A former manager of a bank that received millions in Troubled Asset Relief Program funds has been found guilty of bank fraud, TARP’s Special Inspector General announced Friday.
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From 2007 to 2009, Phillip Owen approved and recommended over $200,000 in fraudulent loans while branch manager for Superior Financial Services, a bank in Attalla, Alabama. Despite the $69 million federal bailout Superior and its parent company, Superior Bancorp, received in 2008, the entire operation failed by 2011.
“Owen overvalued vehicles that were the subject of loan applications, disbursed loan proceeds to individuals not entitled to such disbursements or involved in the loan transaction, and prematurely released collateral used to secure loans,” the announcement explained. “Owen approved the loans, certified that he had verified the loan applicants’ information knowing he had not done so, and recommended that other loans be approved. In exchange for approving the fraudulent loans, Owen was occasionally compensated with narcotics.”