7/23/2010 Records: CEO Jerry Williams, Dave Wa…

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Records: CEO Jerry Williams, Dave Wannstedt,

judges among failed Orion’s investors
By LAURA LAYDEN
Posted April 17, 2010 at 4:01 p.m.

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NAPLES — The collapse of Orion Bank in Naples left

behind a trail of angry investors.

Investors in the bank’s holding company ran the gamut,

from judges and attorneys to developers and accountants.
There are hundreds of them.

Many of the investors live in Naples or other parts of

Florida, including Key West, Sarasota and Gainesville.
The then-Orion Bank at the Others come from states as far away as New York and
northeast corner of California.
Goodlette-Frank Road and
Golden Gate Parkway/ KEN
LANE An otherwise confidential list of shareholders in Orion
Bancorp Inc. has surfaced as part of a court action to sell Most Popular
Documents off the holding company’s assets to pay off its debts in the Viewed Commented Emailed
aftermath of the bank’s failure in November and takeover
Orion Bancorp by IberiaBank of Lafayette, La. Bonnie downgraded to tropical
Shareholders depression
Updated 7/23/2010 at 5:04 p.m. 43 com m ents
IberiaBank, a publicly traded bank, took over Orion’s
deposits and branches, but not its private shares. POLL: Mom goes to jail because of son's
absences
Updated 7/22/2010 at 2:01 p.m. 156 com m ents

There are 405 “holders” of private stock identified on Orion Bancorp’s registration list.
FGCU professor killed himself at Naples
Some names are repeated two or three times, with a different number of shares, waterfront bar
Published 7/21/2010 at 5:06 p.m. 105 com m ents
indicating multiple holdings.
Collier School Board candidates sound
off on ‘kick a Jew day’ at forum
Jerry Williams, Orion’s embattled ex-CEO, owned the Published 7/22/2010 at 8:00 p.m. 56 com m ents
most shares – 798,323.
VIDEO: Lee deputy suspended, after DUI,
property damage charge
The second-largest number of shares – 613,994 – were in Published 7/23/2010 at 11:29 a.m. 21 com m ents

Orion Bancorp’s employee stock ownership plan with

401(k) benefits. Photo Galleries

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7/23/2010 Records: CEO Jerry Williams, Dave Wa…

Hundreds of bank employees, who counted on cashing out

their shares in retirement, could lose everything. They were
Jerry J. Williams, former encouraged to invest in the holding company’s stock.
Collier County Catch of the Tropical
chairman of Orion Bank. arrests 07-23- day: Depression
(Naples Daily News file) 10 Southwes… Bonnie
For those who did invest, money came out of their
paycheck every two weeks to buy shares. Nine days
before the bank closed, Williams continued to give them reasons for optimism.
Weather
“Our team is working through the credit cycle and doing a great job in this difficult Currently 36-Hour Your Photos
economy and current regulatory environment,” he wrote in an e-mail obtained by the Currently Today
Daily News. “The economy has taken its toll in all of the communities where we do
92°
business, but Orion is preparing to take advantage of new opportunities. There are
positive signs of recovery in our communities.”
81°
Partly Cloudy 78°
Wind: SE 13mph

*****
More Weather »

In October of last year, Williams told employees he planned to give them each a $100
Orion gift card, plus an additional vacation day in 2010, for the holidays, instead of Calendar
throwing the usual party. JUL JUL JUL BROWSE

It was a way to show his gratitude for their hard work. 23 24 25

FRIDAY SATURDAY SUNDAY MORE
“Your contributions have made a tremendous impact to the growth of Orion, despite it
Rookery Bay: Free Fridays for 9 a.m.
being a challenging year,” Williams wrote.
Kids
Rookery Bay Environmental Learning
The bank had about 260 employees. Center

Michelle Tricca: "Exposures of 10 a.m.

