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FDIC Enforcement Decisions and Orders

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   [10,076] In the Matter of Alsip Bank and Trust, Alsip, Illinois and George B. Demes, Alexander Sarovich, Robert H. Murphy, George P. Fotopoulos, Herbert N. Rosen, and Louis T. Tenta, Docket No. FDIC-90–93b (5-24-90).

   Bank and Respondents to cease and desist from violating prior Cease and Desist Order.

   [.1] Officers and Directors—Indemnification—Independent Counsel
   [.2] Court Action Appeal—Dismissal
   [.3] Board of Directors—Resolution—Cease and Desist Order
   [.4] Management—Compensation/Bonuses—Nonpayment
   [.5] Officers—Sale of Interest—Holding Company
   [.6] Officers—Termination

In the Matter of

ALSIP BANK AND TRUST,
ALSIP, ILLINOIS
and
GEORGE B. DEMES, ALEXANDER
SAROVICH
, ROBERT H. MURPHY,
GEORGE P. FOTOPOULOS,
HERBERT N. ROSEN, AND LOUIS T.
TENTA
,
individually and as directors

(Insured State Nonmember Bank)
ORDER TO CEASE AND DESIST


   Alsip Bank and Trust, Alsip, Illinois ("Bank"), and George B. Demes, Alexander Sarovich, Robert H. Murphy, George P. Fotopoulos, Herbert N. Rosen, and Louis T. Tenta, as individuals, ("Respondents") having been advised of their right to a NOTICE OF CHARGES AND OF HEARING detailing the violations of an Order to Cease and Desist alleged to have been committed by the Bank and by them individually, and of their right to a hearing on such charges under section 8(b)(1) of the Federal Deposit Insurance Act ("Act"), 12 U.S.C. §1818(b)(1), and having waived those rights, entered into a STIPULATION AND CONSENT TO THE ISSUANCE OF AN ORDER TO CEASE AND DESIST ("CONSENT AGREEMENT"), with counsel for the Federal Deposit Insurance Corporation ("FDIC"), dated April 30, 1990, whereby, for the purpose of this proceeding, and without admitting or denying any violations of the Order to Cease and Desist, the Bank and the Respondents consented to the issuance of an ORDER TO CEASE AND DESIST ("ORDER") by the FDIC. The FDIC considered the matter and determined that it had reason to believe that the Bank and Respondents had engaged in violations of the Order to Cease and Desist. The FDIC, therefore, accepted the CONSENT AGREEMENT, and issued the following ORDER:

ORDER TO CEASE AND DESIST

   IT IS HEREBY ORDERED, that the Bank, its institution-affiliated parties, as that term is defined in section 3(u) of the Act, 12 U.S.C. §1813(u), its successors and assigns, and the individual Respondents cease and desist from violating the Order to Cease and Desist issued by the FDIC against the Bank on * * * and designated * * *.
   IT IS FURTHER ORDERED, that the Bank, its institution-affiliated parties, any successors and assigns thereof, and the individual Respondents, take affirmative action as follows:

   [.1] 1. Within 30 days of the effective date of this ORDER, the Bank shall engage
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independent counsel, acceptable to the Regional Director of the Chicago Regional Office of the FDIC ("Regional Director"), who shall make a determination of the indemnification of the officers and directors for attorneys fees and other expenses related to FDIC-89-184e; FDIC-89-185e; FDIC-89-186k; and FDIC-90-53k; in conformance with the statutes of the State of Illinois, and that the fees and expenses are not excessive in relationship to services performed.

   [.2] 2. Within 30 days of the effective date of this Order, the Bank shall dismiss its action in the United States Court of Appeals for the * * * Circuit, Docket No. * * *.

   [.3] 3. Within 30 days of the effective date of this ORDER, the Bank's board of directors shall adopt a resolution acknowledging the Order to Cease and Desist issued against the Bank by the FDIC, Docket No. * * *, and shall immediately take all steps necessary to comply with the Order to Cease and Desist.

   [.4] 4. The Bank shall pay no salary or expenses of Alexander Sarovich and George B. Demes accrued after April 30, 1990. In addition, no compensation or bonuses shall be paid to them beyond the base salaries previously established by the board of directors.
   5. The Bank shall obtain possession of Bank owned automobiles presently used by Alexander Sarovich and George B. Demes on or before April 30, 1990, or shall receive the fair market value of the automobiles. The terms and conditions of any purchases of the automobiles shall be acceptable to the Regional Director.

   [.5] 6. George B. Demes, Alexander Sarovich, and Robert H. Murphy shall take all steps necessary to sell their interests in Alsip Bancorporation, Inc. in a commercially reasonable manner, and to enter into a contract for the sale within 120 days of April 30, 1990. A report detailing the steps taken to market their interests shall be submitted to the Regional Director within 60 days and 90 days of April 30, 1990.

   [.6] 7. Robert H. Murphy shall cease to serve as an officer of the Bank within 120 days of April 30, 1990, and shall not serve as an officer or employer of the Bank or receive any compensation from the Bank after that date. He shall be allowed to receive the normal director's fee for each meeting of the board of directors actually attended, not to exceed $500 per meeting.
   The effective date of this ORDER shall be the date of its issuance by the FDIC.
   The provisions of this ORDER shall be binding upon the Bank, its institution-affiliated parties, any successors and assigns thereof, and the individual Respondents.
   The provisions of this ORDER shall remain effective and enforceable except to the extent that and until such time as any provisions of this ORDER shall have been modified, terminated, suspended, or set aside by the FDIC.
   Pursuant to delegated authority.

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