Gerry Anthony had already been forced out
of two other banks when he opened a third in May 2005.
The founding of Freedom Bank in Bradenton came with a stern warning from regulators: Grow slowly.
In just three years, Freedom became the largest community bank in Manatee County, with $290 million in assets. But its growth was tainted by a disregard for safe banking practices, according to state reports.
Regulators found that Anthony had implemented an incentive program that rewarded officers for lending large sums of money — even if that money was never repaid. A whistle-blower later claimed in a lawsuit that Freedom Bank supervisors pressured employees to doctor financial reports in order to hide problem loans from regulators.
Anthony had been forced by stockholders to resign from past jobs at Bradenton's American Bank in 1999 and Coast Bank in 2004 — because his "rapid growth strategy" had resulted in problem loans and flagging profits, news reports show.
Now, the same thing was happening at Freedom Bank just three years after its opening. By July 2008, nearly 30 borrowers had defaulted on a total of $27 million.
One loan, for $2.9 million, went to a company partly owned by Marvin Slovacek, a developer who filed for bankruptcy protection on behalf of one of his firms four years earlier.
When state examiners confronted Anthony and Freedom's board of directors about the need to scale back, Freedom's leaders became "argumentative" and blamed a weakening economy for the bank's ills.
Eight months before the bank finally collapsed, senior lender Mark S. Williams complained in a lawsuit that Anthony and other officials bank had entered data into financial statements to make the institution look healthier than it was.
Williams said Freedom needed to write down $11 million in bad loans, but Anthony and other board members would write down just $4 million.
Before Williams quit, he had a "heated" exchange with Anthony and was criticized for not being a "team player," the suit says.
Anthony and Freedom never acknowledged or denied the charges in court documents. They simply pressed for the matter to be settled through arbitration.
When the Federal Deposit Insurance Corp. closed Freedom in October 2008, the federal government essentially took over as the defendant in the case.
The case remains open, the last entry in September 2009.
Anthony did not return three calls seeking comment.