Director Loan Committees Are Special Targets of the FDIC
By Harold P. Reichwald
The Bank Board LetterJanuary 2012
More than 400 banks have been closed since the onset of the financial crisis in mid-2008. During that time, more than 300 lawsuits have been authorized to be brought against officers and directors of the failed banks, according to the FDIC. Presumably, the vast majority of authorized suits seek recoveries from D&O insurance carriers for the alleged negligence and gross negligence of former officers or directors. A sizable number of those suits – those actually filed and those authorized but not filed – have targeted directors who were members of the directors’ loan committee of the failed bank. We have seen cases where the FDIC targeted only those committee members and not directors who were not on such a committee.
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