Prohibitions from future service in federally insured financial institutions and, in one case, an order of restitution for $111,196, are doled out in consent orders with former employees of banks in Alabama and Tennessee issued May 26 by the Federal Reserve Board and announced Thursday.
The Fed Board also announced the termination of a formal agreement from 2009 with bank holding company First Flo Corporation (Florence, Colo.).
The prohibitions of three individuals are dealt with in two consent orders of prohibition. One was with former Regions Bank (Birmingham, Ala.) employee Matthew Curtis, who was barred for grand theft and fraudulent use of identification information – charges for which he was convicted – in connection with his lending activities. Curtis is required to pay the $111,196 in restitution to the bank.
That’s the amount Curtis fraudulently took, over two transactions on Dec. 13, 2018, and Jan. 3, 2019, from the account of Robert and Bonnie Ripp and applied to another couple, Barry and Dorothy Kirsner, who “appeared unaware” of Curtis’s actions and had “no apparent ties” to him, the order stated. The order said Curtis used the larger stolen amount of $98,005.10 to pay off the Kirsners’ private mortgage loan (Curtis altered documents to make it look like it was a loan approved by the bank, when the bank had actually denied the couple’s previous loan application), and the smaller amount, $13,190.90, was transferred directly to their deposit account.
In the second consent order, the Fed said that Aaron K. Hill and Jessica A. Hill, former employees of Evolve Bank & Trust (Memphis, Tenn.), were barred for engaging in unsafe and unsound practices while running a loan production office. The order states that from at least October 2017 to November 2018, while managing a loan production office (LPO) in Louisville, Ky., first for Evolve and then for First Savings, Aaron Hill engaged in unsafe and unsound practices and breaches of fiduciary duty, including:
- concealing the Hills’ ownership and control of a third-party vendor used by the LPO to manage mortgage leads in violation of the policies and procedures of Evolve and First Savings;
- causing the firm to overcharge Evolve and First Savings through duplicative or inflated invoices, resulting in financial loss to the banks;
- misrepresenting to Evolve and First Savings that Jessica Hill was qualified to work and did perform work at Evolve and First Savings; and
- effectively managing and operating the First Savings LPO after First Savings had declined to retain him as an employee of First Savings.
During the same period, the order states, Jessica Hill, while “nominally” an employee of the loan production office, engaged in unsafe or unsound practices and breaches of fiduciary duty, “including accepting compensation from Evolve and First Savings when she did not report to work nor perform her duties, which allowed Aaron Hill to use her position and credentials to manage the First Savings LPO and submit Vendor invoices to First Savings for payment.”
The order says both Aaron and Jessica Hill must cooperate with and help the Fed Board in connection with the investigations of whether enforcement action should be taken against Evolve or First Savings, or other individuals.