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Heritage Oaks Bank reports accounting error

March 26, 2010

By KAREN VELIE

Paso Robles-based Heritage Oaks Bancorp blames accounting errors for a recently discovered additional $1.8 million in losses for the fourth quarter of 2009. [RTTNews]

The parent company of Heritage Oaks Bank now reports a fourth quarter net loss of $3.4 million or about .48 cents a share, compared to a previously reported loss of $1.6 million or about .26 cents a share.

The additional loss increases the 2008 net loss of the bank from $5.2 million, or .81 cents a share, to $7 million or $1.04 a share.

Earlier this month, federal bank regulators took enforcement action against the bank, which operates 15 branches in San Luis Obispo and Santa Barbara counties, and banned the company from paying dividends or incurring debt as part of a written agreement between the company and the Federal Reserve Bank of San Francisco.

On March 12, in order to increase its capital and strengthen its balance sheet, the bank raised proceeds of approximately $60 million through the sale of securities.

In March 2009, while awaiting $21 million in federal bailout monies, members of the bank’s board of directors and a few high ranking employees were in Hawaii  enjoying their annual trip to the islands.


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I remember our dear friends Miller and Brard from Hurst took a Hawaiian holiday as their company was collapsing, is this what failures do?


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I mentioned the last time Heritage came up a month ago, going all the way back to the eighties and the Block and Bower debacle and now fast forward to Gearhart and Miller and now these last couple months, what in the hell is this bank still doing being opened???


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———————–Problems with Heritage Oaks Banks accounting of their “Loan Transaction History” Is this normal for California Banks?


Sent: Friday, October 16, 2009 5:07 PM

To: ‘lward@heritageoaksbank.com’

Cc: ‘wraver@heritageoaksbank.com’; ‘mmiller@heritageoaksbank.com’

Subject: RE: Payoff


Dear Mr. Ward


William Raver, has not responded to my E-Mail to him yesterday as seen below. Please see that he receives a copy of these mistakes made by Heritage Oaks Bank!


I have paid Mr. Greg Chilina and Paul DeLine’s, Extortion fee of $868.61 with my previous certified check payment of $2,300.00 but again I am asking that all of my previous questions of Heritage Oaks Bank be answered immediately! I will expect this extortion fee by Heritage Oaks Banks Employees to be applied immediately to reducing my principal on my Loan! You have had a chance to read Senior Vice President Paul DeLine letter on June 10, 2009 and are well aware of my payment to Heritage Oaks Bank on June 12, 2009 as requested by Heritage Oaks Bank!


I have noticed from the Heritage Oaks Banks excel spread sheets provided by Heritage Oaks Bank other mistakes prior to January 2, 2008 which is water under the bridge from Heritage Oaks Banks (Change in Terms signed contract Agreement dated January 2, 2008) However these mistakes made by Heritage Oaks Bank should be noted! As Senior Vice President Paul DeLine and Greg Chilina believe that Heritage Oaks Bank has a bucket of interest attached to my loan! Could you please explain this bucket of interest?


Heritage Oaks Bank in 2004 in their spread sheet does not reduce my principal paid every month! Can you explain this?

Heritage Oaks Bank in 2005 in their spread sheet does not reduce my principal paid every month! Can you explain this?

Heritage Oaks Bank from April 5, 2002 to September 17, 2002 does not show any principal paid to loan except $19.57?

Heritage Oaks Bank from February 18, 2003 to May 12, 2002 does not show any principal paid to loan except $765.98 on 5/12/2003?

Heritage Oaks Bank does not apply any principal with my payment June17, 2003

Heritage Oaks Bank does not apply any principal with my payment July 22, 2003

Heritage Oaks Bank does not apply any principal with my payment December 12, 2003

Heritage Oaks Bank does not apply any principal with my payment February 13, 2004

Heritage Oaks Bank does not apply any principal with my payment July 22, 2003

Heritage Oaks Bank on April 16, 2004 only applies the additional principal of $67.86 to my loan?

Heritage Oaks Bank on June 1, 2004 only applies the additional principal of $67.86 to my loan?


