That quote is what London Mayor, Boris Johnson, recently called Prime Minister Gordon Brown in issuing him a political challenge . . . but I’ve re-purposed it here as it pretty much sums up my feelings about a certain governmental agency. As you might have read in a recent Orlando Sentinel article: Emergent National Bank (ENB) will NOT be moving forward at the present time. Yes, you read that correctly. The national bank we have spent over 15 months forming (that would acquire MCC and keep as a very profitable division of ENB) has ceased its organization. Quite candidly, we have spent considerable time and money on this, only to be strongly discouraged at the gates of our final regulatory approval. You might know that we received our OCC (Office of the Comptroller of the Currency) charter approval in early September after many months of field examination by both the OCC and the FDIC. Nearly 90 days after our OCC approval, American Banker ran a feature story alleging what we’ve been suspecting for some time: that the FDIC appears to have an “unofficial moratorium” on approving any new bank charters. If this is proven, there will undoubtedly be political hell to pay for FDIC Chairwoman Bair as she tries to get re-appointed to another term under President Obama in two years.
The treatment we received and the outcome of all of this is a travesty. Plain and simple. To say we’ve been disenfranchised would be putting it politely. But I’m afraid suing them would be pointless – – their pockets are a bit deeper than ours and they indirectly own the printing presses. In any other “normal” time, an organizing group such as ours would have had little trouble getting all the necessary approvals. In fact, my business partner and the Chairman of MCC, Geof Longstaff, had gone through this process successfully no less than 16 years ago. Including Geof, our organizers included two other experienced national bank directors, plus we had what no other start-up bank had: a very profitable and nationally-prominent commercial finance company with earning assets that would have shortened the typical start-up bank’s timeframe to reaching profitability. Our organizing group was much stronger than the one Geof led 16 years ago . . . but oh, how times have apparently changed.
Propping-up Failures at the Expense of Strengthening Success
Well, all of this seems to have been for naught. It appears that the FDIC wants to prop-up failing banks – – the result of poor decision-making from questionable management – – rather than approve a “clean” entity such as ours, with a successfully-growing and profitable company (MCC) as the “crown jewel.” The bureaucrats at the FDIC conjured up every possible reason not to approve us . . . even citing outdated and mistaken research to support their wrong-headed conclusions. Frankly, it was a little embarrassing to hear them try to justify the direction they were heading, so we did the only honorable thing we could: we withdrew our application for federal deposit insurance . . . and you simply don’t start a bank without this.
I suppose this is “redistribution of wealth” at its governmental finest – – the complete disregard for entrepreneurial capital put at risk to try to form an entity to help America’s business owners and entrepreneurs in an obvious time of need. Funny, Mr. Vice President . . . I don’t feel very patriotic about my tax dollars supporting such incompetence. My mentor put it this way: “Our government has stepped into the futile, costly, and dangerous role of attempting to convert dedicated losers into winners – – mostly by pouring billions of dollars into the gaping, black holes they’ve dug for themselves” and “investing in losers at the expense of winners is a stunningly stupid proposition.”
I believe it was our third President, Thomas Jefferson, who once said, “I predict future happiness for Americans if they can prevent the government from wasting the labors of the people under the pretense of taking care of them.” Of course, he also stated, “The democracy will cease to exist when you take away from those who are willing to work and give to those who would not.” There is a very dangerous precedent being set by our leaders right now, and I find it deeply troubling. I suspect I’m not alone.
So Where Do We Go From Here?
Ever the diligent entrepreneurs, we have nothing else left to do but to pick up the pieces and move forward. More to come on the future of MCC . . . stay tuned!