{"id":5196,"date":"2011-06-30T00:00:00","date_gmt":"2011-06-30T05:00:00","guid":{"rendered":"https:\/\/institutionalinvestorsecuritiesblog.blawgcloud.com\/2011\/06\/sonoma_valley_bank_shareholder"},"modified":"2022-04-05T11:20:16","modified_gmt":"2022-04-05T16:20:16","slug":"sonoma-valley-bank-shareholder","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/sonoma-valley-bank-shareholder\/","title":{"rendered":"Sonoma Valley Bank Shareholders File Both a Class Action Lawsuit and An Insurance Claim Seeking to Recoup Millions"},"content":{"rendered":"

Sonoma Valley Bank shareholders have submitted a class action complaint accusing the financial institution\u2019s chief financial officer, chief executive officer, and six corporate directors of mismanaging over $40 million in loans. The plaintiffs are placing most of the blame for this alleged financial negligence<\/a>, and the bank\u2019s collapse, on bank CEO Sean Cutting.<\/p>\n

The class action complaint will cover any shareholder (except for the defendants) that owned shares in the bank as of August 25, 2010. Shareholders, most of them from Sonoma Valley, saw their stock drip in price from $31\/share in 2007 to under a penny in 2010 when the bank was seized. $71 million was lost and the federal government says it lost $20 million because of the closure.<\/p>\n

Per the class action complaint, the bank\u2019s demise can be attributed in great part to the approval of loans worth over $40 million to Marin County developer Bijan Madjlessi\u2019s companies and his business partners. Some $35 million in loans were never paid back. State regulators have arrested Madjlessi for alleged insurance fraud. He pleaded not guilty to felony insurance fraud.<\/p>\n

Shareholders also recently filed an insurance claim with Progressive Casualty Insurance Co. seeking to recover $20 million in equity that they lost when the financial institution collapsed. Under the insurance policy, some $20 million is designated to protect the leadership of the bank from such a lawsuit as the one that was just filed.<\/p>\n

\u201cMany people have asked: Where are the convictions over the financial mess? Finally, someone goes to jail, but who\u2019s heard of Colonial BankGroup? I guess it was just not too big to fail,” says Shepherd Smith Edwards and Kantas founder and stockbroker fraud lawyer William Shepherd<\/a>.<\/p>\n


\nRelated Web Resources: <\/strong>
\nSonoma Valley Bank shareholders file lawsuit blaming CEO<\/a>, PressDemocrat.com, June 29, 2011<\/p>\n


\nMore Blog Posts:<\/strong>
\nBank of America Cop. (BAC)\u2019s Merrill Lynch a Defendant of Class-Action Mortgage-Backed Securities Lawsuit Against at Least 1,800 Investors<\/a>, Institutional Investors Securities Blog, June 25, 2011<\/p>\n

Class Members of Charles Schwab Corporation Securities Litigation Can Still Opt Out to File Individual Securities Claim,<\/a> Stockbroker Fraud Blog, December 6, 2010<\/p>\n

Class Action Securities Fraud Lawsuit Accuses SEC of Gross Negligence Related to Bernard Madoff Ponzi Scam<\/a>, Institutional Investors Securities Blog, November 23, 2010<\/p>\n

Continue Reading \u203a<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Sonoma Valley Bank shareholders have submitted a class action complaint accusing the financial institution\u2019s chief financial officer, chief executive officer, and six corporate directors of mismanaging over $40 million in loans. The plaintiffs are placing most of the blame for this alleged financial negligence, and the bank\u2019s collapse, on bank CEO Sean Cutting. The class […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3804],"tags":[],"class_list":["post-5196","post","type-post","status-publish","format-standard","hentry","category-class-action-lawsuits"],"yoast_head":"\nSonoma Valley Bank Shareholders File Both a Class Action Lawsuit and An Insurance Claim Seeking to Recoup Millions — Investor Lawyers Blog — June 30, 2011<\/title>\n<meta name=\"description\" content=\"Sonoma Valley Bank shareholders have submitted a class action complaint accusing the financial institution\u2019s chief financial officer, chief executive — June 30, 2011\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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