Julio Herrera Velutini, seen here with Luciano (Source: House of Herrera)
Bancrédito Holding Corporation submits Verified Shareholder Derivative Complaint against the Bank’s former President, CEO and former member of the Company’s Board of Directors, and one of the Bank’s outside counsel.
This derivative action is brought against Defendant Frances Díaz, the Bank’s former President, CEO and former member of the Company’s Board of Directors, and Defendant María A. Domínguez-Victoriano, one of the Bank’s outside counsel seeking to remedy their breach of fiduciary duties during the period beginning September 23, 2021, through the present
London | 12:22 PM
02 May 2023
Lawsuit Claims Bancredito International Bank President and Outside Counsel Breached Duties, Causing Harm.
The shareholder, BCH, has taken legal action on behalf of the Bank to address the defendants' breach of fiduciary duties and unjust enrichment. It is alleged that Díaz and Domínguez violated their obligations of loyalty, care, and good faith during a specific period, leading to significant economic damages. The Bank is currently undergoing receivership and liquidation due to these alleged wrongdoings.
Allegations against Frances Díaz
Frances Díaz, who served as the Bank's President, CEO, and Board member, is accused of various breaches. These include failing to disclose a criminal investigation while working for the Bank, using the Bank's policies to benefit herself, and misappropriating its funds.
Allegations against María A. Domínguez-Victoriano
María A. Domínguez-Victoriano, an outside counsel for the Bank, is also accused of breaching her duties. Despite not being licensed to practice law in Puerto Rico, she allegedly provided legal advice on matters related to Puerto Rico laws. She represented Díaz in a way that was adverse to the Bank. It is further claimed that she used confidential information acquired through her representation of the Bank to benefit Díaz at the Bank's expense.
Jurisdiction and Venue
The lawsuit asserts that the court has the authority to handle the case and that it has jurisdiction over the defendants. The venue is deemed appropriate because the defendants either reside or maintain executive offices within the district, and the alleged wrongful acts occurred there.
BCH, a corporation registered in New York, is the sole shareholder initiating the lawsuit. Bancrédito International Bank & Trust Corporation, the Bank itself, is named as a nominal defendant. Frances Díaz, the former President and CEO, and María A. Domínguez-Victoriano, an outside counsel, are defendants in the lawsuit. DMRA Law LLC, a limited liability company, is also listed as a defendant.
Derivative and Pre-Suit Demand Allegations
BCH has brought the lawsuit as a derivative action on behalf of the Bank, seeking to address the defendants' breach of fiduciary duties and unjust enrichment. The shareholder claims that the Bank has suffered and will continue to suffer harm due to the defendant's actions.
The lawsuit includes three counts. Count I alleged a breach of fiduciary duty, specifically regarding good faith and loyalty, against Díaz and Domínguez. Count II claims unjust enrichment against DMRA, Domínguez, and Díaz. Count III asserts a claim for collection of money against Díaz concerning a Key Retention Agreement.
Prayer for Relief
The shareholder requests several forms of relief from the court, including holding the defendants accountable for damages, implementing corporate governance reforms within the Bank, and awarding restitution and disgorgement of profits. Additionally, the shareholder seeks reimbursement for the costs and expenses associated with the lawsuit.
This lawsuit addresses the alleged breach of fiduciary duties by the former President and CEO of Bancrédito International Bank & Trust Corporation and an outside counsel. If the allegations are proven true, the defendant's actions could have significant implications for the Bank and its shareholders. As the legal proceedings progress, the court will determine the appropriate remedies to address the damages suffered by the Bank and its shareholders.
A recent lawsuit filed by a shareholder accuses Frances Díaz, the former President and CEO of Bancrédito International Bank & Trust Corporation, and María A. Domínguez-Victoriano, an outside counsel, of breaching their fiduciary duties. The lawsuit alleges that their actions have caused substantial harm to the Bank. Here's a breakdown of the allegations and the implications of the wrongdoing.