Riggs Bank official David Isner's name was misspelled in a May 6 Business section story about bank expenditures.
The Personal Side Of Riggs's Money
Friday, May 6, 2005
On Feb. 4, 2003, John Koloszar, the personal driver and bodyguard for Joe L. Allbritton, drove off the Euro Motorcars lot in Bethesda in a sparkling new, emerald green Mercedes sedan, fully loaded. The S430, with a V-8 engine and all-wheel drive and tan interior, had 12 miles on it. The price tag: $91,444.
According to sources, Koloszar drove Allbritton's new ride to the 17th Street NW headquarters of Riggs Bank and presented the invoice to David Eisner, a manager in accounts payable. Eisner -- a longtime Riggs employee who was accustomed to cutting checks for items purchased by the Allbritton family for the bank -- refused to authorize payment.
Eisner was backed up by bank Chief Financial Officer Steven T. Tamburo: Allbritton was not a bank employee; it wasn't company policy to provide cars for directors, and the automobile had not been bought through normal channels.
Then Koloszar asked the president of the bank, Lawrence I. Hebert, to authorize payment.
Hebert did. And Allbritton had his green Mercedes, paid for by the shareholders of Riggs.
At the time, Allbritton was a board member but not a Riggs employee. He had resigned as chief executive two years earlier, handing over management to his son, Robert, and his longtime business lieutenant, Hebert.
In Allbritton's years at Riggs, even as he began to relinquish control, he often used the bank to pay for expensive items and services from which he and his family benefited, according to sources with direct knowledge and other people familiar with an ongoing Department of Justice investigation into use of the bank's assets. The sources, and vehicle ownership records, also confirmed how payment was obtained for the Mercedes.
"The Allbrittons at all times adhered to all applicable laws and regulations, including those of the IRS as well as corporate policy," said Paul Clark
The investigations are an outgrowth of two years of trouble at the bank, including a record fine for failing to abide by federal anti-money-laundering laws and revelations of suspicious transaction in accounts held by former Chilean dictator Augusto Pinochet and the dictator of Equatorial Guinea. Riggs agreed to be acquired by PNC Financial Services Group Inc. in a merger that is scheduled to be completed May 13.
Other examples of Allbritton's use of bank assets include:
· The use of bank employees, including one skilled in calligraphy, and bank equipment to create personal stationery, including invitations for wedding-related parties for Robert in 2003.
· Riggs employed a driver, a fitness instructor and a massage therapist whom Joe Allbritton used.