Bank executive admits to using bailout money to buy condo
In November 2008, during the depths of the financial crisis, Darryl Layne Woods, a bank executive in Missouri, applied to the United States Treasury for bailout money. His bank received $1 million.
Just days later, Mr. Woods used $381,000 of that money to buy a waterfront condominium in Fort Myers, Fla.
On Tuesday, Mr. Woods, the former chairman of Mainstreet Bank in Ashland, Mo., pleaded guilty to criminal charges in Federal District Court in Jefferson City, Mo.
"At a time when many other Americans were losing their homes, he was siphoning off public funds to buy a luxury vacation condo in Florida," said Tammy Dickinson, the United States attorney for the Western District of Missouri.
The investigation was led by the special inspector general for the Troubled Asset Relief Program, or Sigtarp. The office, now headed by Christy Romero, has policed the use of the bailout money since the fund was established, and has been responsible for criminal cases filed against more than 140 individuals.
Prosecutors also accused Mr. Woods of covering up the scheme. In February 2009, a week after buying the Florida condominium, he sent a letter to Neil Barofsky, then the head of Sigtarp, in response to a request for more information regarding how Mainstreet used the bailout money it received.
Mr. Woods made no mention of his real estate purchase in the three-page letter to Mr. Barofsky.
"We are a small central Missouri community bank and while I would like to be able to provide you with very specific and quantitative responses we are currently operating under the assumption that the worst scenario could occur and the TARP proceeds will provide vitally needed infusions to a bleeding patient," Mr. Woods wrote.
Under the terms of his plea agreement, Mr. Woods must desist from any further involvement in banking. Under federal law, he is subject to a sentence of up to a year in prison. His lawyer, James R. Hobbs, did not immediately return a request for comment.
—By Peter Lattman, The New York Times.