Nine days before The five other directors of Orion Bancorp’s board – Earl the Mind"
Sidney & Berne Davis Art Center
Orion Bank closed Holland of Fort Myers, Brian Schmitt of Marathon, James
Torok of Sarasota, Alan Pratt of Vero Beach and James Treasures of the Atocha: 10 a.m.
“Our team is working Aultman of Marathon – were big investors in the holding Florida’s sunken treasure ship
through the credit cycle Lovers Key State Park
company. In the group, Holland had the most shares –
and doing a great job in
273,136 – making him the second-largest individual Free diabetes screening at 10 a.m.
this difficult economy and
shareholder after Williams. Sweetbay
current regulatory Sweetbay - Colonial Boulevard
environment,” he wrote in
an e-mail obtained by the Dave Wannstedt, a former coach of the Miami Dolphins All About Color opening 6 p.m.
Daily News. “The reception
and head football coach at the University of Pittsburgh,
Art League of Bonita Springs
economy has taken its owned 71,008 shares.
toll in all of the
communities where we do More Events »
Other recognizable investors from Naples include Michael
business, but Orion is
preparing to take Kessous, founder and president of M.K. Developers Inc.;
advantage of new retired Collier Circuit Judge Ted Brousseau; Collier
Find us on Social Media
opportunities. There are County Judge Eugene Turner, and Al Bateman, a
positive signs of recovery developer and president of Bateman Communities. News Alerts
in our communities.”

One investor, Michael M. Viechec Jr. of New York, had just Naples Daily News Fan Page
_ Memo from Jerry Headlines & updates from
one share registered under his name. naplesnews.com
Williams, CEO
Naples Daily News Facebook Application
“I had 10,186 shares and that was going to be my son’s Add this app to your Facebook profile
college education money,” said Luc Christian Mazzini, one
The Banner Fan Page
of the many disappointed investors from Naples. “I originally invested with Orion Bank, Follow The Banner on Facebook
which was called Gulf Coast National Bank, all the way back in 1996.”
The Collier Citizen Fan Page
Follow Collier Citizen on Facebook
After Orion received a cease-and-desist order in September from regulators to address
The Marco Eagle Fan Page

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7/23/2010 Records: CEO Jerry Williams, Dave Wa…
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its “unsafe and unsound practices,” Mazzini, a dentist, said he was reassured by a bank Follow The Marco Eagle on Facebook
executive that it was “no big deal.”
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Even as the bank’s finances worsened, Orion’s parent company was out trying to raise
more money from investors.
Business Directory
The company sold at least $25 million in stock last year, with the first sale reported on
Search Browse
June 24, according to a filing with the U.S. Securities and Exchange Commission. The
buyers aren’t disclosed in the filing. Business: e.g. salon

TMLS Heritage LLC, incorporated last June in Fort Lauderdale and managed by Mileto
Vincenzo, appears to be one of the latest investors. The company had 234,375 shares Location: e.g. Naples, FL

when Orion failed. Naples, FL

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Some investors remained private, registering their shares in the name of a depository
known as Cede & Co. Pow ered by Local.com

A trustee, Michael Polsky, has been appointed to liquidate Orion Bancorp’s assets. His
Miami attorney, Robert Schatzman, said he doesn’t expect shareholders to get any
money because there aren’t enough assets to sell to cover the millions owed to
creditors.

“Everybody who invested either through their pensions, or 401(k)s, or bought shares in
the private marketplace in the holding company lost money,” he said. “That money will
not be repaid.”

“I can’t conceive of an opportunity that would provide for a distribution to shareholders,”

Schatzman said.

That’s disappointing news to investors – big and small.

“I would like to get something. But I don’t think it’s going to happen,” said Leonard
Simons, an early investor from Miami.

Simons, 89, and his wife owned more than 8,000 shares in the holding company. Over
the years, they acquired more stock when they received shares instead of dividends.

The holding company’s books and records still are being

analyzed in the hunt for assets. Those already identified
include two bank buildings, a corporate jet, small
investments in other companies and cash in several bank
accounts, Schatzman said.

“We don’t even think there is going to be enough assets to

PHOTO BY MICHEL FORTIER
BUY THIS PHOTO »
pay off the first layers of debt,” he said.
Orion Bank is now gone,
closed by federal regulators The holding company had nearly $100 million in debt,
and reopened as IberiaBank.
Michel Fortier/Staff
which was used to help keep Orion Bank going as it
faltered on bad loans. Some of that borrowed money was
used to buy shares back from the open market to fund the
employee retirement plan, Schatzman said.

