ELIZABETH—First BankAmericano, which was founded 12 years ago by state Sen. Raymond Lesniak to take advantage of a demand for financial services among the Hispanic community, has been shut down by state and federal regulators.
The state Department of Banking and Insurance joined with the Federal Deposit Insurance Corporation (FDIC) to close the bank and turn over control of its operations to Brick Township-based Crown Bank. The FDIC estimates that the cost to taxpayers will be $15 million.
First BankAmericano has been under the scrutiny of regulators since August 2007. The bank received a second ‘cease and desist order’ on June 19 from the FDIC outlining various unsound lending practices and loose banking procedures. Among the specific charges were inadequate earnings, liquidity and regard for funds management with respect to deposits of about $157 million.
Although he initially founded the bank and headed its board of directors, Lesniak has been serving as the board’s vice chairman in recent years and he did not comment on the enforcement action.
Lesniak is chairman of the Economic Growth Committee, vice chair of the Commerce Committee, plus he serves on the Legislative Services Commission, the Judiciary Committee and the Legislative Oversight Committee.
One of the state’s most influential power brokers, Lesniak has emerged as a central figure at the intersection of political, legal and business interests.
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