Colonial Battle

Colonial Battle

A purported whistleblower at Colonial Bank has the tables turned on him.

By Francis X. Gilpin

Associate Editor

Who's competing against whom here?

Anthony F. Gonzalez was fired last spring from the chairmanship of Colonial BancGroup Inc.'s Tampa regional board of directors. Gonzalez later went to court to accuse Colonial's Tampa chief executive of dismissing him because he exposed the CEO's role in a finance company that competed against Colonial Bank.

But the CEO's lawyer claims it was Gonzalez who was serving two masters. William F. Jung says Gonzalez worked for the Bank of St. Petersburg while still at Colonial.

Gonzalez has since become the Bank of St. Petersburg chairman, according to a private-placement memorandum for an upcoming stock offering that Jung submitted to the court.

Jung, a partner at the Tampa law firm of Jung & Sisco, had more to say about Gonzalez in a pleading that accompanied the filing of the document: "His connivance in this regard while still at Colonial was a prime reason why he was fired there."

Gonzalez has charged in two lawsuits and a federal labor complaint that Colonial's Tampa CEO, Joseph V. Chillura, canned him for notifying Colonial's holding company in Alabama that Chillura and another top officer were competing against their own employer.

The controversy has made things sticky in Tampa's tight-knit Latin business and political establishment.

Gonzalez, 58, once a high-profile criminal defense lawyer, co-founded Tampa's Manufacturers Bank of Florida in the 1970s. The bank catered to the old Latin neighborhoods of Ybor City and West Tampa until Colonial bought it in 2001.

Chillura's father is a former Hillsborough County commissioner and Tampa city councilman. The younger Chillura, 37, replaced Gonzalez in the local Colonial chairmanship with M.G. "Manny" Alvarez Jr., husband of Tampa City Councilwoman Mary Alvarez.

The board of directors of Colonial's Montgomery, Ala.-based holding company ordered an investigation into Gonzalez's complaint. The investigation appears to be finished.

But the directors have asked Hillsborough Circuit Judge Gregory P. Holder to seal a report on the investigation when they file it in court. The report contains "sensitive and confidential business information," the Colonial directors say. "The disclosure of this information to competitors of the bank could result in substantial damage to the bank."

Chillura wasn't too concerned about competition last year when he and Alfred T. Rogers, president of Colonial's Tampa region, got involved with MCapital II LLC, according to Gonzalez.

County records show MCapital made mortgage loans to several Tampa businesses, including a company run by the Capitano family, one of the most powerful in Tampa's Latin community. Gonzalez says those businesses could have gone to Colonial for their loans.

MCapital has a brief history. It was formed in March 2002. Since Gonzalez began his legal counter-punches, however, the Florida secretary of state has dissolved MCapital for not filing a 2003 annual report. MCapital's principal office was that of Luciano L. Prida Jr., a certified public accountant and ex-Tampa city auditor who served on Colonial's regional board with Gonzalez, Chillura and Rogers. Gonzalez says Prida lost a consulting contract with Colonial around the time of his dismissal because "we 'blew the whistle.' "

Like Gonzalez, though, Prida has turned up on the Bank of St. Petersburg's board.

Bank of St. Petersburg is a unit of Black Diamond Financial Group Inc., now known as Bank of St. Petersburg Holdings Inc. Established in 1985, it has two offices, both in St. Petersburg, and assets of $78 million. As of June 30, the bank had less than 1% of the deposits in the Tampa metropolitan area.

Both Gonzalez and Prida were founding directors of Manufacturers Bank. After the sale to Colonial, Gonzalez was made chairman of the Tampa regional board at an annual salary of $100,000, plus benefits. Colonial Bank had 1.7% of the deposits in the Tampa metropolitan area, as of June 30.

Gonzalez says Robert E. Lowder, the holding company chairman in Montgomery, told him that he had authority over Chillura and Rogers in Colonial's Tampa pecking order. But Chillura wielded the real power.

In a May 8 letter, Gonzalez told Lowder that he was "extremely upset" to have learned that Chillura and Rogers were writing loans through MCapital. Gonzalez told Lowder that he had confronted them. Chillura and Rogers promised to sell MCapital. But Gonzalez says that didn't happen, prompting him to write Lowder.

A day later, Chillura picked up his own pen. Gonzalez was through at Colonial, Chillura wrote. Chillura told Gonzalez via mail that the dismissal was effective that day, May 9. Chillura copied the letter to Lowder.

Gonzalez reacted by filing for whistleblower protection in circuit court. Gonzalez also claimed he was defamed. An unnamed Colonial spokesman told the St. Petersburg Times that Gonzalez resigned the chairmanship due to "personal business demands." Gonzalez evidently took that characterization of his departure to mean that he wasn't up to the Colonial job. That lawsuit has since moved to federal court.

Meanwhile, back in circuit court, Gonzalez filed another suit as a Colonial stockholder. In that action, Gonzalez accused Chillura and Rogers of breaching their fiduciary duty by refusing to sever their ties to MCapital.

Colonial BancGroup, which trades its common shares on the New York Stock Exchange, has struck back. While Chillura brought up Gonzalez's new employment, Colonial wants to disqualify one of Gonzalez's attorneys, Stanford R. Solomon of Tampa's Solomon Tropp Law Group PA.

The bank says Solomon cannot represent Gonzalez in the federal whistleblower case while also doing the same in the shareholder derivative suit in circuit court. Colonial lawyers argue that Gonzalez wants to press a derivative claim on behalf of the bank at the same time he is seeking damages from the bank in the whistleblower case. That presents a conflict of interest for Solomon, says Colonial lawyer Karen Meyer Buesing of Tampa's Zinober & McCrea PA.

While awaiting Holder's rulings on the status of Solomon and the terms under which Colonial will file the investigation report with the court, the bank has subpoenaed records from an array of local financial entities and businessmen. Those include Robert Rothman, chairman of the Bank of St. Petersburg's holding company.

Gonzalez's roster of potential witnesses is no less interesting. It includes officers of businesses that borrowed money from MCapital. It also lists two executives of the Columbia restaurant chain, Richard Gonzmart and Dennis J. Fedorovich, who "may have knowledge of Chillura's statements regarding Anthony Gonzalez."

Neither side will shed much additional light on the dispute, which also led Gonzalez to complain to the U.S. Department of Labor that the alleged retaliation against him violated the Sarbanes-Oxley Act.

Colonial spokesman Bob Howell says the bank doesn't comment on pending litigation. Gonzalez attorney Solomon didn't return messages left at his office by GCBR.

Another Colonial lawyer, Michael S. Hooker of Glenn Rasmussen Fogarty & Hooker PA in Tampa, acknowledges his client probably cannot legally prevent Gonzalez from examining the directors' investigation report. But Hooker wants Gonzalez to keep the document to himself.

"They would be instructed not to show it to anyone else," Hooker suggested at an Oct. 27 court hearing. "It remains confidential."