Bank chairman admits using public funds to buy vacation home
Mon, 26 Aug 2013 21:58:59 GMT —
A Columbia bank chairman pleaded guilty in federal court today to misleading federal investigators about his use of $381,000 in bank bailout funds to purchase a luxury condominium in Fort Myers, Fla.
Darryl Layne Woods, 48, of Columbia, waived his right to a grand jury and pleaded guilty to making a false writing.
Woods was the chairman and chief financial officer of Mainstreet Bank in Ashland, Mo. He was also the chairman, president and majority shareholder of Calvert Financial Corporation, the bank holding company for Mainstreet Bank.
â??The purpose of TARP is to promote financial stability and lending in a time of national economic crisis, not to bankroll the purchase of luxury vacation properties for bank executives,â?? said Christy Romero, Special Inspector General for TARP (SIGTARP).
â??When SIGTARP required Mainstreet Bank to disclose how it spent TARP funds, bank Chairman and CFO Woods failed to tell the truth that within days of receiving the TARP funds, the bank spent more than a third of the funds purchasing a waterfront condo in Florida for his and other executivesâ?? use. SIGTARP and our law enforcement partners will hold accountable and bring to justice those guilty of crimes related to TARP.â??
In November 2008, Calvert Financial applied to receive funds through the Troubled Asset Relief Program (TARP). TARP was created through the Emergency Economic Stabilization Act of 2008. The purpose of TARP was to provide capital to financial institutions to enable them to build their capital base and to increase the flow of financing to businesses and individuals. The U.S. Department of Treasury approved the request for TARP funds, and in January 2009 Calvert Financial received $1,037,000 through the TARP Capital Purchase Program.
Woods admitted today that he used $381,487 of the TARP funds to purchase the luxury condominium on Feb. 2, 2009.
The Special Inspector General for the Troubled Asset Relief Program (SIGTARP) was required to supervise, audit and investigate institutions that received TARP funds. SIGTARP sent letters to various financial institutions seeking specific information as to how TARP funds were used by the institutions. Woods responded to that inquiry in a letter dated Feb. 10, 2009.
Woods failed to disclose in his letter that a significant portion of TARP funds had been used to acquire the condominium. Failure to disclose the purchase of the condominium was a material misrepresentation of facts relating to the true use of TARP funds.
Woods is subject to a sentence of up to one year in federal prison without parole, plus a fine up to $100,000 and an order of restitution. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
Under the terms of his plea agreement, Woods is required to desist from any further involvement in banking and may not serve as an officer, director, employee or affiliated party of any financial institution or agency.