Two jurors disagreed vehemently with the majority's conclusion. Retiree Raymond Eagan, who was not pleased to spend almost a year of his life sorting out the fight between lawyers for two big companies, believes that what Standard Chartered's attorneys did to Laurie Pollitt was a crime in and of itself.

"These [lawyers] were making $500 an hour or $250 an hour," he says. "They make a woman who's under 30 years old look like a complete and utter asshole. That's not right. I think it was unfair because she was credible. She didn't steal any money. She didn't cause the damn bank to go under."
In fact, United Bank never did go under. Although it lost a lot of money, it never required a taxpayer bailout or intervention by federal regulators. There have been no criminal allegations of fraud or chicanery.

But United Bank's problems did mirror what happened to banks nationwide during the late 1980s. It was riding a boom carrying problem loans, even former president James Simmons acknowledges. When the bust came, the time bombs began to explode.

in february 1987, about three weeks after the United sale to Standard Chartered had closed, the first time bomb was laid on Simmons' desk.

A bank officer who did not normally review loans happened to look at a list of people who were past due on their accounts.

On the list was the Victorio Land and Cattle Company, which was run by Peter Wray, then husband of Gay Firestone Wray, a niece of the Firestone rubber family. Wray's company was the bank's largest single borrower with more than $18 million in loans, according to a Standard Chartered attorney.

Alarmed, the officer brought the loan up with Simmons. The bank president called in Paul Milus, the bank's chief credit officer. Milus had been with the bank for 20 years, trial testimony showed, and had been one of the people who sat across the conference-room table from Simmons three weeks earlier and assured him that he could sign the certificate attesting to the bank's soundness.

Simmons told Milus to bring in the loan files on Victorio, and learned, he says, that his chief credit officer had been lying to him. The Wray loans were a disaster.

For several years, trial testimony established, Wray's businesses--including cattle ranches and a real estate brokerage firm--had been in shambles. But instead of going under, Wray just kept asking for more money from the bank, and Milus kept giving it to him.

"Notwithstanding the acknowledged, obvious fact in the loan files that the company couldn't pay its bills through profits or cash flow, the bank continued to loan it millions of dollars," says Standard Chartered attorney Mark Dangerfield.

Within a matter of hours of looking at the Victorio files, Simmons testified, he realized that the bank was going to suffer a major loss. "It was obvious to me that the collateral was not sufficient to pay the loan by a substantial amount," Simmons testified at trial. After several days of investigating, the bank determined that it would have to write off $13.5 million in losses from the Victorio loans.

When informed of the losses, Standard Chartered had every right to be upset, Simmons says, because even he felt betrayed by a chief credit officer he says he trusted. "Obviously. . .it was misrepresented," Simmons says. "I don't think there's any question. It was misrepresented to me, and it was misrepresented therefore to [Standard Chartered]."

Simmons said Milus could not give him an adequate explanation of why he had continued to lend Wray millions of dollars without collateral. Milus, who was fired immediately after the Victorio loan problems were discovered, faces a separate lawsuit by Standard Chartered for his handling of the Victorio situation. Victorio went out of business. Wray and his wife were divorced, and he could not be located for comment. Milus, when approached for an interview, swiftly closed the front door of his home at the base of Camelback Mountain.

Ultimately, Simmons said, the bank decided that Milus' decision to continue lending Wray money was an isolated "dysfunction" on Milus' part. Whatever reasons Milus had for continuing to lend Wray money, and covering up the weakness of the loans, were apparently specific to Wray. No other large loans Milus had handled seemed to be at risk, Simmons said.

But over the next few months, federal bank examiners came across more burning fuses. When the Federal Deposit Insurance Corporation came calling for its regular review of the bank, lead bank examiner Norton Cook would later testify, investigators were deeply troubled by problems they found in United's books. There appeared to be millions of dollars more in loans on the verge of default.

Given the bank's condition, Cook later testified in a deposition, the bank's loan-loss reserves--money set aside to cover bad loans--were "grossly inadequate."

The underlying problems, Cook testified, seemed to be that the bank was growing too fast and its loan process was not keeping pace. Controls weren't in place to make sure that loans were being properly analyzed before they were made.

"Many of these loans were not well-documented, had major problems in their credit-analysis area, loan files were disorganized," Cook said in deposition.

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