On July 30, 2015, the Department of Justice (DOJ) announced that
Timothy Owens, CEO and Chairman of Voyager Bank and CEO of the
bank's holding company, Voyager Financial Services Corporation
(VFSC), pleaded guilty for obstructing an examination by the Board
of Governors of the Federal Reserve (Fed). The guilty plea is the
result of an investigation by the Fed, the Consumer Financial
Protection Bureau, the Federal Deposit Insurance Corporation, the
Federal Housing Finance Agency, and the Federal Bureau of
Investigation of Owens' conduct and representations during the
Fed's 2009 investigation of VFSC. Owens was indicted in
December 2014.
The Fed examined VFSC with a focus on the bank holding
company's internal controls relating to loans to insiders and
attendant credit risks. According to the DOJ complaint, examiners
were aware that VFSC issued three loans to Owens. The Fed, in a
letter that Owens received personally, demanded that VFSC review
its loans to Owens and ensure that such loans were consistent with
bank policies. However, Owens did not share the letter with the
board and prepared a response to the Fed.
The prosecutor alleged that Owens' response to the Fed did not
disclose a fourth $1 million loan and misrepresented that the
response had been reviewed and approved by the VFSC board. The
prosecutor alleged that Owens misrepresented his financial
circumstances, as well as those of the bank, to end the Fed's
examination.
Owens' plea highlights the liability that officers and
directors of financial institutions can face as a product of
regulatory examinations of their institutions.
Owen's is scheduled to be sentenced later this year.
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