OTS Seeks Contempt Action Against Former CenTrust Chairman
MIAMI (AP) _ The government on Tuesday sought a civil contempt order against former CenTrust Chairman David Paul for not posting a $30.8 million bond.
Paul was ordered to post the bond to prevent him from squandering money from the failed thrift. He has challenged the administrative order, but a judge rejected his arguments and Paul’s attorneys said they would appeal.
The Office of Thrift Supervision alleged Tuesday that Paul has made no effort to provide any portion of the security required by the agency’s temporary cease and desist order.
Paul’s Miami attorney, Sandy Bohrer, did not immediately return a telephone call seeking comment.
U.S. District Judge Edward Davis earlier this month rejected arguments by Paul’s attorneys that OTS was improperly pursuing enforcement actions without benefit of due process or trial, and cited an ″important governmental interest″ in protecting depositors’ interests.
Federal regulators took over CenTrust, once Florida’s largest thrift, in February at an estimated loss of $1.8 billion.
Spending that has been questioned by regulators includes purchases of Old Masters paintings, a $15 million legal defense fund for thrift officers and directors, and a private dinner at Paul’s home, cooked by European chefs flown in for the occasion.