An occasional roundup of news in the No. 2 bank town.Fired worker sues the former Golden West
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A former employee in California sued the former Golden West Financial Corp. on Wednesday, saying he was wrongfully fired in 2006 because he planned to warn Charlotte-based Wachovia Corp. against buying the mortgage lender. Wachovia acquired California-based Golden West, which also operated under the World Savings name, that same year.
Paul Bishop, who worked in San Francisco for World Savings from 2002 until he was fired, accuses World Savings brokers and contractors of predatory lending. Bishop claims that brokers inflated borrowers' incomes to qualify them for mortgages they couldn't afford, failed to explain the risks of adjustable-rate and interest-only mortgages to borrowers, and targeted minority borrowers. If borrowers expressed concerns about their mortgage terms, the lawsuit says, “brokers were trained to sidestep the concern by emphasizing how much the borrower's home value had increased.”
Bishop says he talked to multiple managers about his concerns but was repeatedly brushed off. After Wachovia announced its intention to buy Golden West in early May 2006, Bishop says he “realized that Wachovia was buying a ticking time bomb” and told a manager that he planned to call Wachovia's chief financial officer. Bishop was fired shortly afterward. He claims his termination was connected to the incident.
Wachovia spokeswoman Christy Phillips-Brown said the bank will seek to dismiss the lawsuit. “Wachovia strongly believes this case is without legal and factual merit,” she said.
“Wachovia and World Savings have strong policies and procedures to make sure all employees follow applicable laws,” she added.
Wachovia bought Golden West for $24 billion. Christina Rexrode
First Citizens expands in north Mecklenburg
First Citizens BancShares Inc. on Tuesday opened its second Huntersville office, at 14221 Boren St. near Gilead Road. The Raleigh-based bank now has about two dozen offices in the Charlotte area.
Bank executive Marc Horgan noted the new north Mecklenburg location's proximity to Interstate 77.
First Citizens, with assets of $16.7 billion, had first-quarter earnings of $32 million, up 12 percent over the previous year. Christina Rexrode
Wachovia brokerage unit loses chairman
Wachovia Corp. confirmed that Robert Bagby retired this month as chairman of its St. Louis-based brokerage unit. He joined the company after last year's acquisition of A.G. Edwards Inc. Danny Ludeman, a Wachovia veteran, remains chief executive of the unit. rick rothacker
Brookwood consults on Beverage-Air purchase
Charlotte investment bank Brookwood Associates advised ALI SpA, an Italian foodservice equipment company, on its purchase of Beverage-Air, which has operations in Spartanburg. rick rothacker