The FDIC is suing former leaders of a one-time area bank.
In a suit filed February 14 in U.S. District Court in Atlanta, the Federal Deposit Insurance Corporation filed a civil lawsuit against eight former executives and officers at Habersham Bank.
Those eight former bank officers are David D. Stovall, Edward D. Ariail, Bonnie C. Bowling, Michael C. Martin, Michael L. Owen, M. Edward Hoyle, Frank E. Felker, and Andrew Coker.
The suit has accused the eight of negligence, gross negligence, and breach of fiduciary duty in the operation and management of the lending function of the Bank.
In the suit, the FDIC alleged that the defendants failed to properly oversee the Bank’s lending function.
Among other things, the FDIC alleged the defendants recommended and approved loans that violated the bank’s internal loan policies and safe banking practices, improperly extended credit to borrowers who were not creditworthy, and extended credit based on inadequate financial information about the financial condition of prospective borrowers.
The FDIC said in the suit it is seeking to recover more than $15 million in compensatory damages.
Habersham Bank was based in Clarkesville and operated offices in Stephens County and throughout north Georgia before it was closed by the FDIC in February 2011.