Bank Due Diligence

Outcome: Disclosed allegations of applicant theft resulting in client declining loan.

A bank considered financing a radio station majority owner. We learned four years prior to his loan application, subject borrowed $7 million to purchase the shares of the former majority shareholder of the same radio station. Two years later, when subject and a minority partner attempted to sell the radio station, a potential buyer declined his purchase offer when he identified four sets of books.The subject then failed to buy out the minority shareholder who filed suit against him charging he had stolen millions of dollars from the radio station.

Further research disclosed lawsuits against subject by accounting and law firms and several banks. Subject additionally co-owned a car dealership with his cousin and another partner. Cousin accused subject and other partner of improperly withdrawing $750,000 from dealership. Client declined loan.