In February, M&I Bank won a $16.9 million judgment against Orion Bancorp for business
loans that weren’t paid back. Collateral for those loans included rights to the holding
company’s corporate jet.

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7/23/2010 Records: CEO Jerry Williams, Dave Wa…

M&I also had first priority security interest in all of Orion Bancorp’s deposit, operating
and other accounts.

FB Air Holdings Inc., an affiliate of Orion Bancorp, has filed for Chapter 11 bankruptcy
protection. It owns the corporate jet that Williams once used to fly around the state.

According to court records, the Piaggio Avanti P-180 business aircraft is valued at
nearly $3.8 million.

A balance sheet for FB Air, which still employs a pilot or two, shows it had total assets of
nearly $7.6 million on Oct. 31, 2009. All of its assets will be sold to help pay off creditors
of Orion Bancorp.

Like many banks locally and nationally, Orion was hit hard by bad loans. The bank lost
$75 million in the third quarter of last year before regulators swooped in to shut it down
on a Friday the 13th.

Orion had more than $250 million in non-performing construction and commercial loans,
which means borrowers weren’t making their payments.

Records show that it appears mismanagement also could have played a role in the
bank’s downfall.

Williams was ousted as the bank’s CEO days before regulators closed it.

He’s accused of lying to regulators and making the bank appear in better shape than it
was. In June of last year, regulators allege that he illegally loaned about $60 million to
“straw borrowers,” who were fronting for borrowers who already had hit their loan limit.

They say he knew $15 million from those loans would be used to buy stock in the bank’s
parent company and he lied about it to regulators.

According to regulators, the questionable loans also enabled the borrowers to buy
“certain low-quality assets” from Orion. The mystery borrowers never were identified.

Daniel Buhs, president and CEO of Vanderbilt Bay Construction Inc. in Naples, owned
17,371 shares in Orion.

“Jerry made some bad decisions in the last few years that took the bank down,” he said.
“He should have sold the bank a few years ago and we all would have walked away as
millionaires.”

Buhs was an early investor.

“My shares split several times and I never took any distributions,” he said. “It all went
back into stock.”

The bank chose to “do some very unwise loans with some pretty big numbers,” Buhs
said.

“I’m thoroughly disappointed, like all of us are. Jerry needs to be accountable for what he
has done,” he said.

Helmut Schroeder, a 69-year-old retiree in Estero, had 11,584 shares.

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He and his ex-wife invested $50,000 each in the bank. From 2005 to 2007, when Orion
was doing really well, the holding company paid out cash dividends, he said.

One year, Schroeder said, he got $15,000 to $16,000 in dividends, and another year he
got $10,000. So he ended up with about half of his money back.

At one time, he said, shares were valued at about $20. Now they’re down to zero.

“The people were always courteous and trustworthy and when they make money, hey you
believe in them,” Schroeder said.

Founded in 1977, Orion grew to become one of the most successful community banks in
the nation, ranking in the top 1 percent in the country for its performance in 2002.

Documents Before regulators closed the bank, it was hit with several
enforcement actions. The last, a cease-and-desist order,
Cease-and-desist called for Orion to increase its capital by no later than Nov.
order for Orion
Bancorp Inc. 20, 2009. The bank didn’t last that long.
Orion Bank Order _
Federal Reserve Bank
FDIC news release on Before Orion failed, Williams was a well-respected banker
Orion Bank
and community leader. He was named community banker
of the year by American Banker, a trade journal, in 2006.

In November, regulators swooped in to close Orion Bank. Williams was ousted from the
bank days before regulators closed it. No formal charges were brought.

In December, Williams put his 6-bedroom, 7-1/2 bathroom

estate in Grey Oaks up for sale. The selling price is
$6,499,000. The two-story home spans 8,384 square feet
and sits on 0.78 acres, according to the listing by Grey
Oaks Realty.
PHOTO BY MICHEL FORTIER
BUY THIS PHOTO »
IberiaBank, a publicly traded bank, took over Orion’s
The Grey Oaks home of Jerry
deposits and branches, but not its private shares
J. Williams, former CEO of
Orion bank which was taken
over by the FDIC due to
“Jerry was quite a salesman,” Schroeder said. “He not only
alleged mismanagement.
The home's value is listed at made things look good, he could prove it.”
$4 million plus. Michel
Fortier/Staff
In five years or so, Schroeder expected to have a “nice
sum to take out and enjoy” from his investment in Orion.
He doesn’t think that will happen now.