Heritage Oaks Bank on June 15, 2004 only applies the additional principal of $67.86 to my loan?

Heritage Oaks Bank does not apply any principal with my payment August 3, 2004?

Heritage Oaks Bank on November 24, 2004 only applies the additional principal of $67.86 to my loan?

Heritage Oaks Bank on December 20, 2004 only applies the additional principal of $67.86 to my loan on December 21, 2004?

Heritage Oaks Bank on December 31, 2004 only applies the additional principal of $67.86 to my loan on January 3, 2005?

Heritage Oaks Bank does not apply any principal with my payment February 3, 2005?

Heritage Oaks Bank on March 18, 2005 only applies the additional principal of $67.86 to my loan?

Heritage Oaks Bank does not apply any principal with my payment April 25, 2005?

Heritage Oaks Bank on May 20, 2005 only applies the additional principal of $67.86 to my loan?

Heritage Oaks Bank on June 24, 2005 only applies the additional principal of $67.86 to my loan?

Heritage Oaks Bank on 7/25/2005 does not show additional principal paid to loan or principal?

Heritage Oaks Bank on 5/12/2006 does not show additional principal paid to loan or principal?

Heritage Oaks Bank on 6/30/2006 does not show additional principal paid to loan or principal?

Heritage Oaks Bank on 9/8/2006 does not show additional principal paid to loan or principal?

Heritage Oaks Bank on 10/16/2006 does not show additional principal paid to loan or principal?

Heritage Oaks Bank does not apply any of my payment of $2,232.14 on November 16, 2006 to my loan?

Heritage Oaks Bank on November 16, 2006 only applies the additional principal of $67.86 to my loan?

Heritage Oaks Bank on November 16, 2006 only applies the additional principal of $67.86 to my loan?


Heritage Oaks Bank payment on 5/22/2007 does not show additional principal paid to loan?

Heritage Oaks Bank does not apply any principal with my payment May 24, 2007. Why?

Heritage Oaks Bank does not apply any principal with my payment May 25, 2007. Why?

Heritage Oaks Bank from June 8, 2009-December 28, 2009 began applying all of my payments to principal. I have no questions regarding this. Thank You!

Heritage Oaks Bank again on January 7 2008 applied all of my payment to principal is this why——See below questions

Heritage Oaks Bank on 3/28/08 does not show principal paid to loan?

Heritage Oaks Bank on 5/5/08 does not show principal paid to loan?

Heritage Oaks Bank on 5/27/08 does not show principal paid to loan?

Heritage Oaks Bank on 7/2//08 does not show principal paid to loan?

Heritage Oaks Bank on 7/31/08 does not show principal paid to loan?

Heritage Oaks Bank on 9/4/08 does not show principal paid to loan?

Heritage Oaks Bank on 9/29/08 does not show principal paid to loan?

Heritage Oaks Bank on 10/15/08 does not show principal paid to loan?

Heritage Oaks Bank on 11/28/08 does not show principal paid to loan?


Heritage Oaks Bank on 1/2/09 does not show principal paid to loan?

Heritage Oaks Bank on 2/5/09 does not show principal paid to loan?

Heritage Oaks Bank on 5/1/2009 does not show additional principal of $73.22 paid to loan or principal? What happened to this money?

Heritage Oaks Bank on 6/2/2009 does not show additional principal of $73.22 paid to loan or principal? What Happened to this Money?”


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Unfortunately, yes it is typical of most banks. According to your transaction history, there are regular payments you missed. When this happens interest and penalties will accrue at which point the customer begins to lose control of how their payments are applied. In addition you can accrue interest on the penalties. It can be very difficult for many consumers to accurately track their credit balances. Whether this is fair or not is up for debate, but it is part of the terms of the loan you agreed to. I understand it can seem maddening. I just tried to pay off a credit card on which I kept a balance for a few months and it was like playing whack-a-mole, another few dollars would keep popping up.


