Bridgeport Community Bank that Bridgeport’s BOE Chair Kenneth Moales Jr won’t pay back goes under

In an article entitled, “State Has First Bank Failure In A Decade, the Hartford Courant reported last night that, “The Community’s Bank, with its headquarters and one branch in Bridgeport, came under the receivership of the Federal Deposit Insurance Corp. late Friday afternoon amid mounting losses from commercial real estate loans.”

“Shocked and saddened” is what Bridgeport Mayor Bill Finch said in a statement, adding “…It is not clear how the state could allow this to happen.”

Shocked?

Not clear how the state could allow this to happen?

What Mayor Finch failed to reveal and the Hartford Courant didn’t report is that The Community Bank is one of the mortgage holders that Finch campaign treasurer and Bridgeport Board of Education Chairman, Kenneth Moales Jr, has failed to repay.

Since April of this year, Wait, What? readers have been learning about the massive financial problems facing Moales his church.

See: Is Bridgeport Board of Education Chairman Kenneth Moales, Jr.’s financial empire collapsing? (April 30), Wait, What? Bridgeport Board of Education scheduled to approve $1 million for Moales Daycare facilities despite foreclosure threat (May 13), Moales Empire Collapsing, Moales’ state funded childcare sites being foreclosed on (June 20),  Update: Moales Empire Collapsing, foreclosure to take his state funded childcare sites, churches and apparently his residence. (June 21) News Update: More on financial problems facing Bridgeport Board of Ed. Chair Kenneth Moales, Jr. and his church (June 26).

As reported in those articles, in addition to the $8 million plus in principal and interest owed to Foundation Capital Resources, Inc., Moales and his church owe hundreds of thousands more to various contractors, the City of Bridgeport,  the state of Connecticut and Community Bank of Bridgeport.

The Community Bank of Bridgeport loaned Moales and his family $175,000. As collateral for that loan, Moales used his mother‘s residence, which is owned by Moales’ church, as well as the full faith and credit of the church.

Despite benefiting from a $1 million dollar day-care contract his family “won” from the Malloy administration and raking in hundreds of thousands of dollars from his parishioners, Moales failed has consistently failed to make his mortgage payments.  One of the entities Moales has refused to pay is The Community Bank in Bridgeport.

Although Moales hasn’t made his legally required payments, he has had the funds to drive fancy cars, wear expensive suits, go on long vacations and send his children to the costly Fairfield Day School, all while supporting Mayor Bill Finch, faux superintendent Paul Vallas and their combined efforts to privatize and run the Bridgeport School System into the ground.

According to the Hartford Courant,

“Chartered in 2001, The Community’s Bank was the state’s only minority-owned lender, and its finances had come under increased scrutiny from regulators since 2010.The traditional focus of minority-owned banks on urban, rather than suburban, areas, provided a major obstacle to building the bank, said state Banking Commissioner Howard F. Pitkin, who issued Friday’s order.’They found it difficult to grow,’ Pitkin said. “They never reached the point where they were making money.”

While Moales’ connection to the demise of Bridgeport’s Community Bank is noteworthy, the Hartford Courant story revealed an equally unsettling development.

The Courant is reporting that, “Late last month, an investor group filed an application with the state Department of Banking for approval to invest in the bank and become a minority shareholder. The group was led by TicketNetwork Chief Executive Donald Vaccaro.  A spokeswoman for Vaccaro said late Friday that the effort was supported by U.S. Reps. Jim Himes and John Larson.”

“The cash infusion that I would have provided [would have] meant more loans for inner city development, fewer blighted properties, and more jobs for inner city folks,” Vaccaro said in a statement. “Instead of a rescue by me, closing the bank will cost the state and the federal government millions of dollars and cause a loss of many jobs in the city of Bridgeport.”

The Courant went on to report that “a banking department spokesman, declined to comment late Friday because the application is pending.”

But as Wait, What? readers may recall, TicketNetwork and Vaccaro have been in the news before.  TicketNetwork was chosen by Governor Malloy to be his 2nd “First Five” corporate welfare recipient.

See: Shhh… over here… I got some tickets – “cheap”, State Gives Company Millions to Create Jobs – Claims it didn’t know about employee lawsuit…, Oh those crazy CEO’s (aka Our Tax Dollars at Work), First Five Company #2 – TicketNetwork – Takes the Fall, They’re BACK! TicketNetwork moves to “corner” the world market by controlling domain names ending with “.tickets”

Malloy choose TicketNetwork, the “online ticket exchange company” (whatever you do, don’t call them ticket scalpers), despite the fact that Vaccaro and TicketNetwork had a pending lawsuit against the president of the Bushnell.

At the time Malloy announced the multi-million dollar deal with TicketNetwork, Vaccaro and his company had a lawsuit pending against the Bushnell’s David Fay for slander because Fay had spoken at a Connecticut legislative hearing calling for stronger laws to protect consumers and artistic venue such as the Bushnell.

