George Norcross, Gregory Braca and Philip Norcross, leaders of the Norcross-Braca Group, have filed an objection to the proposed settlement agreement between Republic First Bancorp and the Federal Deposit Insurance Corp. in the United States Bankruptcy Court for the Eastern District of Pennsylvania, the group said.
The 2024 failure of FRBK was the sixth-largest failed bank by total assets since 2010, costing shareholders and taxpayers an estimated $1 billion. The Norcross-Braca Group has separately filed a derivative action against FRBK Directors Andrew Cohen, Harry Madonna, Lisa Jacobs, Harris Wildstein, Benjamin Duster IV and Peter Bartholow for their alleged gross management failures.
In the new filing, the Norcross-Braca Group states that the Republic First agreement with the FDIC does not provide sufficient protection for the shareholders and others harmed by the contended mismanagement of the bank by its board members.
“(The Norcross-Braca Group) believe(s) the proposed Settlement Agreement lacks necessary clarity for the parties, and the Court, to determine whether the settlement is reasonable and in the best interest(s)” of impacted parties. “… Specifically, it remains unclear to what, if any, extent the terms and conditions of the Settlement Agreement impact (ongoing lawsuits) and whether any component of the proposed settlement could have the unintended consequences of diluting the merit of the meritorious claims in” those suits.
In its separate suit, the Norcross-Braca Group identifies what it said were just a few of the many purported management failures that reputedly caused the collapse and sale of Republic First, including:
- Andrew Cohen reneged on a plan to inject new capital into Republic First, despite winning approval from fellow board members. Cohen’s decision “was widely publicly reported and caused the bank’s stock value to drop precipitously. The bank did not recover from this setback.”
- Other board members enriched themselves through stock, grants, options, retirement, benefits, etc., during Cohen’s tenure as chairman.
- FRBK failed to file basic and required financial information with relevant authorities and regulators, “signaling doubts about the bank’s financial records which stemmed from internal control weaknesses.”
In the new filing, the group said the ongoing management failures were known to the FDIC.
“During the year-and-one-half period the shenanigans outlined in (the lawsuit) leading to the bank’s seizure were occurring, FDIC did nothing. To date, the FDIC has done nothing to bring the perpetrators of these shenanigans to justice or to make them account financially for the harm they have caused to the bank, the shareholders and the public.”
