Lowder, McGregor, Dye and other Colonial Bank officials settle suit for $10.5 M

[Coach Hank Crisp]

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BIRMINGHAM, Alabama -- Officers and directors of failed Colonial BancGroup, including Auburn University trustee Bobby Lowder and former AU football coach Pat Dye, have agreed to pay investors $10.5 million to settle a class-action suit that claims they misled investors.

The terms of the proposed settlement were outlined in documents filed this week in U.S. District Court in Montgomery. Lowder, Dye, gambling promoter Milton McGregor and 20 other former Colonial officials have asked the judge overseeing a parallel case in U.S. Bankruptcy Court in Montgomery to let them pay the settlement money with proceeds from an insurance policy covering directors and officers.

The shareholder lawsuit sought $900 million in damages after Montgomery-based Colonial failed in 2009, was seized by the government as insolvent, and sold to North Carolina-based BB&T Corp., which took over the branches and some of the assets.

All shareholders saw their holdings wiped out when the company was seized by state regulators in August 2009 and filed for bankruptcy protection a few days later. The Federal Deposit Insurance Corp. initially estimated the failure would cost its deposit fund $2.8 billion. Colonial's failure is the sixth largest ever of a U.S. bank.

[rueben]

Pshshshsh. Not near high enough to be punitive for B.L. and Co.

[N.AL-Tider]

Pshshshsh. Not near high enough to be punitive for B.L. and Co.

That's what you get when you allow rich people to establish their own punishments...

Wonder how it would work out if the common, everyday criminal could try that?

[SUPERCOACH]

If I'm not mistaken, that many will be paid from the proceeds of an insurance policy too.  So nothing out of pocket for those crooks.

[BAMAWV]

Pshshshsh. Not near high enough to be punitive for B.L. and Co.

That's what you get when you allow rich people to establish their own punishments...

Wonder how it would work out if the common, everyday criminal could try that?

Explain, please!

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