FDIC sues bank connected to Giannoulias
ASSOCIATED PRESS March 7, 2012 6:18PM
Updated: April 10, 2012 11:28AM
The Federal Deposit Insurance Corp. has filed a $104 million lawsuit against the failed family bank of former Illinois treasurer and Senate candidate Alexi Giannoulias alleging “gross negligence.”
Broadway Bank was founded by Giannoulias’ father. It was shutdown in 2010 when it couldn’t raise new capital.
The lawsuit filed Wednesday alleges breaches of fiduciary duty of former directors and officers who approved risky loans. The lawsuit alleges the defendants approved the worst loans in 2008 after a meeting with bank regulators.
Brothers Demetris Giannoulias, president and CEO, and George Giannoulias, chairman, are named as defendants in the lawsuit, along with seven others.
Alexi Giannoulias, worked at the bank until 2005, is not named as a defendant. It was often brought up during his 2010 Senate campaign with allegations of shady loans, including to political insider Antoin “Tony” Rezko.
Messages left for Giannoulias weren’t immediately returned.