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US banks' trio of alleged loan fraud spark fear of broader issues
The Straits Times
|October 18, 2025
Relative to the collapse of First Brands Group and Tricolor Holdings, the hits disclosed by regional lenders Zions Bancorp and Western Alliance Bancorp seemed small - a figure in the tens of millions, not billions.
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Still, the back-to-back reveal of loan fraud has renewed the simmering debate on Wall Street about whether the era of free wheeling capital is about to bring a comeuppance for banks and non-banks alike.
In the case of Zions and Western Alliance, the alleged culprits were the same: Investment funds tied to Mr Andrew Stupin and Mr Gerald Marcil, among other parties, borrowed the funds to finance their purchases of distressed commercial mortgage loans.
A lawsuit from Zions revealed that its wholly owned subsidiary, California Bank & Trust, provided US$60 million (S$77.6 million) to the borrowers, and that an investigation found many of the notes and underlying properties were transferred to other entities - allegations that the two men's attorney said they "vehemently deny".
This story is from the October 18, 2025 edition of The Straits Times.
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