Century Bank

Defaults: This data is from judgements and foreclosure filings and was collected through county clerk’s offices. It includes every judgement for more than $1 million or the five largest at each bank.
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Century Bank
April 1985-November 2009



$728 million

$283 million

Barry M. Florescue
John P. O'Neill
Charles M. Miersch
Stanley Kreitman
James M. Nickerson
One was a corporate raider sentenced to four years in federal prison for securities fraud.

Another was a luxury home builder from Ohio who would later get 22 years in prison for tax evasion and mortgage fraud.

A third borrowed money two months after filing for bankruptcy protection in Arizona, while a fourth would be indicted and accused of selling millions of prescription pills on the Internet.

Each was a customer of Sarasota's Century Bank who received millions of dollars in loans.

None of them paid it back.

Even as the economy began to deteriorate in 2006, Century continued making dangerous loans, leading to its collapse in November 2009. The FDIC has since sued four directors and chief executive John P. O'Neill, alleging gross negligence.

An attorney for O'Neill would not comment.

The officers and directors named in the suit have filed a motion to have it dismissed, claiming it was the economy, not mismanagement, that caused the bank to fail.

Century was founded in 1985 and purchased in 1989 by Barry Florescue, a Wall Street investor who now lives in Palm Beach and is, along with his girlfriend, an important figure on the charity gala circuit there.

In 1996, regulators called out the bank for showering Florescue with loans and other perks.

The Office of Thrift Supervision charged Florescue with paying himself a salary and directors' fees before he earned them, and setting up a $100,000 line of credit with rates and terms more favorable than those available to the public.

As punishment, the OTS forced Florescue to pay $81,000 and barred him from serving as an officer of the bank.

O'Neill took over in 2001 and increased Century's assets from $300 million to $920 million in six years. But instead of slowing down when the real estate market softened in 2006, Century accelerated. It continued making large loans to developers — even as regulators warned that the bank was ignoring the most basic underwriting principles.

For example, the FDIC said Century did not analyze financial information to make sure borrowers had enough liquid assets — basically cash on hand — to pay bills. The bank also ignored unfavorable appraisals and lent more to individual borrowers than its policies allowed.

Sometimes, the FDIC said, Century approved loans to borrowers of "known questionable honesty."

Consider the case of Paul Bilzerian, a convicted felon who received $6.25 million through a related company in December 2006, using his 28,000-square-foot Tampa mansion as collateral. By then, Florida housing prices were down almost 15 percent.

Melody Shimmell, the bank's former internal fraud investigator, openly questioned the deal.

"I went to the CFO and asked him whether you have to be a convicted felon before you can get a loan like that," Shimmell said. 

Still, Century forged ahead.

It lent Ohio builder Thomas Parenteau $12 million in January 2007 to refinance loans on his 36,000-square-foot mansion near Columbus. Parenteau defaulted and was sentenced in August 2011 to federal prison for conspiring to defraud banks by artificially inflating the value of homes that he bought and sold.

Century also provided real estate developer James Bovino with $9 million in late 2006 to develop 273 acres in Ellenton.

By January 2008, Bovino had stopped making payments. But instead of foreclosing, Century gave him an extra $280,000, the FDIC found.

Bovino later sent Century a string of bounced and uncashed checks totaling more than $800,000. And still Century gave Bovino more money.

It even handed him $641,000 in September 2008 — two months after his real estate companies had filed for bankruptcy in Arizona.

Michael Arnold, meanwhile, received $5.4 million from Century in late 2006 despite having filed for bankruptcy protection in December 2002. At the same time, federal agents say they were investigating Arnold in connection with allegations that he illegally sold prescription drugs online and laundered the proceeds through real estate ventures.

Regulators hit Century with a "cease and desist" order in March 2009, prompting a bristling response from O'Neill: "We are not going to lie down and roll over. We've never had safety problems. Our problems are a function of the economy."

Not so, regulators later concluded.

In particular, they raised questions about one deal, with New York investor and money manager William Landberg.

In August 2008, Landberg borrowed nearly $6.16 million to develop a pair of lots on Long Island. The developer was friendly with the bank's founder, Florescue, and a director, Stanley Kreitman.

Both men were investors in a fund Landberg controlled.

By February 2009 — with Century already in deep financial trouble — the bank lent Landberg another $10 million. O'Neill, the bank CEO, and an unnamed director had misgivings about the loans, but did not try to stop them, the FDIC said.

The FDIC concluded that the money was used to fund a Ponzi scheme, a crime to which Landberg pleaded guilty in November 2011. He was sentenced to 42 months and ordered to forfeit $8.7 million.

"In approving these two transactions, the defendants gave away $10 million to Landberg when the bank did not have the money to lend and when Florescue and Kreitman had significant funds invested with Landberg," the FDIC lawsuit says.

The case remains pending.

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