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UNITED
BEFORE
TEE BOARD
STATES
OF GOVERNORS
OF AMERICA
THE E'BDERAG RESERVE
OF
WASHINGTON,
In the Matter
DC
x
of
Docket
MICHAEL
SYSTEM
No.
97-025-E-I
WACHS
Order of Prohibition
Issued Upon Consent
Pursuant to the Federal
Deposit Insurance Act
as Amended
A Former Officer and
Institution-Affiliated
Party of
CHASE MANHATTAN
CORPORATION
New York, New York
CHASE SECURITIES
INC.
New York, New York
WHEREAS,
Federal
Deposit
55 1818(e)
Reserve
System
Prohibition
former
defined
and
pursuant
Insurance
as amended
(i) (3)), the Board
(the "Board
Director
in Section
and
to Sections
Act,
(the "Order")
Managing
55 1813(u)
x
3(u)
and
and
Michael
New York
and Chase
Securities
("CMC"),
Inc.,
issues
this Order
Wachs
8(b) (3) of the Act
a registered
("Wachs"),
a nonbank
subsidiary
party,
of
a
as
(12 U.S.C.
Manhattan
bank
(12 U.'S.C.
of the Federal
institution-affiliated
1818(b) (3)), of the Chase
New York,
(the "Act")
of Governors
of Governors")
against
S(e) and S(i) (3) of the
Corporation,
holding
company,
of CMC,
due
to
.
L
Wach's alleged engagement in a fraudulent scheme to purchase CMC
assets by means of a fraudulent bidding process and to obtain a
profit from the immediate resale of those assets;
WHEREAS, on Dercmbu
IS
, 1997, Wachs pled guilty in
the U.S. District Court for the Southern District of New York to
violating 18 U.S.C. § 1344(Z), Bank Fraud; and
WHEREAS, by affixing his signature hereunder, Wachs has
consented to the issuance of this Order by the Board of
Governors and has waived any and all rights he might otherwise
have pursuant to 12 U.S.C. § 1818 or 12 C.F.R. Part 263, or
otherwise:
prohibit;
(a) to the issuance of a notice of intent to
(b) to a'hearing for the purpose of taking evidence
with respect to any matter implied or set forth in this Order;
(c) to obtain judicial review of this Order or any provision
hereof; and (d) to challenge or contest in any manner the basis,
issuance, validity, terms, effectiveness or enforceability of
this Order or any provision hereof.
NOW, THEREFORE, before the taking of any testimony or
adjudication of or finding on any issue of fact or law herein;
without this Order constituting an admission of any allegation
made or implied by the Board of Governors in connection with this
3
proceeding;
and
solely
proceeding,
without
protracted
IT IS HEREBY
(i) (3) and
for the purpose
or extended
ORDERED,
(j) of the Act
of settlement
pursuant
(12 U.S.C.
hearings
to Sections
§§ 1818(e),
of this
or testimony:
8(e),
(i) (3) and
(j)),
that:
1.
the Board
without
Wachs,
of Governors
and,
the prior
where
Section
8(e) (7) (B) of the Act
another
federal
hereby
financial
and henceforth
(a)
of the affairs
Section
8(e) (7)(A)
including,
but
not
or subsidiary
consent,
any
limited
to
§ 1818(e) (7) (B)),
regulatory
in any manner
or agency
(12 U.S.C.
to, any
agency,
is
in the conduct
specified
in
§ 1818(e) (7) (A)),
insured
or savings
soliciting,
to transfer,
or authorization
institution
pursuant
of
from:
institution
of the Act
approval
depository
association
holding
company
thereof;
(b)
attempting
institution
Participating
or any bank
institution,
necessary
(12 U.S.C.
prohibited
of any
written
described
voting
with
procuring,
or attempting
respect
in Section
transferring,
to vote
to any voting
any proxy,
rights
8(e) (7) (A) of the Act;
in
4
(cl
violating any voting agreement previously
approved by any federal banking agency; or
Cd)
voting for a director, or serving as an
institution-affiliated
party, such as an officer, director or
employee, of any institution described in Section 8(e) (7) (A) of
the Act.
2.
Any violation of this Order shall separately
subject Wachs to appropriate criminal or civil penalties or both
under Section 8 of the Act (12 U.S.C. § 1818).
3.
This Order, and each and every provision hereof, is
and shall remain fully effective and enforceable until expressly
stayed, modified, terminated or suspended in writing by the Board
of Governors.
4.
addressed to:
All communications regarding this Order shall be
-
(a)
Mr. Christopher J. McCurdy
Senior Vice President
Federal Reserve Bank of New York
33 Liberty Street
New York, New York 10045
5
(b)
5.
Mr. Michael Wachs
360 East 72nd Street
B-801
New York, NY 10021
The provisions of th&
Order shall not bar,
estop or otherwise prevent the Board of Governors or any federal
or state agency or department from taking any other action
affecting Wachs.
By order of the Board of Governors effective this
day of &&J;)
,
19::
u3de
BOARD OF GOVERNORS OF THE
FEDERAL RESERVE SYSTEM
By:
William W. Wiles
Secretary of the Board