Re: Faith Base Banking
In that case, they should be careful what they wish for: Hebrew National's claim was that their standards were *stricter* than the government's, not that they were exempt from them. On Mon, May 10, 2010 at 7:37 PM, verizon alanarmstrong@verizon.netwrote: I think the bank was claiming something like Hebrew National's we answer to a higher authority. That is, they would be more friendly, transparent, and helpful than other banks. Maybe they would keep the borrower from getting a loan that could not be repaid. Alan Law Office of Alan Leigh Armstrong 18652 Florida St., Suite 225 Huntington Beach CA 92648-6006 714 375 1147 faz 714 782 6007 a...@alanarmstrong.com Serving the family and small business since 1984 On May 10, 2010, at 2:51 PM, Vance R. Koven wrote: I don't see any particular connection to religion at all here. Everybody seems to be saying they were in compliance with banking regulations, the securities laws and anything else they've been charged with violating. If there is going to be a claim that being a religious bank means they don't have to abide by whatever lending criteria the law establishes (and if they were out of compliance, I'd like to know what Fannie Mae and Freddie Mac's excuse was), it would strike me as both a last refuge of a scoundrel issue and a possible estoppel issue if they didn't make any exemption claims when obtaining their banking licenses (I don't know what regulations would apply to the borrower--there are already cases that hold a bank loan is not a securities transaction to which Rule 10b-5 would apply). There are, however, religious banks, in the sense of banks that apply religious law to their products, chiefly Islamic banks that structure products around the interest prohibition. Of course, Western banks also deal in such products for clients to whom the religious prohibitions matter. However, the NYT article doesn't suggest that Integrity was claiming a Christian loan is one that doesn't need to be repaid. Vance On Mon, May 10, 2010 at 2:30 PM, hamilto...@aol.com wrote: Sounds like religious insurance. They typically argue they should not have to abide by regulations and they discriminate on the basis of religion in hiring and in choosing customers As I remember there is a religious exemption for religious insurers in the health care law. Marci Sent from my Verizon Wireless BlackBerry -Original Message- From: Volokh, Eugene vol...@law.ucla.edu Date: Mon, 10 May 2010 11:13:12 To: 'Law Religion issues for Law Academics'religionlaw@lists.ucla.edu Subject: RE: Faith Base Banking ___ To post, send message to Religionlaw@lists.ucla.edu To subscribe, unsubscribe, change options, or get password, see http://lists.ucla.edu/cgi-bin/mailman/listinfo/religionlaw Please note that messages sent to this large list cannot be viewed as private. Anyone can subscribe to the list and read messages that are posted; people can read the Web archives; and list members can (rightly or wrongly) forward the messages to others. ___ To post, send message to Religionlaw@lists.ucla.edu To subscribe, unsubscribe, change options, or get password, see http://lists.ucla.edu/cgi-bin/mailman/listinfo/religionlaw Please note that messages sent to this large list cannot be viewed as private. Anyone can subscribe to the list and read messages that are posted; people can read the Web archives; and list members can (rightly or wrongly) forward the messages to others. -- Vance R. Koven Boston, MA USA vrko...@world.std.com ___ To post, send message to Religionlaw@lists.ucla.edu To subscribe, unsubscribe, change options, or get password, see http://lists.ucla.edu/cgi-bin/mailman/listinfo/religionlaw Please note that messages sent to this large list cannot be viewed as private. Anyone can subscribe to the list and read messages that are posted; people can read the Web archives; and list members can (rightly or wrongly) forward the messages to others. ___ To post, send message to Religionlaw@lists.ucla.edu To subscribe, unsubscribe, change options, or get password, see http://lists.ucla.edu/cgi-bin/mailman/listinfo/religionlaw Please note that messages sent to this large list cannot be viewed as private. Anyone can subscribe to the list and read messages that are posted; people can read the Web archives; and list members can (rightly or wrongly) forward the messages to others. -- Vance R. Koven Boston, MA USA vrko...@world.std.com ___ To post, send message to Religionlaw@lists.ucla.edu To subscribe, unsubscribe, change options, or get password, see http://lists.ucla.edu/cgi-bin/mailman/listinfo/religionlaw Please note that messages sent to this large list cannot
Faith Base Banking
