In some editions yesterday, a story on Old Court Savings & Loan contained an incorrect first name for Albert Turkus, the attorney representing the United Wire Metal and Machines Workers.
A judge overseeing the affairs of Old Court Savings & Loan today approved Gov. Harry Hughes' pay-back plan for depositors, clearing the way for the release of funds by early April.
Under the plan, Old Court depositors will have access to up to $5,000 each for the first time since accounts in the thrift were frozen last May. All individual retirement accounts will be transferred to IRA accounts at Maryland National Bank.
The plan will give 17,103 depositors -- half of Old Court's customers -- full access to their money.
Baltimore City Circuit Court Judge Joseph H.H. Kaplan approved the plan over the objections of some depositors who contended the pay-back formula is unfair because it aids small depositors at the expense of larger ones.
The $113 million April payout to depositors will be funded by the state, mainly through the transfer of $100 million from the state's transportation trust fund.
Among those opposed to the plan were attorneys representing a committee of depositors and a metalworkers union that has large pension and benefits accounts tied up in Old Court.
This group had asked Kaplan to set a single percentage withdrawal for all depositors.
Albert Turkus, attorney for the United Wire Metal and Machine Workers, argued that his clients would receive only a tiny fraction of the $17.5 million they have tied up in Old Court. Hughes' plan, he said, is designed to quell criticism from as many depositors as possible, without regard to what is equitable for all depositors, including those with large accounts.
"This is in the governor's best interest," said Turkus. "The governor has his eye on September." Hughes is expected to run for the Democratic nomination for U.S. Senate in Maryland's September primary.
Kaplan, however, agreed with attorneys for the Maryland Deposit Insurance Fund, the state agency overseeing Old Court, who said the pay-back that would cut down on administrative costs by reducing the number of depositors. Arguments from the big depositors, said Kaplan, "are very emotional, but I don't believe they are correct."
Lawyers for former Old Court president Jeffrey Levitt and former Old Court director Dennis E. Guidice also were opposed because their clients are specifically excluded from the pay-back plan. They and other Old Court officials named in the state's $200 million suit against managers of the now-defunct thrift would not be permitted to withdraw funds under the plan.
The plan calls for the transfer of all accounts worth $5,000 or less to Maryland National Bank, where depositors could choose to withdraw their funds. Funds in those accounts total about $26.4 million.
Old Court's approximately 17,300 other customers have larger accounts that total $569 million. They will be permitted to withdraw $5,000 each in early April, and will then receive quarterly payments during a four-year period as the Maryland Deposit Insurance Fund liquidates Old Court's assets.
Old Court's IRA depositors, who number 2,401, will have their accounts transferred to Maryland National. MDIF attorney Martin Ellis said the largest of those accounts contains about $29,000.