M&T has agreed to settle a criminal case over the disclosure of bad loans by predecessor Bank Wilmington Trust. The settlement will total $60 million.
The settlement led to a delay in the trial of former executives of the bank, who will now need to prepare their case without the bank. See related story.
David Weiss, the U.S. Attorney for Delaware announced the following terms in the settlement:
- WT admits that it agreed to submit Monthly Regulatory Reports to the Federal Reserve.
- Those reports included past due loan information.
- The past due loan numbers submitted to the Federal Reserve did not include past due loans that WT chose to “waive.”
- We say that those monthly reports were false. These facts and those set forth in the Civil Forfeiture Complaint filed earlier today, provide a basis to forfeit the proceeds of this unlawful activity.
- As a result, WT and the USAO have agreed to a total settlement amount of $60 million, which credits WT with its prior payment to the SEC in the amount of $16 million and requires an additional forfeiture paymentof $44 million.
- WT agrees to cooperate with the U.S. Attorney’s office going forward. In return, the U.S. Attorney has agreed to dismiss all criminal charges pending against WT, and the parties have agreed to exchange mutual releases.
“Wilmington Trust Company has been a fixture in this community for more than 100 years. This is why the bank’s decline and the fire sale acquisition by M&T Bank was such a significant development in this community; and why this office has invested substantial time, energy and resources in the investigation and prosecution of this case,” Weiss stated.
Weiss continued, “To function effectively, our financial markets require accurate disclosures—and regulators need to receive accurate information. That didn’t happen here. We believe today’s resolution accomplished three important objectives. First, we secured a substantial payment for victims who sustained losses as a result of what transpired. Second, WT accepted responsibility for its actions. And third, if possible, we wanted to avoid the collateral consequences of a criminal conviction for the bank, which could have resulted in the loss of jobs and revenue for our community.”