Two former executives of a San Francisco-based bank that received federal bailout money have pleaded not guilty to fraud charges.
Ebrahim Shabudin, the former CEO of United Commercial Bank, and former senior vice president Thomas Yu entered their pleas Thursday in federal court.
They’re the first executives of a bank that received funds from the Troubled Asset Relief Program, or TARP, to face criminal charges.
"Shabudin and Yu are the first senior executives of a TARP bank charged in connection with a scheme to defraud investors, which included the Treasury, and by extension the American taxpayer," acting TARP Special Inspector General Christy Romero said in a statement earlier this month when they were charged.
United Commercial Bank received $298 million in TARP money in 2008 during the height of the nation’s financial crisis. That money was lost when the bank was seized by regulators, shuttered and filed for bankruptcy the following year.
Shabudin and Yu are accused of hiding loan losses from investors and regulators.
They face up to 25 years in prison each, if convicted.