Are there First Amendment issues here? Or more precisely, should there be bank regulations -- or civil rights regulations -- that preclude religious banks? Or is this just run-of-the-mill corruption (assuming the indictments lead to conviction, and the banks are not innocent). == The New York Times May 7, 2010 2 at Faith-Based Bank Are Indicted Over Bribes By ROBBIE BROWN ATLANTA — When government regulators here shut down Integrity Bank at the height of the recession, in August of 2008, the bank was seen as just another failed lender that had overvalued the real estate market and collapsed. But a federal indictment unsealed on Friday accused two former vice presidents at the bank of hastening its downfall by selling fraudulent loans to a hotel developer in exchange for bribes. The two executives, Douglas Ballard and Joseph Todd Foster, were charged with conspiracy, insider trading and bank fraud, according to the indictment. Mr. Ballard was also charged with bribery. The developer, Guy Mitchell, who received $80 million in loans, was charged with conspiracy and bribery. Founded on Christian principles in 2000 in an Atlanta suburb, Integrity used the motto “In God We Trust.” The bank gave customers free Bibles, and employees prayed together at meetings. Onetime investors included a Georgia state senator and the former CNN host Lou Dobbs. But in announcing the indictment, the United States attorney Sally Quillian Yates said Mr. Ballard and Mr. Foster had not lived up to the bank’s name or mission. “A number of banks have suffered from the plummeting real estate market, but this bank was robbed from the inside,” she said. Mr. Ballard, 40, and Mr. Foster, 42, could not be reached for comment on Friday and will be arraigned at a later date. Mr. Mitchell, 50, pleaded not guilty at a federal courthouse in Atlanta. A lawyer for Mr. Mitchell, Edward Garland, said his client had been a law-abiding, profitable customer for the bank. “The collapse of the economy caused the bank failure, not his activity,” Mr. Garland said. Georgia leads the nation in bank failures, with 38 banks having closed since 2007, according to the Federal Deposit Insurance Corporation. The state’s woes have generally been blamed on underregulation and overinvestment in real estate. But the Integrity case is a different matter. “These indictments are very unusual,” said A. James Elliott, associate dean of Emory University School of Law, an expert in banking law. From 2004 to 2006, Mr. Mitchell, who lives in Coral Gables, Fla., and has developed hotels, shopping centers and other commercial real estate, received the $80 million in loans from Integrity, the indictment says. His holdings include the upscale Casa Madrona Hotel and Spa in Sausalito, Calif., and the Royal Palm Hotel near Miami. The indictment charges that he obtained much of the money under false pretenses and deposited nearly $20 million in a personal checking account, with which he bought luxury items, including a $1.5 million private island in the Bahamas. The indictment charges that Mr. Mitchell made few, if any, payments on the loans. Instead, it says, he took additional loans, and his debt ballooned. In return for lenience, Mr. Mitchell paid Mr. Ballard more than $230,000 in bribes, the indictment says. It also accuses the two bank executives of engaging in insider trading by selling Integrity stock. “After passing out $80 million to the developer like it was Monopoly money, both officers dumped their Integrity stock before the failed loans came to light,” Ms. Yates said. But Mr. Garland, the defense lawyer, said Mr. Mitchell was in compliance with banking regulations and merely used a central bank account for both personal and business expenses, adding, “We expect to show that he is completely innocent.” Integrity reported assets of $1.1 billion when it was sold to a unit of the Regions Financial Corporation in 2008. The bank had been a prominent example of faith-based banking in Georgia, with five locations. The bank’s founder, Steven M. Skow, a Lutheran, said it gave away 10 percent of annual profits to churches and faith-based charities, donating $1.7 million in 2007. Mr. Skow said it did not discriminate against non-Christians. “We weren’t selling religion,” he said. “We just managed the bank on godly principles, like the golden rule.” Mr. Skow, who left the bank in 2007 and was not implicated in the indictment, said he knew nothing about the activities at the heart of the indictment. He said he had lost $22 million in stock when the bank failed. Ms. Yates, the United States attorney, said the investigation into Integrity was continuing. Paul Finkelman President William McKinley Distinguished Professor of Law Albany Law School 80 New Scotland Avenue Albany, NY 12208 518-445-3386 (p) 518-445-3363 (f)
