GREELEY — About 60 investors who sued former leaders of the failed New Frontier Bank for more than $6.5 million in losses plan to drop the lawsuit.
Real estate agent Carol D. Miller, who spearheaded the suit, said the decision came after the Federal Deposit Insurance Corp. told plaintiffs that they were unlikely to recoup any money.
The suit was filed in December against former bank president Larry Seastrom, six former board members and two other former bank officers, alleging they ignored warnings from regulators about unsound banking practices, profited from sweetheart deals, traded loans for investments in the bank and concentrated loans in volatile cyclical industries susceptible to market changes.
Insurance liability coverage for the Greeley bank’s former directors and officers lapsed when the bank went into receivership in April, so any potential award would have come from their personal assets. The FDIC is first in line to recover those assets. The Associated Press
