The federal trial of three executives of the failed BestBank took an unusual turn Tuesday as the judge dismissed the jury and said he would hear the case.
U.S. District Judge Richard Matsch dismissed the jury because of a health problem involving someone in the case other than the defendants, U.S. attorney spokesman Jeff Dorschner said.
Matsch postponed the trial and said it would continue without a jury at a date to be determined. The case stems from the 1998 failure of the Boulder- based bank, which cost the Federal Deposit Insurance Corp. nearly $200 million.
Matsch discussed his reasons for dismissing the jury privately with attorneys in court Tuesday and did not reveal whose health was at issue.
The defendants – Edward Mattar III, Thomas Alan Boyd and Jack Grace – each waived their right to a jury trial. The government objected, but Matsch accepted their waivers.
Regulators declared BestBank insolvent in July 1998 and closed the bank, even as Colorado’s economy was booming. It was the first bank default in the state in five years and one of the largest in the U.S. for a decade.
It lost more than $200 million, much of which was picked up by the FDIC. Large depositors lost $27 million.
The 10-week trial of Mattar, Boyd and Grace was in its seventh day. The government has presented three of 66 potential witnesses.
All attorneys for the prosecution and defense were in the courtroom Monday, according to a transcript. A juror was excused for medical reasons and was replaced by the first of three alternates, according to the court record.
Peter Bornstein, Mattar’s attorney, confirmed Dorschner’s account but said he could provide no additional details. Boyd’s attorney, Virginia Grady, and Grace’s lawyer, Daniel Sears, could not be reached for comment.
The case is being prosecuted by assistant U.S. attorneys John Haried and Michael Carey.
Mattar, Boyd and Grace each face 95 counts of conspiracy, fraud and other charges.
The government alleges that the former bank executives conspired to hide delinquent accounts to fraudulently inflate revenue and enrich themselves with millions of dollars in bonuses.
Their attorneys have blamed regulators for forcing BestBank to close when it was actually performing exceptionally.
Rather than forcing the bank to close, regulators should have taken a different path, such as asking the bank’s board of directors to deal with any regulatory concerns, the defense has argued.
BestBank issued credit cards to sub- prime borrowers at 18 percent interest.
Staff writer Greg Griffin can be reached at 303-820-1241 or ggriffin@denverpost.com.
