Bank Seeks $22M Coverage Over Ponzi Scheme Loans

Law360, New York (February 11, 2011, 7:58 PM EST) -- Integra Bank Corp. sued its insurer Fidelity and Deposit Co. of Maryland on Friday, demanding coverage of $22 million in losses stemming from loans a former employee issued to Ponzi schemer Lou Pearlman.

In its complaint, filed in the U.S. District Court for the Southern District of Indiana, the bank claims that FDCM has breached its contract with the bank by not paying for the losses covered under its insurance policy.

The losses can be traced to Stuart Harrington, Integra's executive vice president of commercial lending...
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