The former head of the Martha’s Vineyard Savings Bank, who left last year under circumstances that were never fully explained and now has been permanently barred from banking by federal regulators, said in a statement this week that the allegations against him by the Federal Deposit Insurance Corporation are unfounded and without substance.
The former head of the Martha’s Vineyard Savings Bank, who left last year under circumstances that were never fully explained and now has been permanently barred from banking by federal regulators, said in a statement this week that the allegations against him by the Federal Deposit Insurance Corporation are unfounded and without substance. In a written statement, Christopher Wells said the bank suffered no harm or losses during his eight-year tenure as president and chief executive officer, and that he did not use his position for personal gain. “The bank did not lose a single penny as a result of any of the allegations against me,” Mr. Wells said in the statement provided exclusively to the Gazette. “Similarly, the bank is not threatened with any kind of loss today as a result of any of the unfounded allegations made by the FDIC and there was no activity for personal gain,” he wrote.
In what is termed an “order of prohibition from further participation,” the FDIC two months ago barred Mr. Wells from the banking profession. The order contains allegations that Mr. Wells had “engaged or participated in violations of law and/or regulations, unsafe or unsound banking practices, and/or breaches of fiduciary duty . . .” The order also said the FDIC believed that the bank “has suffered or will probably suffer financial loss or other damage,” and it said “violations, practices and/or breaches of fiduciary duty involve personal dishonesty . . .”
The order was issued in late February and made public by the FDIC last week.
In lay terms, the order is an agreement between Mr. Wells and the FDIC in which he waives his right to contest the allegations. He has admitted no wrongdoing and has not been fined, a spokesman for the FDIC confirmed yesterday.
“We don’t comment on the orders specifically. In general I can tell you that an order means he is no longer able to participate in banking of an FDIC institution. In order to do that he would need to apply for permission,” FDIC spokesman LaJuan Williams-Young told the Gazette Thursday.
Mr. Wells was president and chief executive officer at the bank for eight years, beginning in 2004 when he took the helm at what was then the Dukes County Savings Bank. A well-regarded community banker, he presided over a period of growth and prosperity at the Island’s largest bank, including the 2007 merger of the savings bank with the Martha’s Vineyard Cooperative Bank.
In May 2012, Mr. Wells resigned abruptly. His departure was not explained by leaders on the bank board of trustees, but the Gazette learned later that the bank was under investigation by the FDIC and had received a letter that among other things cited the board of trustees for poor leadership and oversight, and downgraded the bank’s composite rating. In an interview with the Gazette late last year, bank leaders acknowledged that the bank had been flagged by federal regulators for problems, although they could only describe them in the broadest terms because they were bound by rules of confidentiality.
Of prohibition orders such as the one involving Mr. Wells, Ms. Williams-Young said: “They are not unusual. This is one of our tools we use . . . I look at it as a cooperative agreement.” Beyond that, she said “it is up to Mr. Wells” to speak about the prohibition order.
In his statement to the Gazette, Mr. Wells said he did not know why he was targeted by FDIC bank examiners.
“During spring 2012, FDIC bank examiners engaged in what I believe was a personal vendetta against me (for reasons I will probably never know or understand), and made numerous allegations that were unsubstantiated and unfounded,” he wrote.
Mr. Wells defended his leadership at the bank and praised the “many terrific people” who work there. He said he decided to resign out of concern for the integrity of the institution, and decided not to contest the FDIC allegations to avoid a costly, drawn-out legal battle.
“I made the decision to resign from the bank so it could continue serving its community without the distraction of any claims,” Mr. Wells wrote. “I subsequently realized, however, that defending against the FDIC allegations would be extremely time-consuming and prohibitively expensive against a federal government agency with endless resources. I therefore made the difficult decision that the better course of action for me was to acknowledge the practical impossibility of engaging in an unwinnable fight, and simply move on with my life by agreeing to disagree in an order made public last month. Caring for my family is far more important.”
Six months ago the bank named Paul Falvey, a community banker from Hingham, as president and CEO. In an interview with the Gazette this week about the bank’s financial position, restructuring and personnel changes, Mr. Falvey said he could not comment on the prohibition order, citing rule 309 of the FDIC code. “That’s between Chris and the FDIC,” he said.
The full text of Mr. Wells’s statement follows:
“I had a wonderful experience working with many terrific people at Martha’s Vineyard Savings Bank. During my tenure as president, we expanded the bank’s deposit base twofold; increased our lending activities significantly to local individuals and businesses with minimal losses; and grew capital to more than twice the federal requirements to be considered ‘a well capitalized bank.’ My goal was to ensure that Vineyarders would always have a financially strong and independent bank serving and supporting the people of the Island and surrounding areas.
“During my eight years at the bank, Martha’s Vineyard Savings Bank developed a reputation as one of the most financially sound banking institutions in the country. We had three successful federal and state exams; underwent numerous and frequent independent audits and loan reviews by reputable companies; and were positioned to provide jobs and resources to the hardworking people of Martha’s Vineyard for years to come.
“During spring 2012, FDIC bank examiners engaged in what I believe was a personal vendetta against me (for reasons I will probably never know or understand), and made numerous allegations that were unsubstantiated and unfounded. I made the decision to resign from the bank so it could continue serving its community without the distraction of any claims. I subsequently realized, however, that defending against the FDIC allegations would be extremely time-consuming and prohibitively expensive against a federal government agency with endless resources. I therefore made the difficult decision that the better course of action for me was to acknowledge the practical impossibility of engaging in an unwinnable fight, and simply move on with my life by agreeing to disagree in an order made public last month. Caring for my family is far more important. There was no admission of wrongdoing, no losses to the bank or any individual, no personal gain to me, and no penalties imposed.
