Magazine article American Banker

Investor Suing Barnett over Fla. Development Deal

Magazine article American Banker

Investor Suing Barnett over Fla. Development Deal

Article excerpt

A West Coast lender is suing Barnett Banks, which it claims defrauded it in a complex conspiracy that involved payoffs to bank officials.

Lawyers for Portland, Ore.-based Pacific Harbor Capital said Barnett Bank of Lee County, Fla., lent money to customers who were engaged in drug trafficking and money laundering and then involved Pacific Harbor.

Barnett Bank of Lee County was rolled into Barnett's lead bank last year.

In the late 1980s, Pacific Harbor participated with Barnett in financing a Fort Myers, Fla., country club and housing development called Fiddlesticks. The lawsuit alleges that Barnett officials misled Pacific Harbor about many aspects of the deal. Pacific Harbor lost money but the Barnett officials were rewarded with cash and property, the suit claims.

Pacific Harbor is seeking $13.2 million in compensatory damages and $25 million in punitive damages in the suit, filed in February in U.S. District Court in Portland, Ore.

In recent years the Fort Myers area has been rocked by scandals involving prominent businesspeople, land deals, drug smuggling, and money laundering. Some Barnett customers and former officials have been caught up in the criminal investigations.

Barnett said Pacific Harbor's attempt to tie criminal activities in the area to the Lee County bank's lending operations is unfounded.

Robert Puterbaugh, an attorney representing Barnett, said: "There have been so many allegations thrown out it's surprising that someone hasn't alleged that a Barnett official was in Dallas on Nov. 22, 1963, and participated in a conspiracy to kill the President."

The allegations of a criminal link are "nonsense," he added. …

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