RE: Faith Base Banking
I’m not sure I even quite understand the question – what exactly constitutes a “religious bank” that would be prohibited, while “secular banks” would be permitted? Eugene From: religionlaw-boun...@lists.ucla.edu [mailto:religionlaw-boun...@lists.ucla.edu] On Behalf Of Paul Finkelman Sent: Monday, May 10, 2010 11:07 AM To: Law Religion issues for Law Academics Subject: Faith Base Banking Are there First Amendment issues here? Or more precisely, should there be bank regulations -- or civil rights regulations -- that preclude religious banks? Or is this just run-of-the-mill corruption (assuming the indictments lead to conviction, and the banks are not innocent). == The New York Times May 7, 2010 2 at Faith-Based Bank Are Indicted Over Bribes By ROBBIE BROWNhttp://topics.nytimes.com/top/reference/timestopics/people/b/robbie_brown/index.html?inline=nyt-per ATLANTA — When government regulators here shut down Integrity Bank at the height of the recessionhttp://topics.nytimes.com/top/reference/timestopics/subjects/r/recession_and_depression/index.html?inline=nyt-classifier, in August of 2008, the bank was seen as just another failed lender that had overvalued the real estate market and collapsed. But a federal indictment unsealed on Friday accused two former vice presidents at the bank of hastening its downfall by selling fraudulent loans to a hotel developer in exchange for bribes. The two executives, Douglas Ballard and Joseph Todd Foster, were charged with conspiracy, insider trading and bank fraud, according to the indictment. Mr. Ballard was also charged with bribery. The developer, Guy Mitchell, who received $80 million in loans, was charged with conspiracy and bribery. Founded on Christian principles in 2000 in an Atlanta suburb, Integrity used the motto “In God We Trust.” The bank gave customers free Bibles, and employees prayed together at meetings. Onetime investors included a Georgia state senator and the former CNN host Lou Dobbshttp://topics.nytimes.com/top/reference/timestopics/people/d/lou_dobbs/index.html?inline=nyt-per. But in announcing the indictment, the United States attorney Sally Quillian Yates said Mr. Ballard and Mr. Foster had not lived up to the bank’s name or mission. “A number of banks have suffered from the plummeting real estate market, but this bank was robbed from the inside,” she said. Mr. Ballard, 40, and Mr. Foster, 42, could not be reached for comment on Friday and will be arraigned at a later date. Mr. Mitchell, 50, pleaded not guilty at a federal courthouse in Atlanta. A lawyer for Mr. Mitchell, Edward Garland, said his client had been a law-abiding, profitable customer for the bank. “The collapse of the economy caused the bank failure, not his activity,” Mr. Garland said. Georgia leads the nation in bank failures, with 38 banks having closed since 2007, according to the Federal Deposit Insurance Corporationhttp://topics.nytimes.com/top/reference/timestopics/organizations/f/federal_deposit_insurance_corp/index.html?inline=nyt-org. The state’s woes have generally been blamed on underregulation and overinvestment in real estate. But the Integrity case is a different matter. “These indictments are very unusual,” said A. James Elliott, associate dean of Emory Universityhttp://topics.nytimes.com/top/reference/timestopics/organizations/e/emory_university/index.html?inline=nyt-org School of Law, an expert in banking law. From 2004 to 2006, Mr. Mitchell, who lives in Coral Gables, Fla., and has developed hotels, shopping centers and other commercial real estate, received the $80 million in loans from Integrity, the indictment says. His holdings include the upscale Casa Madrona Hotel and Spa in Sausalito, Calif., and the Royal Palm Hotel near Miami. The indictment charges that he obtained much of the money under false pretenses and deposited nearly $20 million in a personal checking account, with which he bought luxury items, including a $1.5 million private island in the Bahamas. The indictment charges that Mr. Mitchell made few, if any, payments on the loans. Instead, it says, he took additional loans, and his debt ballooned. In return for lenience, Mr. Mitchell paid Mr. Ballard more than $230,000 in bribes, the indictment says. It also accuses the two bank executives of engaging in insider trading by selling Integrity stock. “After passing out $80 million to the developer like it was Monopoly money, both officers dumped their Integrity stock before the failed loans came to light,” Ms. Yates said. But Mr. Garland, the defense lawyer, said Mr. Mitchell was in compliance with banking regulations and merely used a central bank account for both personal and business expenses, adding, “We expect to show that he is completely innocent.” Integrity reported assets of $1.1 billion when it was sold to a unit of the Regions Financial Corporationhttp://topics.nytimes.com/top/news/business/companies
