatisfactory record with the BBB due to unanswered and unresolved complaints.

“The BBB processed a total of 136 complaints about this company in the last 36 months, our standard reporting period. Of the total of 136 complaints closed in 36 months, 59 were closed in the last year.”

The news agency today follows up on the sell-off of Thornburg Mortgage’s $11 billion-plus in servicing rights, which SFR mentioned in its year-end wrapup:

NEW YORK, Jan 4 (Reuters) – Bankrupt U.S. mortgage lender Thornburg Mortgage Inc (THMRQ.PK) is seeing “wide interest” in the auction for its $11 billion mortgage servicing portfolio…

Dozens of traditional mortgage banks, banks, hedge funds, private equity firms, and special servicers have expressed interest in the portfolio.

Of that group, more than 20 are likely to meet qualifications to bid on the portfolio this week…

Interesting tidbits keep turning up in the Thornburg Mortgage bankruptcy case, one of the largest in US history.

Court documents show that in October, the company, now known as TMST, had $24 million in the bank (or rather, banks—foremost among them being New Mexico Bank & Trust). That month alone, TMST made a gross profit of $2.2 million from servicing mortgages—and has made $19.9 million since filing for bankruptcy in May. After legal fees and “general and administrative” costs, TMST has netted $816,773 since the bankruptcy. Of course, all that belongs to its creditors.

The case is also shedding light on what kind of tax burden one of Santa Fe’s largest private employers faces, or rather, doesn’t.

Since filing for bankruptcy, the company has paid a $107,850 in combined state and federal taxes—or 13 percent of its net profit in that time. For comparison’s sake, check out the federal income tax brackets. A married couple making the median income in Santa Fe is going to pay 15 percent. Such a couple is likely to pay property taxes, as well—unlike TMST, which pays no property taxes on its corporate HQ, thanks to a clever deal with the city of Santa Fe.

Click on the image below for a breakdown of TMST’s tax payments.

Note that TMST, which laid off 130 workers in April and more since, has paid all of $973 in unemployment taxes in the months since its bankruptcy. Two years ago, Gov. Bill Richardson—who has received many thousands in campaign contributions from company founder Garrett Thornburg over the years—signed into law a bill that cut employer unemployment tax payments to the lowest rate allowed by federal law, saving corporations an estimated $26 million in 2008.

More on Thornburg after the cut.

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Recently forced-out Thornburg Mortgage CEO Larry Goldstone told KSFR of his plans to start a bank back in March, before the company went bankrupt. Listen to the segment at their site.

The interview, which KSFR’s Bill Dupuy has dredged from the archives, raises some interesting questions.

First: If Goldstone had already announced his intentions on the radio, why was Thornburg Mortgage’s then-spokeswoman so cagey when SFR reported on the new company’s existence later in the summer? One likely explanation: Because, as the Justice Department has charged, the new company’s employees were being paid with money that belonged to the bankrupt company’s creditors.

The Journal North managed to raise Goldstone on the phone for their front-page story today, but he didn’t say much. Over at the Santa Fe Review, George Johnson uses personal experience to explain the nut of this story: “the $8,000 I invested in the company is now down to $6, while Mr. Goldstone is still receiving $188,000 a month from the bankrupt company.”

And from the paper whose business writer quoted the company’s founder in 1995, “Thornburg makes a compelling argument that a crisis large enough to shake the mutual fund industry to its core is not very likely”; the paper that editorialized in 2004, “The community should be glad [Thornburg] didn’t grow weary of NIMBYism and forsake Santa Fe for Santa Barbara or some other la-di-dah address”; and the paper that declared Thornburg Mortgage “back in the game” just before it went bust?

Crickets.

Updated Sept. 18, 7 am: There we go. How does Bob Quick spell FU? “Their resignations…first reported by Reuters.”

Pretend you’re a newspaper. Don’t worry, it’s only temporary.

Now say one of the largest corporate bankruptcies in US history occurs on your turf. Then imagine that, in the course of the bankruptcy case, federal investigators determine the company’s management—which includes some of your city’s wealthiest and most prominent citizens—has “improperly divert[ed]” company resources and “cannot now be entrusted” to act transparently and honestly.

Unfortunately, your business reporter has been cut to part-time. But you still think this might be story worth mentioning, right? Right?

Not if you’re the Santa Fe New Mexican. Or the Albuquerque Journal.

This morning a US Justice Department official asked federal bankruptcy judge to take action against Thornburg Mortgage over claims of misappropriated funds discussed in today’s SFR. The filing, by Assistant US Trustee Mark A Neal, basically says Thornburg management should be removed by the court because they used creditors’ money to fund startup costs for an entirely new company. (Some management has already departed, as we reported yesterday.)

A story last week by Reuters—the international news wire service, which the dailies presumably keep tabs on—hinted something like this might be coming. And the story of the new company won’t be news to SFR readers. But shouldn’t the dailies be on this? A federal official is basically saying the CEO of what was one of Santa Fe’s largest private employers—a company local politicians both praised and rewarded—is untrustworthy and may have spent money that wasn’t his.

“Not only is candor to the Court and [creditors] lacking in this case, but [Thornburg Mortgage] violated chapter 11’s basic prohibition on the use of estate assets,” Neal writes in his filing. “Furthermore, the use of [Thornburg Mortgage]’s employees by its most senior officers to staff start-up aspects of a new and undisclosed company is, at its very best, strong evidence of incompetence and/or gross mismanagement.”

Thornburg employees paid to work for the new company, SAF Financial, “are likely to instead prioritize their work in favor of an emerging entity, owned by insider management, that may offer them future employment. The creation of this…conflict-of-interest is the doing of current management, which cannot now be entrusted to perform their fiduciary obligations,” Neal writes.

Click here to download the 14-page filing.

SFR has tried to get a message to company founder Garrett Thornburg, who—unlike Thornburg Mortgage CEO Larry Goldstone and CFO Clarence Simmons—is not named in Neal’s filing. (That’s Thornburg, pictured.) It’s probably past time for him to address these issues.

We’ll let you know if and when we get a response. Neal did not immediately return a request for comment.

Thornburg Mortgage is not commenting on anything at all.