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Utah based SunFirst Bank, which has been widely associated with processing financial transactions with online gambling organizations has failed.
The Federal Deposit Insurance Corporation (FDIC) has announced that most of SunFirst's deposits will be transferred to Cache Valley Bank, although it will be retaining roughly $15 million in deposits that "may be subject to external litigation involving SunFirst Bank." The accounts holding that money were frozen before the bank failed.
SunFirst is Utah's first bank to fail this year. At the end of September, SunFirst held $198.1 million in assets along with $169.1 million in deposits. Many of the funds within the bank's system will be transferred to Cache Valley, who is assuming around $177 million of SunFirst's assets. The FDIC will be absorbing $49.7 million in costs.
SunFirst Bank has had a rough year, as it was ordered to stop conducting business with Jeremy Johnson, a major online poker player. It was alleged that Johnson had conducted illegal financial acts which involved fake government grants and unauthorized monthly debits to the tune of $289 million.
Currently, SunFirst Vice Chairman John Campos is facing federal charges, accused of processing internet poker transactions, along with businessman Chad Elie.