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[¶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 SuspensionProhibition FromParticipation 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.