Re: Faith Base Banking
Sounds like religious insurance. They typically argue they should not have to abide by regulations and they discriminate on the basis of religion in hiring and in choosing customers As I remember there is a religious exemption for religious insurers in the health care law. Marci Sent from my Verizon Wireless BlackBerry -Original Message- From: Volokh, Eugene vol...@law.ucla.edu Date: Mon, 10 May 2010 11:13:12 To: 'Law Religion issues for Law Academics'religionlaw@lists.ucla.edu Subject: RE: Faith Base Banking ___ To post, send message to Religionlaw@lists.ucla.edu To subscribe, unsubscribe, change options, or get password, see http://lists.ucla.edu/cgi-bin/mailman/listinfo/religionlaw Please note that messages sent to this large list cannot be viewed as private. Anyone can subscribe to the list and read messages that are posted; people can read the Web archives; and list members can (rightly or wrongly) forward the messages to others. ___ To post, send message to Religionlaw@lists.ucla.edu To subscribe, unsubscribe, change options, or get password, see http://lists.ucla.edu/cgi-bin/mailman/listinfo/religionlaw Please note that messages sent to this large list cannot be viewed as private. Anyone can subscribe to the list and read messages that are posted; people can read the Web archives; and list members can (rightly or wrongly) forward the messages to others.
Re: Faith Base Banking
I don't see any particular connection to religion at all here. Everybody seems to be saying they were in compliance with banking regulations, the securities laws and anything else they've been charged with violating. If there is going to be a claim that being a religious bank means they don't have to abide by whatever lending criteria the law establishes (and if they were out of compliance, I'd like to know what Fannie Mae and Freddie Mac's excuse was), it would strike me as both a last refuge of a scoundrel issue and a possible estoppel issue if they didn't make any exemption claims when obtaining their banking licenses (I don't know what regulations would apply to the borrower--there are already cases that hold a bank loan is not a securities transaction to which Rule 10b-5 would apply). There are, however, religious banks, in the sense of banks that apply religious law to their products, chiefly Islamic banks that structure products around the interest prohibition. Of course, Western banks also deal in such products for clients to whom the religious prohibitions matter. However, the NYT article doesn't suggest that Integrity was claiming a Christian loan is one that doesn't need to be repaid. Vance On Mon, May 10, 2010 at 2:30 PM, hamilto...@aol.com wrote: Sounds like religious insurance. They typically argue they should not have to abide by regulations and they discriminate on the basis of religion in hiring and in choosing customers As I remember there is a religious exemption for religious insurers in the health care law. Marci Sent from my Verizon Wireless BlackBerry -Original Message- From: Volokh, Eugene vol...@law.ucla.edu Date: Mon, 10 May 2010 11:13:12 To: 'Law Religion issues for Law Academics'religionlaw@lists.ucla.edu Subject: RE: Faith Base Banking ___ To post, send message to Religionlaw@lists.ucla.edu To subscribe, unsubscribe, change options, or get password, see http://lists.ucla.edu/cgi-bin/mailman/listinfo/religionlaw Please note that messages sent to this large list cannot be viewed as private. Anyone can subscribe to the list and read messages that are posted; people can read the Web archives; and list members can (rightly or wrongly) forward the messages to others. ___ To post, send message to Religionlaw@lists.ucla.edu To subscribe, unsubscribe, change options, or get password, see http://lists.ucla.edu/cgi-bin/mailman/listinfo/religionlaw Please note that messages sent to this large list cannot be viewed as private. Anyone can subscribe to the list and read messages that are posted; people can read the Web archives; and list members can (rightly or wrongly) forward the messages to others. -- Vance R. Koven Boston, MA USA vrko...@world.std.com ___ To post, send message to Religionlaw@lists.ucla.edu To subscribe, unsubscribe, change options, or get password, see http://lists.ucla.edu/cgi-bin/mailman/listinfo/religionlaw Please note that messages sent to this large list cannot be viewed as private. Anyone can subscribe to the list and read messages that are posted; people can read the Web archives; and list members can (rightly or wrongly) forward the messages to others.
