Voyager Bank in Legal Battle With Ousted CEO
Eden Prairie-based Voyager Bank on Tuesday accused its former CEO Tim Owens of bilking the company out of nearly $15 million in personal loans, according to a Star Tribune report.
The allegations were reportedly filed in court just hours after Owens-who was fired by the company-sued Voyager for wrongful termination.
When Voyager's board ousted Owens in August, the company said that the departure was related to loan losses of about $9.7 million, but it did not say why Owens had to go or what role he had in the loss, according to the Star Tribune.
On Tuesday, Owens-a 51-year-old Wayzata resident-filed a suit accusing the bank, its holding company Voyager Financial Services Corporation, and a number of the company's officers and directors of conspiring to use him as a scapegoat for bad decisions that hurt bank profits, oust him, and gain control of his Voyager stock at historically depressed prices, the Minneapolis newspaper reported.
Within hours, Voyager reportedly accused Owens in court filings of deceptively obtaining nearly $15 million in personal loans by hiding correspondence from regulators, fabricating a document, forging the company's chairman's signature, and lying about his financial condition.
Voyager said in its motion that the loans included a series of loans totaling about $5 million made directly from the bank's holding company to Owens, and loans he got from two other banks-$7.5 million from Alliance Bank and $2.2 million from Tradition Capital Bank, according to the Star Tribune. Owens was reportedly unable to repay the loans, and Voyager claims to have paid off the $9.7 million that Owens owed those banks.
The bank claims that Owens used the money to maintain a lifestyle that included a $4.5 million Lake Minnetonka home, a $2.5 million lake cabin, and Bentley and Aston Martin cars. The bank also claims that Owens funneled more than $5 million in loan proceeds to his wife, according to the Star Tribune.
Owens' lawyer Richard Ostlund told the Star Tribune that the bank's allegations “were dredged up by these defendants to excuse their own failure to act properly as officers and directors.” He added that none of the bank's allegations were part of the original notice it sent Owens last summer telling him to pay off all his loans in 10 days or he would be terminated “for cause.”
In his complaint, Owens reportedly said that he was encouraged to borrow money from Voyager to buy Voyager shares.
According to the Star Tribune, things began to unravel in September 2010 after the Minnesota Department of Commerce examined the bank and pointed out various violations of banking laws and regulations based on the loans made to Owens. Last June, a group of state and federal bank regulators reportedly attended a bank board meeting, shortly after which the board voted to terminate Owens.
“I had hoped that Tim and his lawyer would reach some sort of amicable settlement with us, and it didn't happen,” Bill Dunkley, chairman of Voyager Financial Services Corporation, told the Star Tribune.