May 11, 2015
By Bob Coleman
Editor, Mug Shot Monday
Add Poppi Metaxas to the list of community bankers jailed after her bank received TARP funds.
She faces five years in prison for her guilty plea of bank fraud for her role in defrauding the bank of $1.8 million.
‘While Gateway Bank was applying for TARP and being told by its federal banking regulator to raise capital and to reduce the amount of toxic assets on its books, bank president and CEO Poppi Metaxas orchestrated a fraudulent ‘round-trip’ transaction that masked the true health of the bank,’ says Christy Romero, Special Inspector General for TARP (SIGTARP).
‘Metaxas’ criminal scheme involved ‘selling’ $15 million in non-performing assets to outside investors, secretly using bank money to fund the buyers’ 25 percent down payment, and deceiving the board and the bank’s regulator about the source of the down payment.
‘Metaxas’ crime and cover up made the bank look healthier than it was while its TARP application was pending. SIGTARP and its law enforcement partners will ensure that justice is served for perpetrators of TARP-related crime.’
‘As Gateway Bank struggled to survive under the burden of its accumulated toxic assets, its CEO Poppi Metaxas turned to sham transactions to deceive regulators and convince them that the bank had rid itself of its bad loans and underwater real estate holdings,’ says Acting United States Attorney Currie. ‘Today’s guilty plea puts bank officers on notice that they will be brought to justice if they resort to lies and deceit to fix mistakes of the past.’