McAllister was once president and CEO of Bank of Choice, formerly Greeley’s largest community bank. The bank failed due to insolvency and was sold to Greenwood Village-based NBH Holdings in 2011. McAllister served as head of the bank from 2003 through 2010.
In the stipulation, McAllister neither admits nor denies the allegations against him. The agreement was approved by Denver District Judge J. Eric Elliff Thursday, according to attorney Martin Berliner, who represents McAllister.
Berliner said the settlement is a “relief” for his client. His trial was to have begun in February.
The case stems from a preferred stock offering of bank shares in 2008 that regulators claim was offered improperly to depositors of the bank. The depositors cashed in certificates of deposit to buy the preferred shares, which became worthless once the bank failed.
McAllister maintained that the attorney responsible for registering the offering with the state failed to file the correct paperwork and, in addition, that bank officers who sold the securities to the depositors also acted in error. The depositors in the case lost more than $500,000.
As part of the permanent injunction, McAllister is barred from suggesting the case “is without factual basis,” but Berliner said the injunction does not bar McAllister from the securities industry.
Colorado Securities Commissioner Fred Joseph, however, said that McAllister would likely never be granted a license to work in the securities industry in the state.
“Anyone subject to a permanent injunction can apply (for a license),” Joseph said, “but the chances of him getting a license are very slim.”