The chairman of the state Senate Banking Committee, already the subject of lawsuits over a failed bank and bank debt, could lose a Forsyth County property to foreclosure.
State Sen. Jack Murphy, R-Cumming, owns a one-acre tract along Tribble Gap Road in downtown Cumming that has been listed for foreclosure on July 5, according to a legal notice published earlier this month in the Forsyth County News.
The loan was originally issued for about $228,000 by Integrity Bank of Alpharetta, which failed in 2008 and where the senator was once a director. Investors later bought the loan.
Murphy, in an email, said he acquired the property in 2005 with plans to build an office building. He said its value has since dropped to 35 percent of the purchase price.
“We contacted the attorneys for the investors who bought the property from the bank several weeks ago, and told them we had [an] offer from a buyer. They never responded,” Murphy said in the message. “I guess they thought foreclosing is the answer.
“The foreclosure [listing] was a complete surprise to us. We have turned it over to our attorneys, to see if they want to work something out.”
In January, Murphy was appointed chairman of the Senate panel that considers changes in banking law.
Later that month, the FDIC sued Murphy and seven other insiders of the failed Integrity Bank, accusing them of various breaches of fiduciary duties, including violations of state lending limits. The suit seeks more than $70 million in damages.
The Integrity co-defendants are fighting the suit. Murphy and three other Integrity insiders have cast blame at the FDIC for the bank’s failure.
The Atlanta Journal-Constitution reported in February that Murphy also had been sued in recent years for defaulting on other bank loans. Murphy has said he settled debts with one, an Alabama bank that said he owed about $50,000.
Atlanta’s Silverton Bank also sued Murphy, claiming he owed $193,000 on a loan. Silverton failed in 2009 and the case was taken over by the FDIC. Murphy has sought to dismiss the Silverton case.
That suit was moved last month from Forsyth County Superior Court to federal court in Atlanta, according to court records.
About the Author
