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{{10-31-00 p.C-2963}}

[10,701A] In the Matter of Ronald L. Blunt, and Byron Dougherty, Midland Bank, Kansas City, Missouri, Docket No. 92-359g (1-5-93)

   Respondent prohibited from participating in the conduct of affairs of, or exercising voting rights in, any insured institution without the prior written approval of the FDIC.

   [.1] Prohibition, Removal or Suspension—Prohibition From—Participation in Conduct of Affairs

In the Matter of
RONALD L. BLUNT and
BYRON DOUGHERTY,
as institution-affiliated parties of
MIDLAND BANK
KANSAS CITY, MISSOURI
and
MIDLAND BANK OF KANSAS
MISSION, KANSAS
(Insured State Nonmember Banks)
NOTICE AND ORDER OF SUSPENSION AND PROHIBITION

FDIC-92-359g

   It appears to the Federal Deposit Insurance Corporation ("FDIC") that Ronald L. Blunt ("Respondent Blunt"), an institution-affiliated party of Midland Bank, Kansas City, Missouri ("Midland-Missouri"), in his capacities as chairman of the board of directors and president and chief executive officer of Midland-Missouri, and an institution-affiliated party of Midland Bank of Kansas, Mission, Kansas ("Midland-Kansas") (Midland-Kansas and Midland-Missouri sometimes collectively referred to as "Banks"), in his capacity as chairman of the board of directors of Midland-Kansas, and that Byron Dougherty ("Respondent Dougherty"), an institution-affiliated party of Midland-Missouri, in his capacity as chief financial officer of Midland-Missouri, and an institution-affiliated party of Midland-Kansas by reason of his participation in the affairs of Midland-Kansas (Respondent Blunt and Respondent Dougherty sometimes collectively referred to as "Respondents"), have been charged in an indictment filed on or about November 5, 1992, by a Grand Jury in the United States District Court for the Western
{{10-31-00 p.C-2964}} District of Missouri, Western Division, Case Number 92-00199-01/02-CR-W-8, with the commission of, or participation in, crimes involving dishonesty or breach of trust punishable by imprisonment for a term exceeding one year, in that each Respondent was charged with: (a) one count of conspiracy to make false entries in bank records, reports, and statements, and misapply bank funds, in violation of 18 U.S.C. § 371; (b) one count of making false entries in bank records, reports, and statements, in violation of 18 U.S.C. §§ 1005 and 2; and (c) one count of misapplication of bank funds, in violation of 18 U.S.C. §§ 656 and 2.

   It further appears that these charges all relate to the alleged actions by the Respondents in connection with the employment of an individual from December 1991 through September 1992 as a personal nanny or child care provider for Respondent Blunt's preschool-age daughter at Blunt's personal residence. The charges allege that Respondents knowingly and willfully caused Midland-Missouri to pay approximately $10,150 in salary to this child-care provider, and caused records, reports, and statements of Midland-Missouri to reflect this payment as payment for services as a bookkeeping assistant at Midland-Missouri and was done so with the intent to conceal the true nature of that individual's employment from FDIC bank examiners, and that Respondents knowingly and intentionally conspired together, and possibly with others, to cause these actions to occur.

   It further appears that continued participation in the conduct of the affairs of Midland-Missouri or Midland-Kansas by either Respondent may pose a threat to the interests of the depositors of both of these Banks and may threaten to impair public confidence in these Banks.

   After due consideration and resolution:

   [.1] IT IS HEREBY ORDERED, pursuant to the provisions of section 8(g)(1) of the Federal Deposit Insurance Act ("Act"), 12 U.S.C. § 1818(g)(1), that the Respondents be, and hereby are, suspended and prohibited from further participation in any manner in the conduct of the affairs of Midland-Missouri and/or Midland-Kansas.

   Pursuant to the provisions of 8(g)(3) of the Act, 12 U.S.C. § 1818(g)(3), within 30 days from service of this NOTICE AND ORDER OF SUSPENSION AND PROHIBITION ("NOTICE"), Respondents may request in writing an opportunity to appear before the FDIC to show that their respective continued service to or participation in the conduct of the affairs of these Banks does not, or is not likely to, pose a threat to the interests of the depositors of these Banks or threaten to impair public confidence in these Banks. Upon receipt of such a request, the FDIC will fix a time and place for a hearing not later than 30 days from receipt of the request. The hearing will be conducted in the manner prescribed in section 8(g)(3) of the Act, 12 U.S.C. § 1818(g)(3), and section 308.164 of the FDIC Rules of Practice and Procedure, 12 C.F.R. § 308.164.

   An original and one copy of all papers filed in this proceeding shall be served upon the FDIC's Office of the Executive Secretary, 550 17th Street, N.W., Washington, D.C. 20429. Copies of all papers filed in this proceeding shall be served upon Arthur L. Beamon, Associate General Counsel, Compliance and Enforcement Section, 550 17th Street, N.W., Washington, D.C. 20429, and upon Gerald F. Lamberti, Regional Counsel (Supervision), Kansas City Regional Office, 2345 Grand Avenue, Suite 1500, Kansas City, Missouri 64108.

   The provisions of this NOTICE shall become effective upon service of this NOTICE, and shall remain effective until terminated by the FDIC or until the final disposition of the said indictment.

   By direction of the Board of Directors.

   Dated at Washington, D.C., this 5th day of January, 1993.

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