US Century Bank: barely floating with $1.6 billion in deposits ... by gimleteye

In a just world there would be a trial of US Century Bank and its founders in Miami, Florida, who were just slapped with what might be one of the harshest, if not the harshest, consent orders in US banking history. And if there were a trial the insiders who used US Century as their piggy bank would also be called to account for turning a federally chartered institution into a political apparatus to control the local levers of power governing zoning and permitting in farming and wetlands. But it is not a just world, is it?

The closest view the public may ever have of justice is the federal Consent Order slapped on US Century, its officers and directors by the FDIC (Federal Deposit Insurance Corporation) with its pale disclaimer: "(US Century Bank) has consented, without admitting or denying any charges of unsafe or unsound banking practices or violations of law or regulation related to weaknesses in asset quality, management, earnings, capital, liquidity, and sensitivity to market risk, to the issuance of this Consent order by the FDIC and OFR (Florida Office of Financial Regulation)."

US Century Bank was the late manifestation of the empire, now vastly reduced, of uber lobbyist Sergio Pino. It started as a simple plumbing supply business and leap-frogged to vertical integration with mass produced housing; a local aspirant to Lennar, one of the nation's largest homebuilders whose fortunes were built from mass production housing in the former Everglades. Pino's chief lieutenants, Ramon Rasco, Rodney Barreto, Jose Cancela, Armando Guerra, and others; built fortunes from the ring suburbs, growing like a toxic culture in a petri dish. For the model to work, the builders required minimum friction and speed in execution; that meant quick zoning to provide housing and supermarkets and strip malls, and then financing and connections to off-load commercial and residential mortgages. Unlike Jorge Mas Canosa, whose corporate empire was built on county road contracts and a highly public persona, the growth of US Century Bank started in the chamber and hallways of the county commission but the main operators retreated from view and hid within boards of lobbyist associations like the Latin Builders and South Florida Builders. They erected legislative turnstiles and gates barring the public from seeing how the worst economic bust since the Great Depression was built into the model.

Unless there is a forensic audit of US Century Bank that reaches the public, we will never know the exact details (and The Miami Herald, whose leadership was complicit in its own way with the downtown power structure, lawyers, and lobbyists for the housing boom will not be of much help except to provide facts without context or commentary.) But we can imagine both the just world and the trial.

The deposed witnesses would include every elected official who counted on the builders and developers in South Florida for campaign contributions that tie back to US Century Bank. Their votes on the Urban Development Boundary and infrastructure serving the bleak suburbs of Miami-Dade County (like those surrounding Tamiami Airport or Homestead Air Force Base) were oaths of allegiance to the speculators and thieves who claimed to be delivering "what the market wants" while fattening their bank accounts. Their defense: "there is no crime playing the system better than our opposition."

The witness list would include former Miami-Dade Mayors and their county managers; Alex Penelas, Armando Vidal, and Steve Shiver, Carlos Alvarez, former county commissioners Barbara Carey Shuler and Carrie Meek, Miguel Diaz de la Portilla, Jimmy Morales, recalled commissioner Natacha Seijas, her ex chief-of-staff Terry Murphy, sitting commissioners Joe Martinez, Javier Souto, Pepe Diaz and Dennis Moss, Barbara Jordan and Audrey Edmunson and the phalanx of political consultants who serve them including Armando Guttierez. It would also include past and county department heads; John Renfrow, Miami Dade Water and Sewer, Bill Brandt, and former DERM chief Carlos Espinosa. By taking apart the insider dealing and political operations of US Century Bank, the trial would expose how $7 billion in infrastructure deficits accumulated; how those deficits served the business of bankers and developers and how Chamber of Commerce values ("Growth pays its own way") eroded our quality of life, water quality and our Everglades and dimmed our economic prospects by setting South Florida on a course where only more growth and development could bail us out. The disclosures would paint the picture of corporate politics disguised as democracy; from county commission races to presidential campaigns like the one that delivered the United States to George W. Bush through the halted recount in downtown Miami and its legacy, FreedomWorks. (for more, you will have to read our archives).

One has to read between the lines of the FDIC Consent Order with US Century to understand just how suspicious and mistrustful federal regulators are. Over this week, we will focus on a few of the highlights. For example on Page 3:

The implication is that official records of the Board of US Century Bank or incomplete or maybe in a storage box that can't be found. Complaints to the Florida Bar Association and to the Division of Professional Regulation would be in order. If only it were a just world.