Monday, October 11, 2010

FDIC May Seek More Than $1 Billion From Failed-Bank Executives

The Federal Deposit Insurance Corp. is going after over 50 failed bank officers and directors, to collect losses caused by the financial crisis. The agency is hoping to recoup more than $1 billion from credit crisis losses. reports:

    The lawsuits were authorized during closed sessions of the FDIC board and haven’t been made public. The agency, which has shuttered 294 lenders since the start of 2008, has held off court action while conducting settlement talks with executives whose actions may have led to bank collapses, Richard Osterman, the FDIC’s acting general counsel, said in an interview.

    “We’re ready to go,” Osterman said. “We could walk into court tomorrow and file the lawsuits.”

    The FDIC, which reviews losses for every bank failure, has brought only one case against officers or directors tied to recent collapses -- a suit filed in July seeking $300 million in damages from four executives of IndyMac Bancorp Inc.

    When a bank fails, the agency’s investigators take about 18 months to complete their autopsies, meaning most of the probes stemming from the financial crisis are ongoing, Osterman said.

Continue reading here…

Blog Archive