Las Vegas NowSilver State Bank Execs Made Millions Prior to Failure

Silver State Bank Execs Made Millions Prior to Failure

At the end of 2007, Silver State Bank had a profit of about $25 million. In the first six months of 2008, that profit turned into an $88 million loss, mainly because of foreclosures. For the loss, the president and CEO, as well as the executive ice president of commercial real estate lending walked away with millions.

As Debbie Ingham counted her losses for choosing Silver State Bank to hold her hard earned money, some executives counted their profits.

Ingham works as a bus aide, making sure special education kids get to school. She and her husband moved to Las Vegas 12 years ago. The sale of their home in Ohio at the height of the housing boom netted more than $120,000. She put it in two separate accounts at Silver State Bank thinking both were protected.

Read the SEC Filings for Silver State Bank

When it went under, the FDIC added her accounts and took more than $20,000 because she was over the insured limit, "I am furious, because, and I know they knew, they are the ones doing the business. They know what they are doing."

Her anger is directed at Corey Johnson, the bank's former president and CEO. Johnson resigned August 1, 2008. The bank went under on September 5, 2008. His resignation was labeled a re-organization.

Eyewitness News obtained his employment contract. According to that contract, voluntary termination because of a reorganization triggered Johnson's golden parachute. He gets a lump sum payment in cash equal to three times his executive compensation within five days of the termination.

According to the company's 2007 annual report, that means Silver State Bank would hand Johnson a check for $2.1 million. If he did not resign, he would have received his base salary of $350,000.

"He should be prosecuted to the fullest extent of the law and his money seized. And I would like to see that money distributed to all of the uninsured people like me," said Ingham.

The bank's executive vice president for commercial loans, Douglas French, sold 161,000 shares of stock in the month of February. The bank's abysmal first quarter report came out three months later.

French made almost $1.7 million by selling before their customers knew the bank was in trouble.

"It's like the titanic. They are the first class passengers. They jump ship. They left all the rest of us to go down with the boat," said Ingham.

Silver State Bank no longer exists. The insured deposits were eventually taken over by Nevada State Bank. The FDIC wouldn't let Nevada State Bank have the uninsured deposits according to a spokesman.

The Nevada Department of Business and Industry says the FDIC would have to look into any wrongdoing. Calls to the FDIC were not returned.

Email your comments to Reporter Edward Lawrence