Bank CEO Uses Bailout Money To Purchase Luxury Condo In Florida
And people wonder why CEOs get such a bad rap…
A corrupt former bank CEO, Darryl Lane Woods, unlawfully used government bailout cash—for Mainstreet Bank—to purchase his own luxury suite, which overlooks the ocean, in Florida, Business Insider reports.
Back in 2008, Woods, was head of the Missouri-based bank when he applied for the Troubled Asset Relief Program (TARP). The following year, in January, his bank obtained $1,037,000. Only a month later, in February 2009, Woods used about 37 percent of the cash ($381,487) to buy his waterfront condo in Fort Myers, Fl.
Woods’ fradulent use of Mainstreet Bank’s bailout money is exactly what TARP detractors’ feared when the program launched four years ago: “One big criticism of the $700 billion TARP program since it began in October [of 2009] is the general lack of understanding of how the program is being run and where the money is going,” Forbes added. “The government designed it to kick start the credit markets by getting banks to lend again, but evidence from the regulators themselves shows banks have been hoarding cash, guarding capital and tightening lending.”
With the government often refraining from asking what these banks plan to do with their bailout money (aka our tax dollars), Forbes rightly predicted that the government assistance program leaves the door open for fraud.
Fast-forward to 2013, and although Woods is certainly not the only one to misuse TARP, bailout critics are beginning to see their speculations unfold.
Tammy Dickinson, the U.S. Attorney for the Western District of Missouri, announced that Woods pleaded guilty in court on Wednesday. Here’s what she had to say:
At a time when many other Americans were losing their homes, he was siphoning off public funds to buy a luxury vacation condo in Florida. These federal funds were intended to help stabilize the economy during a fiscal crisis. Instead, this disgraced business leader took advantage of the situation to benefit himself and other bank executives, then lied to federal investigators in an attempt to hide his scheme
The former CEO can no longer work in the bank industry. He faces one year in prison, without parole, with a $100,000 fine.