Ousted Chairman of Failed Bank Sues Regulators

Gerald J. Garner, ousted chairman of failed American Commerce National Bank, has sued federal regulators in an effort to recover his Anaheim bank and win $75 million in damages.

Garner’s lawyer, Robert M. Silverman, said an amended complaint providing details of Garner’s claims would be filed late this week or early next week. The banker filed a three-page, bare-bones lawsuit last month to meet a statutory deadline.

The suit, which has been expected since regulators closed the bank on April 30, now alleges that the regulators wrongly took over a healthy bank, depriving shareholders and customers of their property without due process. The amended complaint, he said, will involve many more allegations.

The Office of the Comptroller of the Currency, which ordered the takeover and is named as a defendant, has said that turning the bank over to a receiver was proper because Garner and his directors and officers concealed records, and lied and wasted bank assets to such an extent that the agency couldn’t tell if the bank was financially sound.

Garner and other shareholders have maintained that, while it had an excessive amount of bad loans, the bank was profitable and adequately financed.

The lawsuit was filed in U.S. District Court on behalf of Garner, other shareholders and bank customers.