In a long-expected ruling, the Federal Deposit Insurance Corp. has banned a former Connecticut thrift executive from banking.
William Wilcox, the former president of the Savings Institute of Willimantic, had been accused in lawsuits by former employees of, among other things, pressuring subordinates to cook the books and plotting to discredit a rival by planting cocaine on him.
The FDIC order, issued last month, culminated a 14-month investigation by the agency.
Mr. Wilcox, according to the order, engaged in unsafe or unsound practices and violations of banking laws that 'demonstrate the respondent's unfitness to serve as a director, officer, person participating in the conduct of the affairs, or as an institution-affiliated party of the bank."
Mr. Wilcox resigned under pressure a year ago. Neither he nor his attorney, Hope Seeley of Hartford-based Santos & Seeley, could be reached for comment.
While the FDIC's order doesn't describe Mr. Wilcox's alleged misdeeds, the ban was preceded by the filing of a slew of lawsuits by former co- workers, two of them alleging financial improprieties at the thrift.
A suit filed almost two years ago by former chief financial officer Robert Costa, accuses Mr. Wilcox of pressuring the plaintiff to violate accounting laws and cook the thrift's books to inflate profits.
The most recent suit was filed in March by Ann Adams, Mr. Wilcox's former executive secretary. It alleges that after informing the FDIC of alleged innapropriate behavior toward employees and banking law violations by her boss, she was harassed and threatened by him despite promises by that agency and the Federal Bureau of Investigation that the thrift's board and attorneys would protect her from retribution. She eventually quit and fled to Florida out of fear, the suit alleges.
In particular, according to the $5 million suit, Mrs. Adams provided the FDIC with information about the thrift's loans to a personal friend of Mr. Wilcox, Ronald Miller, to support the purchase of a marina in nearby Clinton, Conn. Sources say the agency was investigating that loan relationship as questionable.
Several other suits are also pending. Two accuse Mr. Wilcox of concocting an elaborate plot to discredit a rival banker, Savings Bank of Rockville president William McGurk, by planting cocaine on him. Those two suits were filed last year by Leonard Morganson, a former senior vice president at Savings Institute and Kenneth Foisie, president of Connecticut Financial Network, a brokerage that operated for several years out of Savings Institute offices and shared revenue with the thrift.
The suits allege that Mr. Wilcox harbored a grudge against Mr. McGurk because of a failed merger between the two thrifts several years ago.
The plaintiffs also claim that Mr. Wilcox harassed them when they wouldn't cooperate, even canceling the brokerage's agreement with the thrift and seizing its records.
Mr. Wilcox filed countersuits accusing Mr. Morganson and Mr. Foisie of slander. In addition, a suit filed by the thrift against the brokerage alleges that Mr. Foisie cheated the thrift on a 1990 stock trade.
That suit and the suits and countersuits involving the alleged cocaine plot had been winding their way through the state's courts over the past year but have now been consolidated into one case, scheduled to be heard next January.
Rheo A. Brouillard, who took over as president and chief executive of Savings Institute several months ago, said thrift officials have contacted the plaintiffs about settling the cases, but no decisions have been made.
Dennis O. Brown, attorney for several of the plaintiffs, said bank officials have indicated a willingness to mediate, but not settle.
"When they get serious about actually wanting to pursue settlement, they'll make an offer that's reflective of the potential liability that they face, which I believe is fairly significant," Mr. Brown said. "Predicting juries is a hard thing to do, but this is the kind of extreme and outrageous conduct that leads to multimillion-dollar jury awards."