Legal Question in Business Law in New York
Could a corporate raider take control of a small or mid sized regional bank and then use the banks funds (excluding the required reserves) to invest in securities such as stocks and bonds? Could they also use the funds to finance their own ventures through loans to their other entities? Say for example an activist gains control of a bank and uses $10m of the banks funds to finance another business that the activist has an interest in.
Asked on 2/09/15, 11:55 am
1 Answer from Attorneys
SHAHRIAR KASHANIAN
LAW OFFICES OF SHAHRIAR KASHANIAN, ESQ.,
No. There are strict regulations against double dealing and permissible use of bank funds for investments. You may, however, get away with it in hedge funds or private placement investments within certain parameters.
Answered on 2/09/15, 1:02 pm
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