Two Former Executives Of Bailed Out Bank Indicted

During the financial crises of 2008-09, many U.S. banks took government bailouts. One of them, United Commercial Bank of San Francisco, collapsed anyway after taking $300 million from the U.S. taxpayers.

Now, two former executives of United Commercial have been indicted on criminal and civil fraud charges over their alleged roles in trying to hide losses on loans. Former chief operating officer Ebrahim Shabudin and first vice-president Thomas Yu face four counts each.

The charges include conspiracy, securities fraud, falsifying corporate books and records, and making false statements to the accountants of a public company. The two men appeared in court this week and were released on bond.

United Commercial took close to $300 million in federal bailout money in November 2008 and eleven months later, was shut down by the Federal Deposit Insurance Corporation (FDIC). At the time, it was said to have more than $11 billion in assets, with branches in Hong Kong and Shanghai.

The Securities and Exchange Commission (SEC) has filed suit against the two former executives, along with former CEO Thomas Wu, charging they concealed more than $60 million in losses.