Re: Faith Base Banking
I think the bank was claiming something like Hebrew National's we answer to a higher authority. That is, they would be more friendly, transparent, and helpful than other banks. Maybe they would keep the borrower from getting a loan that could not be repaid. Alan Law Office of Alan Leigh Armstrong 18652 Florida St., Suite 225 Huntington Beach CA 92648-6006 714 375 1147 faz 714 782 6007 a...@alanarmstrong.com Serving the family and small business since 1984 On May 10, 2010, at 2:51 PM, Vance R. Koven wrote: I don't see any particular connection to religion at all here. Everybody seems to be saying they were in compliance with banking regulations, the securities laws and anything else they've been charged with violating. If there is going to be a claim that being a religious bank means they don't have to abide by whatever lending criteria the law establishes (and if they were out of compliance, I'd like to know what Fannie Mae and Freddie Mac's excuse was), it would strike me as both a last refuge of a scoundrel issue and a possible estoppel issue if they didn't make any exemption claims when obtaining their banking licenses (I don't know what regulations would apply to the borrower--there are already cases that hold a bank loan is not a securities transaction to which Rule 10b-5 would apply). There are, however, religious banks, in the sense of banks that apply religious law to their products, chiefly Islamic banks that structure products around the interest prohibition. Of course, Western banks also deal in such products for clients to whom the religious prohibitions matter. However, the NYT article doesn't suggest that Integrity was claiming a Christian loan is one that doesn't need to be repaid. Vance On Mon, May 10, 2010 at 2:30 PM, hamilto...@aol.com wrote: Sounds like religious insurance. They typically argue they should not have to abide by regulations and they discriminate on the basis of religion in hiring and in choosing customers As I remember there is a religious exemption for religious insurers in the health care law. Marci Sent from my Verizon Wireless BlackBerry -Original Message- From: Volokh, Eugene vol...@law.ucla.edu Date: Mon, 10 May 2010 11:13:12 To: 'Law Religion issues for Law Academics'religionlaw@lists.ucla.edu Subject: RE: Faith Base Banking ___ To post, send message to Religionlaw@lists.ucla.edu To subscribe, unsubscribe, change options, or get password, see http://lists.ucla.edu/cgi-bin/mailman/listinfo/religionlaw Please note that messages sent to this large list cannot be viewed as private. Anyone can subscribe to the list and read messages that are posted; people can read the Web archives; and list members can (rightly or wrongly) forward the messages to others. ___ To post, send message to Religionlaw@lists.ucla.edu To subscribe, unsubscribe, change options, or get password, see http://lists.ucla.edu/cgi-bin/mailman/listinfo/religionlaw Please note that messages sent to this large list cannot be viewed as private. Anyone can subscribe to the list and read messages that are posted; people can read the Web archives; and list members can (rightly or wrongly) forward the messages to others. -- Vance R. Koven Boston, MA USA vrko...@world.std.com ___ To post, send message to Religionlaw@lists.ucla.edu To subscribe, unsubscribe, change options, or get password, see http://lists.ucla.edu/cgi-bin/mailman/listinfo/religionlaw Please note that messages sent to this large list cannot be viewed as private. Anyone can subscribe to the list and read messages that are posted; people can read the Web archives; and list members can (rightly or wrongly) forward the messages to others. ___ To post, send message to Religionlaw@lists.ucla.edu To subscribe, unsubscribe, change options, or get password, see http://lists.ucla.edu/cgi-bin/mailman/listinfo/religionlaw Please note that messages sent to this large list cannot be viewed as private. Anyone can subscribe to the list and read messages that are posted; people can read the Web archives; and list members can (rightly or wrongly) forward the messages to others.