“I was hoping there might be a few bucks left for shareholders,” Schroeder said. “But it’s
doubtful.”

_ Connect with Laura Layden at www.naplesnews.com/staff/laura_layden.

© 2010 Naples Daily News. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.

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Comments » 8 Hide

April 17, 2010 chickendog writes:

6:38 p.m.
Never had these problems with Bush!

Suggest removal Sadd for the good folks-

Reply to this post Just sue! or call obamy.

April 17, 2010 Trexler writes:

7:09 p.m.
Plundering & stealing the money is only part of the equation,..all these noted
stockholders whom lost their ***, were just dupes and shill influence peddling
Suggest removal
in various network areas so that the bank could suck in more 'investors'..the
top 10% of mgt, directors should be charged criminally...just a bunch of bar
Reply to this post
skanks...all this has been going on most of the country,..Palmer may have
been the first here but the previous biggest was Naples Federal laundering
gold with the fat guy Beards..on Broad Ave South/financing coke runs, etc..ah, I
love Naples...every f****** door has a seedy story...mostly, where shall I start?

April 17, 2010 Davidh239 writes:

7:35 p.m.
His pep talks will come back to haunt him. It should be an open and shut case
of fraud.
Suggest removal

Reply to this post

April 18, 2010 Naples2003 writes:

8:06 a.m.
All the posters are on the right track. I am certain that fraud/criminal charges
will be brought against the CEO and others. It is just a matter of time for the
Suggest removal
case to reach a critical mass necessary for an indictment. The failure of Orion
was not simply due to the recession. Plenty of other banks failed in Florida and
Reply to this post
around the country. What sets Orion apart is that it had a CEO lying to the FED,
illegally lending money to straw borrowers and then having them "invest" a
portion of the cash in Orion stock, which he knew was or was soon to be
worthless. This has got to be criminal.(by the way where is the rest of that $60
mil?)
Also, the dozens of the LLCs he had set up with the same short list of
individuals listed as officers, for the sole purpose of selling foreclosed on
mortgages and LLCs were dissolved once a property was sold.
So... lets see here-Orion is indiscriminately lending money out to "commercial"
projects, the loans are NOT being repaid as the projects fail, as the money

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7/23/2010 Records: CEO Jerry Williams, Dave Wa…
should have not and was not lent out properly in the first place, the bank is
failing... Yet the CEO has all these LLC buying up properties/mortgages on the
cheap, and then selling them for a profit???

You tell me what all this is? It ain't that hard to connect the dots! There is so
much more come....

April 18, 2010 NaplesFly writes:

9:31 p.m.
in response to chickendog:

Suggest removal Never had these problems with Bush!

Reply to this post Sadd for the good folks-

Just sue! or call obamy.

Chicken shiz.....what the hell does Bush have to do with this? If anything, this is
a classic example of the real republican parties work. The republican party is in
place to protect corporate America and screw the common folk! They are smart
in that they have all the common folk fooled with the whole religious
conservative thing and they blindly march to the beat.....asking no questions
and looking no further than the propaganda that is spewed their way.

April 18, 2010 NaplesFly writes:

9:32 p.m.
I wonder if Jerry and Dave Wannstedt are still taking the corporate jet up to
Black Diamond for a round of golf? Ahhh....the good ol' days.
Suggest removal

Reply to this post

April 19, 2010 Elephanttamer writes:

8:30 a.m.
At least President Obama didn't have to do a FDR and call a "bank holiday" like
after the last big GOP fiasco in 1929.
Suggest removal

Reply to this post

April 19, 2010 goodview writes:

8:32 a.m.
"You gotta know when to hold em, know when fold them, know when to walk
away,know when to run"
Suggest removal
The stock market is legalized gambling. Loosing money is always a possibility
when gambling. I own stock and I watch whats going on with the companies I
Reply to this post
invest in. They didn't or atleast not enough. Hard lesson to learn. Real hard. If
laws were broken then those people need to be prosicuted to the fullest extent
of the law.

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