“There is also no disagreement of the following indisputable fact, namely, the bank did not lose a single penny as a result of any of the allegations against me. Similarly, the bank is not threatened with any kind of loss today as a result of any of the unfounded allegations made by the FDIC and there was no activity for personal gain. In the final analysis, therefore, while I am disappointed in having to leave the bank under circumstances totally beyond my control, I am nevertheless very proud of what we accomplished during my tenure as president.”

Comments
If he was indeed innocent,
conerned tisburyIf he was indeed innocent, why would it be a "unwinnable fight" for him? I also loved the statement about providing jobs to the Island. I have seen how many of their employees commute each day. So all that money they make is not supporting island businesses but going off island to support off island businesses. I am concerned wrote on the times that they have to go off island to find talent and experience, but for years these banks survived without their off island arrogance. Apparently, the college educated people off island are somehow smarter then the college educated islanders. As far as experience, who gave them their so called experience? Someone that gave them a chance. This person also states the banks income for three years and write offs. I have to think the person making these statements works at MVSB. I noticed about a million less made between 2011 and 2012. This banker said its because of falling interest rates. But if interest rates r so low, and our return on our deposits are basically non existent, the bank should not have lost close to a million in revenue. Perhaps if they weren't selling all their loans the income would.be higher. I can only wonder if the Fdic.imposed some type if financial penalty. And lastly, its easy to grow a bank when you do a merger with another bank. I do hope one day the real full truth will come to light.
Not everyone has millions of
Realist EdgartownNot everyone has millions of dollars to defend themselves against the government. Read the article on this link: http://www.truthinjustice.org/bankonfear.htm
If the link doesn't work, google "Banking on Fear" and "Glen Garrett"
As an aside, why do you think the regulators haven't gone after the big banks and their executives earning millions of dollars every year,who caused the financial crisis and caused tens of thousands of families to lose their homes and their livelihood? The banking agencies are funded by bank assessments and insurance premiums, and the income earned on the reserves they fund. Ultimately, the money comes from the bank customer and taxpayer. The regulators don't have the expertise and resources to go up against Bank of America, Citibank, Wells-Fargo, etc. So they focus their strong-arm tactics to reak havoc on community banks and bankers, and the communities they serve.
And Sir, if you look at the bank's financial reports you will see that net interest income fell almost $1.3 million between 2011 and 2012. Net interest income is the difference between interest income on loans and investments and the interest expense on deposits and money the bank borrows. This bank is no different than other banks. Just compare them to Edgartown National or the Cape banks.
Thanks for bringing up the
David Off island for nowThanks for bringing up the real story, that the big banks are too big to fail and too big to prosecute. The punishment that the guys at the big banks should have been jail time plus huge fines plus being banned from banking. We could only hope.
dear concerned, i just wanted
dear concerned tisburydear concerned, i just wanted to reply that there are a majority of bank employees that live on island and while it may seem that there are more and more commuters on the boat these days, you need to check your "facts" - as i see it, a lot of islanders are moving off to the mainland where the cost of living is cheaper. and they commute to island jobs, for the town, for the bank, insurance companies, etc. i don't beleve off island people were sought for job openings, but rather positions go out to in-house employees first before an ad is placed to the public. i believe most companies practice this(?) also, i have to take issue with the fact that employees of the bank or any other island business that hires off island residents means that their employees are not supporting the island economy. many of them do - they are often the ones shopping in island stores, buying lunches and dinners in town and attending on island events. while most islanders i know take regular trips off to the mall, BJs and gas up their cars on the mainland whenever they can. not to mention the island residents who wire thousands of dollars every day that they've made on island to other countries. most of the island businesses are owned by non-residents anyway, who certainly take their earnings back home to wherever. you must know all this is true. i'm just saying it's a different island.
i agree with the rest you had to say. guess we'll have to wait for the truth to come out or maybe we'll never know. i do like supporting island businesses when i can though.
Let me get this straight, you
Not Fooled Oak BluffsLet me get this straight, you have walked away from your profession, plaques and certificates in hand, barred from being employed in your chosen profession with any bank associated with the FDIC, and your response is basically that you and the FDIC simply agree to disagree. Really?
And so it goes .......
Jane Chittick Edgartown and Washington DCAnd so it goes .......
How many island "professionals" (real estate, bankers other than Christopher Wells, insurance, and too many attorneys) did/do I still personally know on a first-name basis? I don't have enough fingers and toes to count on.
How about Patrick Manning
Jack EDGHow about Patrick Manning another great story. The Island housing director that we were so lucky to have. The Island housing and director Mr hopkins will not talk about it... Sam old story just different players.
The Island housing will not
Patty OBThe Island housing will not dicuss matters about Mr Manning because there worried he will talk... Plain and simple. Mr Hopkins and Island housing needs to be more transparent. There only concern is how it will effect sponspors and donations.. to pay there crazy full time salaries for part time work.
I am happy to answer or speak
Ewell Hopkins Oak BluffsI am happy to answer or speak to any concerns you have as they pertain to the Martha's Vineyard Housing Fund. In most cases I will reference my comments already reported on in this paper. If there are still outstanding questions I will be happy to answer those as well.
Please let me know your concerns, I truly want to support a more transparent process.
One question; FaceBook, this comment section or another social media outlet... what's the best forum for this conversation?
He did a great job of
Patches Oak BluffsHe did a great job of explaining. The auditors had a personal vendetta. He was right and did no wrong, but decided to toss his career away rather than defend himself.
Why do I still think we're not getting the truth. I think they are playing it cozy so there won't be a run on the bank.
The customers deserve an honest answer.
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