Former American Business Bank CFO Julie Verner is suing the Los Angeles-based bank, saying she was demoted and terminated after she raised concerns over some senior executives' use of company funds for personal expenses, the Los Angeles Business Journal reported.
Verner alleges that the bank's CEO, Leon Blankstein, and chief investment officer, Wes Schaefer, violated Regulation O by using the bank's corporate credit cards to pay for non-work-related hotel stays, vacation cruises, medical expenses and luxury items such as jewelry and women's lingerie. Regulation O is a federal rule that monitors a bank's credit extension to an executive officer, director or principal shareholder.
Verner also alleged that both Blankstein and Schaefer pulled a personal line of credit of $90,000 and cash advances on their salaries, the news outlet reported.
In a lawsuit filed in the California Superior Court in early April, Verner says she was demoted after she raised concerns about the expenditures, was placed on medical leave in December 2017 and terminated in January 2019. Verner, who has served as the bank's CFO from June 2016 to late 2017, is seeking punitive damages.
The court has scheduled a case management conference for Aug. 7, according to the report.