Federal Deposit Insurance Corp. is suing three former executives of Washington Mutual Bank, claiming their negligence and caused the collapse of the Bank the largest bank failure of 2008-the history of the United States. The civilian prosecution of 900 million dollars is one of the most ambitious attempts of FDIC Bank executives sue over alleged wrongdoing during the financial crisis. The complaint accuses former senior officer Kerry k. Killinger, the former VP of operations Stephen Jay Schneider, former President David loans rotla c. take "extreme and unprecedented risks historically," with the Bank's portfolio of loans to boost their wages.
"They are focused on short-term profits to increase their own compensation, reckless disregard long-term safety of WaMu, soundness," according to the complaint. The lawsuit was filed Wednesday in u.s. District Court at Seattle, where WaMu Nazis. Their "gross negligence, breach of duty caused WaMu to lose billions of dollars," the complaint said. A written statement Thursday, said an FDIC rotla "is unfounded." "It is patently unfair for the FDIC to watch a man have perfect foresight into crisis, FDIC itself did not see coming," rotla said.
Killinger said in a statement: "the allegations are factual fiction ... The trial court with respect for the rule of law and not the will of Washington-will confirm that Kerry Killinger, Washington mutual responsibility and commitment, perseverance and consistently served the interests of the depositors, customers and its shareholders. "
The FDIC was not unexpected. Starting from Tuesday, the FDIC claims against financial crisis 158 people with damage claims at least 3.57 billion dollars. It includes five names 39 people in lawsuits, according to the FDIC's Web site. Washington State newspaper, business journal in Puget Sound, reported earlier this year the former WaMu executives sent letters to the regulator warned of possible legal steps. Posts are used routinely to a device.
WaMu was a big player in the subprime mortgage sector, where banks made loans to high-risk borrowers. When the economy began to falter in the borrowers failed to make their mortgage payments, such as WaMu to huge losses on these loans. After a run on the Bank, the FDIC seized WaMu in September 2008 and sold its assets j.p. Morgan Chase & co. & 1.8 billion. The debt holders, shareholders, including TPG, a private equity giant headed by David Bonderman, lost billions for the collapse of WaMu. FDIC is negotiating with WaMu property bond, financiers, and j.p. Morgan Chase.