Former Mainstreet Bank of Ashland chairman pleads guilty to misuse of bank bailout funds
Updated On: Aug 27 2013 12:52:40 PM CDT
The chairman of a Mid-Missouri bank pleaded guilty in federal court Monday to using nearly $400,000 in bank bailout funds to purchase a Florida condo.
Darryl Layne Woods, 48, of Columbia, waived his right to a grand jury and pleaded guilty to federal information that charges him with making a false writing. Woods was the chairman and chief financial officer of Mainstreet Bank of Ashland. He was also the chairman, president and majority shareholder of Calvert Financial Corporation, the bank holding company for Mainstreet Bank.
ABC 17 News first broke the story in Oct. 2012 when a former employee accused Mainstreet Bank of Ashland of fraud.
Sheriff's deputies served Mainstreet Bank of Ashland and its chief executive officer, John Cochran, with a separate civil lawsuit. The 39-page lawsuit was filed by a former bank employee who said she was asked to lie on legal documents.
Those documents stated Woods went around federal regulations to receive a $10,000 bonus that was not allowed. They also alleged he used nearly $400,000 to buy a condo in Fort Myers, Fla.
When ABC 17 News asked Cochran about the allegations that the bank misused Troubled Asset Relief Program (TARP) funds to buy a condominium in Florida, he replied, "You don't have time for a discussion on TARP funds."
Cochran said there were a number of factual errors within the court documents. He said the former employee making the allegations was never asked to falsify any information and there is documentation to refute those claims. However, he would not go as far to show that documentation.
According to federal authorities, the bank received more than $1 million in TARP funds in Nov. 2008.
Woods admitted to using $381,487 of those funds to purchase the condominium on Feb. 2, 2009.
He also failed to disclose in a Feb. 10, 2009 letter to the Special Inspector General for TARP that a significant portion of the funds had been used to acquire the condominium.
Woods' plea agreement means the government cannot charge him and his wife, Jackie Woods, with charges connected to Woods admitting to the misuse of funds. Also, Woods is required to remove himself from any further involvement in banking and cannot serve or be affiliated with any financial institution.
Woods is still subject to a one-year prison sentence and a fine of up to $100,000.
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