TicketNetwork went to court seeking damages and demanding a retraction because the Bushnell’s representative said that TicketNetwork was “a company that puts tickets to popular events on ‘hold’ and then attempts to sell those tickets to third parties at inflated prices.”

According to the CEO of TicketNetwork, “Mr. Fay’s slanderous comments were made in order to influence Connecticut legislation. That is reprehensible and subverts the whole legislative process.”

When Governor Malloy was asked about the whole controversy surrounding ticket re-sellers and whether the state’s taxpayers should be supporting such an industry, Malloy said “that is all part of the growing pains of this new emerging market.”  Malloy went on to say “”There will be winners and losers in any emerging industry” and that the solution is to set up appropriate rules and then, “quite frankly, get out of the way.”

At the time, Malloy’s corporate give-a-way plan to Vaccarro’s company also overlooked a major sexual harassment lawsuit that was pending against Vaccaro and TicketNetwork.

However, despite spending more than $127,000 on lobbying fees, when Vaccaro later verbally abused a bouncer at a Hartford gathering and uttered a string of racial slurs, TicketNetwork was convinced to withdraw his “First Five” application.

The fact that Vaccaro now shows up with an application to invest in Bridgeport’s Community Bank while claiming his application has the support of Congressmen John Larson and Jim Himes is certainly worthy of some more investigation.

As is, of course, the notion that Bridgeport’s Mayor, Bill Finch, is “shocked” and says “It is not clear how the state could allow this to happen,” when the official record reflects the fact that it was at it was Kenneth Moales whose actions helped tank this local community bank.

  • Sleepless in Bridgeport

    Corupticut……thy name is Bridgeport. Bring back Ganim…he only took a dollar per square foot. Associating our savior with Holy Moly is an affront to organized religion. I’ll bet a man all dressed in red with a tail and horns just skated up to the good Rev and said: “Holy….it just froze over”

  • buygoldandprosper

    Dan Malloy has a history with failed S&L’s , back in the day, with failed real estate ventures. One wonders if he ever paid off those real estate loans or were they “forgotten” the way many things are down in Stamford. Another “distraction” on the road to Demi-God status for Dan?
    I GUARANTEE that there will be way bigger “distractions” that Nutmeggers will have to pay off, thanks to this inept governor and his administration. In the meantime, Dan keeps a low profile, waiting to declare and letting the dust settle.
    Quebec was not far enough. Dan belongs in a gulag in Siberia.
    Dan Malloy…John Rowland Lite

  • Castles Burning

    This is one of those posts where my mouth is open the whole time (and I think widens with the reminder of TIcketNetwork). As always, Jonathan, thanks for reporting and contextualizing and adding the critical pieces of the puzzle. More to be said does not need to be said . . .

    I would like to hear what Rev. Moales and those who trusted in him have to say.

    Jonathan’s last line, which often deserves reiteration–“[T]he notion that Bridgeport’s Mayor, Bill Finch, is ‘shocked’ and says ‘It is not clear how the state could allow this to happen,’ when the official record reflects the fact that it was Kenneth Moales whose actions helped tank this local community bank.”–reveals yet again what a victory for all of Bridgeport Tuesday’s BOE primary results were.

  • jrp1900

    The most telling line in the article: “…he has had the funds to drive fancy cars, wear expensive suits, go on long vacations and send his children to the costly Fairfield Day School…”
    Obviously, Rev Moales does not subscribe to the “absurd” Christian doctrine (put forth by one Jesus Christ) that the “meek will inherit the earth.” Rev Moales is not so much a “good Christian” as a “true American”: he understands that in this life, in this fallen sinful world, it’s all about “getting yours”–getting it now, not tomorrow; and getting about as much as you can. Clearly, Moales and Finch have a marriage of mutual convenience: they use each other to get what they want. Finch uses Moales to gain leverage in the African American community for his school “reform” agenda, headed by the fraudster Paul Vallas. For his part, the Rev Moales uses Finch in pursuit of his one, true god: the god of money.
    Perhaps somewhere down the line, Moales and Finch will keep each other’s company as they wait out eternity in the 9th circle….

    • brutus2011

      My cousin, a Yale graduate once told me that the most important thing she learned at Yale was that winning is not the most important thing, it’s the only thing.

      And yes, she has gone on to be a successful executive.

      So,”jrp1900″ –your post is right on…

      • jrp1900

        brutus2011: In the United States, there is really only one cardinal rule: don’t get caught! Whatever it takes to win is permissible–greed, deceit, opportunism, cunning…they are all good. The winner of the game is the one who dies with the most treasures.

        Rev Moales resides in Bridgeport, one of the poorest cities in the United States. No doubt, many of his parishoners are desperately poor people. But the Rev Moales is not about to take seriously any nonsense about the rich not getting into heaven. He follows the tried and trusted pathway of the American evangelist: he does “good” for others by doing well for himself!

    • Eric Alicea

      Moales didn’t deliver the African American vote. His church is in Councilman Baker’s district and the B.E.S.T slate demolished the endorsed slate in that district.

  • Sad In Bridgeport

    Oh. My. God. I’m going to go take my husband’s blood pressure medication.