MIAMI – Law360 reported on Rivero Mestre’s representation of Westernbank’s officers and directors in their suit with the Federal Deposit Insurance Corporation (the “FDIC”):
Executives and directors of the now-defunct Westernbank Puerto Rico asked a federal judge Wednesday to dismiss a $176 million Federal Deposit Insurance Corp. suit accusing the group of gross negligence in its handling of loans prior to the bank’s closure in 2010.
In a motion filed in the U.S. district court in Puerto Rico, the six former Westernbank executives and directors argue that the FDIC is trying to hold them accountable for not adequately anticipating the recent financial crisis — which had a devastating effect on the bank — even though financial luminaries including FDIC senior officials have admitted that nobody could have reasonably foreseen such a meltdown.
“The FDIC has embarked on a quest to scapegoat the bank’s officers and directors, whose lives have been as thoroughly turned upside down by this chain of events as any other investors or creditors,” the motion claimed. (Click here to see full article; click here to see the D&Os motion to dismiss the FDIC complaint).
Andrés Rivero, Jorge A. Mestre, Alan H. Rolnick, Charlie Whorton, and M. Paula Aguila of Rivero Mestre, represent six directors and officers of Westernbank of Puerto Rico. Over the course of fifty-two years, Westernbank grew from a small, community institution into one of the largest, most profitable, and healthiest banks in the Commonwealth of Puerto Rico. It did so by working hand in hand with the Office of the Commissioner of Financial Institutions of the Commonwealth of Puerto Rico (“OCFI”) and with federal regulators, rising from humble beginnings as a local Mayaguëz bank to become the Commonwealth’s second-largest, with branches throughout the island. Federal regulators and the OCFI conducted annual examinations and awarded Westernbank the highest possible score for twelve consecutive years, from 1993 to 2005. In 2010, while Westernbank, like everyone else, was working hard to ride out a global recession, the OCFI closed its doors, seized it, and appointed the FDIC as receiver. Now, the FDIC demands that Westernbank’s long-serving directors, officers, and their spouses be held personally liable for operating a bank to which federal regulators gave the highest marks until months before a worldwide economic collapse.