“Be careful what you ask for, because you just may get it” is a cliche that applies to the apparent availability of capital which results from having fractional reserve banking and fiat money. The best way to get what you want, even if it is pursuing capitalist opportunities, is and always has been to save the money until you can afford it. This perspective may seem to limit growth possibilities and it can be frustrating to watch the rest of the world around you advance through the use of credit, but it results in growth that is real and solid.


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————MKaney, Thank you for you thoughts, however check out how Heritage Oaks Bank began applying my principal to my loan! i don’t see how this could be legal?


9/17/2002

PRINCIPAL PAYMENT


$19.57

$299,980.43


9/17/2002

INTEREST PAYMENT


$2,212.57

$300,000.00


8/15/2002

INTEREST PAYMENT


$2,232.14

$300,000.00


7/15/2002

INTEREST PAYMENT


$2,232.14

$300,000.00


6/14/2002

INTEREST PAYMENT


$2,232.14

$300,000.00


5/13/2002

INTEREST PAYMENT


$2,232.14

$300,000.00


4/5/2002

INTEREST PAYMENT


$2,232.14

$300,000.00


3/4/2002

PRINCIPAL ADVANCE

$120,249.29


$300,000.00


3/4/2002

INC ACCR INTEREST

$80.16


$179,750.71


3/4/2002

PRINCIPAL ADVANCE

$179,750.71


$179,750.71


3/4/2002

INC ACCR INTEREST

$159.77


$0.00


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How did you manage to accrue interest on the same day you received the principal?


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————–Good Question: I wonder if other Heritage Oaks Bank customers are having the same type of problems with Heritage Oaks Bank in their “Loan Transaction History’s”?


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Yes, I am having problems in getting Heritage Oaks Bank to explain why they are not applying principal to my loan.


Is this normal for FDIC Insured Banks to not be able to explain their “Loan Transaction Historys”? Please review this E-Mail from Heritage Oaks Bank!


From: Greg J. Chilina [mailto:gchilina@heritageoaksbank.com]

Sent: Monday, March 29, 2010 8:06 AM

To: Bill Bookout

Subject: RE: Transaction History


Mr. Bookout,


As previously discussed by you and I and as directed by Bill Raver in previous emails, please correspond with Heritage Oaks Bank via letter. Once again, I am your primary contact for any questions you may have regarding your loan. Please submit a request to the address listed in the signature just below. Have a great week!


Greg Chilina

VP/Special Assets Department Manager

Heritage Oaks Bank

545 Twelfth Street

Paso Robles, California 93446

805.369.5194

Fax: 805.238.6257

http://www.heritageoaksbank.com


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Thank you new investors for purchasing $60M of our convertibles and preferreds, although existing shareholders were diluted from here to Hiroshima. Oh, did we forget to mention that pesky little “accounting error”? Awful sorry about that old chaps, but not to worry though as 70% of our loan portfolio is tied up in commercial real estate, so that’s ok then. Everyone knows how solid that market is.


Banking is a great business – for bankers. For the rest of us, it is nothing less then the greatest skimming operation the world has ever seen. And while we are in the midst of the greatest, most expensive king-hell credit work out in human history, our leaders have decided to simply let the banks keep the money they have stolen and that it is a good idea to rob from our children, grandchildren and great grandchildren in a an attempt to execute a “soft landing”.


The result will be anything but a soft landing, yet the debt will remain – to be paid in full by future zombie generations.


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Oh Sheeeez, So on March 12 they raised $60 million and on March 24 they reported that the actual investment share value had been ‘accidentally’ over inflated by 100%? That is preposterous! Call it corruption or incompetence there is no excuse for this. This country has become a joke, the laughing stock of the planet, damn near every oversight agency does nothing but drop the ball at every turn. They are all worthless. It’s at the point where the American people need overseers of the overseers and then more to oversee those overseers. Forget the war on drugs, put the funding into a war on white collar crime and build a great big JAIL HOUSE for hand shakers.

While the drug companies continue to work on all the anti-depressant medications they might want to invest some research into an anti-sociopath concoction.


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Amen!!!!!!!!!!!!!!!!!!!!!!!!!


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