N.D. Banks Sue Pearlman
More than a dozen North Dakota banks have been caught up in the mess that is Lou Pearlman and his companies.
The former music impresario who gave the world ’Nsync and Backstreet Boys has been accused by Florida financial regulators of running a giant Ponzi scheme. He’s said to owe more than $120 million to banks.
Tim Karsky, commissioner of North Dakota’s Department of Financial Institutions, said the banks apparently loaned money to Pearlman based on documentation that looked genuine. That included financial information from a Florida certified public accountancy that was apparently fabricated.
At least two banks, the First International Bank & Trust of Watford City and the First National Bank & Trust Co. of Williston, already have filed lawsuits against Pearlman and companies he controlled, court filings say.
Karsky said the losses would dent the banks’ earnings but emphasized their soundness was not threatened.