Former Illinois banker fined and prohibited
The FDIC has issued a stipulated order for a $5,000 civil money penalty and an order of prohibition to John B. Ptak, former president, chief financial officer and member of the board of directors of Edgebrook Bank, Chicago, Illinois. The FDIC determined, and Ptak neither admits nor denies, that Ptak:
- perpetrated a scheme to obscure the financial condition of the Bank through the masking of lending losses
- without the knowledge or permission of the Board, approved, and caused the Bank to pay, post-possession expenses of borrowers who purchased OREO properties and real estate previously owned by delinquent borrowers, including real estate taxes, utility bills, repair, and renovation costs
- violated an FDIC Cease and Desist Order, issued May 31, 2012, by engaging in lending practices after being prohibited from doing so.
- engaged in a series of unsafe and unsound practices with relating to a $1,800,000 loan in April of 2014 and a second loan in the amount of $280,000 to the same guarantor in October 2014, who misappropriated $475,000 in loan proceeds for his personal use. Those two loans violated the Bank's legal lending limit under Section 32 of the Illinois Banking Act.
- facilitated the falsification of a loan commitment and facilitated the approval, closing and funding of a $1,000,000 that was in violation of a March 18, 2015 FDIC Temporary Cease and Desist Order
- recklessly engaged in unsafe and unsound conduct and practices, repeatedly breached his fiduciary duty as an executive officer and director of the Bank, and violated final cease and desist orders.