We’re likely to see more of these.
A group of investors in the parent of Georgian Bank have filed suit against two former top officials, claiming they failed to disclose important information about the bank’s condition before it spiraled out of control and was shut down in September 2009, AJC staffer Scott Trubey reports.
The suit filed in Fulton State Court claims Gordon Teel and Lynn Darby “negligently misrepresented” Georgian’s financial condition in the months before regulators closed the Atlanta-based bank. Teel is a former chairman of Georgian Bancorporation and was the bank’s president and CEO. He resigned in July 2009 and was replaced as chairman by Darby.
Georgian Bancorporation shareholders Paul Wilkerson, R. Lynn Wilson and Marigene Doyal claim they relied on the defendants’ statements about the bank’s finances, and continued to hold their stock as its condition worsened, Trubey writes.
The shareholders lost their investment the day the bank failed.
The shareholder suit is one of the few filed so far in Georgia against the directors or officers of failed banks. Many more are expected as investors seek to recoup losses from Georgia’s banking crisis, Trubey writes.
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