Tuesday, September 23, 2014

Allegations of FRAUD by OCC Deputy against FNB????

Straight from the Horses Mouth!

In an April 2014 story in the San Antonio Express News by Patrick Danner, OCC Deputy Comptroller Gil Barker stated that only three national banks in Texas had been shut down since the great depression.  

Those three banks, 
La Coste National Bank (2010), 
First National Bank Edinburg (September 2013) 
and most recently,  
Texas Community Bank of The Woodlands (February 2014) were the institutions Barker was referring to.

However, Barker went on to state that in 
"Two of those situations, there was fraud".

So let's take a look and see just for shits and giggles if one can figure out which bank wasn't closed with elements of fraud.

In 2011, the President of La Coste Bank went to federal prison after pleading guilty to making a false entry in the bank's books with the intent to defraud and deceive banking regulators.  OK, there's one of the two fraud cases Barker referred to from his April 2014 statement.  One down, one to go!

Now, let's look at Texas Community Bank.  The Office of Inspector General's Material Loss Review was released this summer and there was no mention of fraud as to why the bank failed and was shut down.

Uh Oh!  
I think the music stopped and there's no more chairs!

OK, let's flashback to February 2011 and look at the OCC Consent order issued to FNB.  It states below:



(1) The Board shall require and the Bank shall immediately take all necessary steps to correct each violation of law, rule, or regulation cited in the most recent Report of Examination (“ROE”), any subsequent ROE, or brought to the Board’s or Bank’s attention in writing by management, regulators, auditors, loan review, or other compliance efforts. 

So is one to assume that the good deputy of the OCC has confirmation of fraudulent violations of FNB and/or their officers/directors during their tenure??  

After all, it was only a cool $637,000,000 loss!

Just can't wait to get a copy of that ROE!!

Monday, September 22, 2014

Bank Executive Pleads Guilty to Fraud Charges; Are FNB Exec's in the FDIC's cross hairs?


Criminal Charges more common

A former TierOne Bank executive has pleaded guilty to defrauding the failed bank's shareholders and federal banking regulators.  It is the first criminal charge filed in connection with the bank's financial collapse.  

Don Langford, who was a senior vice president and chief credit officer at the Lincoln bank, pleaded guilty in U.S. District Court to conspiring to commit securities fraud, wire fraud and making false entries in a bank’s books and records, as well as one count of making false statements.

He faces as many as five years

 in prison on each count 

when he is sentenced Dec. 5. The criminal charge and pleading were filed in U.S. District Court of Nebraska on Tuesday. Langford also faced federal civil litigation in the case. 

“When the real estate market crashed, Don Langford, the chief credit officer and a senior vice president of TierOne Bank, worked with others to cook the bank’s books and cover up mounting losses,” Assistant U.S. Attorney General Leslie R. Caldwell said in a news release. 

“This conviction is another example of 

the Criminal Division’s pursuit of 

corporate executives who commit 

fraud, no matter what their title or 


According to the criminal information filed with his plea agreement,  Langford, 63, of Gibsonia, Pennsylvania, and others who were not named falsely inflated the value of TierOne’s loan and real estate portfolio in its required reports to the U.S. Securities and Exchange Commission and the Office of Thrift Supervision in 2009 and 2010.

In January 2009, TierOne had executed a supervisory agreement with the Office of Thrift Supervision that required TierOne to report information about its performance and financial condition and to maintain a minimum capital position in relation to its loan portfolio and other assets. Langford and others intentionally used outdated appraisals on properties, and rejected new appraisals that would have adversely affected TierOne’s reportable assets, revenue and earnings, the Justice Department said.

In addition, they delayed seeking new appraisals to conceal the current value of collateral and restructured loan terms to disguise the borrower’s inability to make timely interest and principal payments, according to the filing. As a result, Langford and others were able to hide millions of dollars in losses from regulators and investors.