After a year laden with economic failure and the domino effect of corrupt millionaire bank CEO’s and the collapse of their beloved institutions, what’s another sad financial story? Well, only the sixth-biggest bank failure in U.S. history—with over 350 branches and $26 billion in assets seized (most of which BB&T took over)—otherwise known as Colonial Bancgroup, an institution largely responsible for the big, messy burst of the real estate bubble and the destruction it left in its wake. And who does our great nation have to thank for helping to further deplete the FDIC and bang one more nail into the coffin of our economy?
Reportedly none other than Bobby Lowder, who recently retired as CEO and chairman of the banking giant and is a trustee at Auburn University. Lowder, who developed a reputation at Auburn for being a belligerent intimidator who once made a death threat to a fellow board member over a disagreement (sounds like a nice guy) is being named as a primary defendant for charges of reckless and dishonest conduct being brought upon Colonial through a number of class-action lawsuits.
With an FBI investigation pending into Colonial’s warehouse-lending business (which extends short-term lines of credit to mortgage brokers so they can make individual loans, which are then sold, packaged, and securitized), one positive thing to note is that Colonial never received the $550 million bailout they sought out last fall like many of their other lucky competitors. And as the man who signed on the dotted line of all the bank’s financial statements, he better hope there is no indication of fraud on that TARP contract or he may be cheering for his beloved Tigers team from a cell rather than the plush luxury suite he still owns in the Auburn stadium. Yeah, good luck with that.
Via: CNN Money