WASHINGTON (AP) — Federal regulators have accused BankAtlantic Bancorp Inc., the parent of one of Florida's biggest banks, and its chief executive of misleading investors about the bank's financial health as its holdings of commercial real estate loans soured in 2007.
The Securities and Exchange Commission announced it filed civil charges Wednesday against the company and its CEO and Chairman Alan Levan. The SEC said the bank and its chief used accounting gimmicks to hide losses on a key group of loans. The SEC is seeking unspecified penalties and a ban against Levan serving as an officer or director of any public company.
"This is exactly the type of information that is important to investors, and corporate executives who fail to make that required disclosure will face severe consequences," SEC Enforcement Director Robert Khuzami said in a statement.
BankAtlantic Bancorp, based in Fort Lauderdale, Fla., is the parent of BankAtlantic, a savings bank with $3.7 billion in assets as of Sept. 30.
In a statement, Levan disputed the charges and said the parent company will contest them in court.
"We at BankAtlantic Bancorp are disappointed that the SEC has brought this action," Levan said. "At the end, we believe the SEC's credibility as a neutral enforcer of securities laws will be tarnished, as the case is unsupportable."
Eugene Stearns, an attorney representing BankAtlantic Bancorp and Levan, said the sort of data on loans the SEC faulted the company for failing to disclose was confidential and rarely made public by banks.