Bankruptcy judge asked to release First District AME
Howard Manly | 7/31/2013, 12:30 p.m.
On those documents, the First District claimed it had more than $23 million in cash and another $500 million in assets.
In addition, bank attorneys argue, the First District assured OneUnited officials that it would step up if its member church faltered. Its chief financial officer at the time, Clarence Fleming, wrote a memo to Amanda Feng, OneUnited’s vice president for asset management supporting this.
“As discussed with you today,” Fleming wrote on Feb. 9, 2009, “the First Episcopal District does not track loan guarantees. The reason is that our practice is to rescue any one of the churches that is troubled, for that reason, we view each church as having a built-in guarantee.”
None of that happened.
Bank attorneys blamed First District for allowing the loans to go bad and characterized their inactions as “bad faith” and undeserving of equity in the final bankruptcy decision.
“Evidence at trial,” bank attorneys wrote, “demonstrates that the First District submitted a financial statement to OneUnited that fraudulently and grossly misrepresented [its] assets. Additionally, since the fall of 2012, the Bishop of the First District has known of … Charles Street’s intentionally false financial disclosures yet failed to come forward or otherwise take any action.
“Finally,” bank attorneys concluded, “it bears repeating that a release constitutes nothing more than an attempt by the First District to exploit the bankruptcy remedy without submitting itself and all of its assets to the bankruptcy process. … It is manifest bad faith.”
Melvin B. Miller is on the board of OneUnited bank.