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Jim McMahon, Former NFL Quarterback, Takes Another FDIC Hit After Lawsuit

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Jim McMahon (2008 file photo) ignored regulatory input and signed off on iffy loans without consideration, the FDIC says.
Jim McMahon (2008 file photo) ignored regulatory input and signed off on iffy loans without consideration, the FDIC says.

The government blitzed Jim McMahon with a lawsuit in March to recover $104 million from a bank the former NFL quarterback co-directed. Now the FDIC is moving in for the sack.

The agency last week filed more papers ripping the Chicago Bears' Super Bowl-winning quarterback, several news outlets reported Tuesday. The FDIC said McMahon scrambled to avoid accountability while the Broadway Bank in Chicago made 17 bad loans, deals that contributed to the bank's closing in 2010.

"Defendant McMahon’s conduct is a paradigm case for director negligence,” the feds wrote in a motion published by the Chicago Sun-Times. “He appears to have approved loans he was told to approve without questioning. He received critical regulatory reports but did nothing in response. He did not read bank status reports; he missed many meetings."

Prosecutors continued: "There is no substitute for the disciplined work required to be a responsible bank director. This is something that McMahon does not acknowledge or appear to understand.”

The suit also includes six other Broadway Bank board members and two bank executives. The bank was operated by the family of Alexi Giannoulias, a former Illinois state Treasurer who made a losing bid for President Barack Obama's old U.S. Senate seat.

McMahon has said he has done nothing wrong.

McMahon joins former Minnesota Vikings tight end Stu Voigt as an ex-footballer who ran afoul of the FDIC, according to American Banker. The agency fined Voigt $125,000 for improper loans when he chaired the First Commercial Bank of Bloomington, Minn. Now Voigt is under criminal investigation for bank and wire fraud, the Minneapolis Star-Tribune reported in March.

McMahon, 52, helped guide the Bears to their only Super Bowl title, after the 1985 regular season. He is now one of hundreds of former players behind a lawsuit that accuses the NFL of concealing the long-term effects of concussions. McMahon says his short-term memory is fading.

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