Patton Boggs Client Wins Against Dominican Bank President

It wasn’t your typical delivery from Santa. “The case came to us on Christmas Eve 2005 with a phone call from the head of the bank’s audit committee,” recalls Patton Boggs partner Read McCaffrey of how Banco Dominicano del Progresso retained him. The bank, the third largest in the Dominican Republic, wanted to sue Pedro Castillo, its former president, for stealing millions of dollars from his employer over at least five years.

Last Wednesday, nearly three years after the phone call, a Miami-Dade County Circuit Court judge ruled in favor of McCaffrey’s client, finding that Castillo had converted bank funds for his own use, breached his fiduciary duty to the bank, defrauded the bank, and committed civil theft. In addition to condos in Florida and Vail, Colo., yachts, and even a helicopter, McCaffrey says Castillo also spent the bank’s money on “a horse in Michigan, and he rented a plane and had it specially outfitted to fly the horse from Michigan to the Dominican Republic.” McCaffrey calls that expenditure “the piece de la resistance.”

A criminal case against Castillo is ongoing in the Dominican Republic, but the bank came to Patton Boggs to file the civil suit in Florida, where Castillo lived and the fraudulent transactions took place. Castillo faces $80 million in damages in the civil case, according to the Nov. 26 judgment, and if found guilty in the Dominican Republic, he could get up to 25 years in prison.

McCaffrey, who led a team of D.C.-based Patton Boggs lawyers representing the bank and its affiliates. says the toughest part of litigating the case was sorting through all of the bank documents from Castillo’s tenure as president. “There were no records to speak of, just chaos,” says McCaffrey. He says Castillo had destroyed tapes of conversations with other bank employees in which he instructed them how to lie to board members. Patton Boggs turned to forensic specialists to salvage the tapes.

Castillo was most recently represented in the civil case by Florida lawyer Arturo Alvarez, though he previously relied on lawyers from South Florida firm Colson Hicks Eidson and from Squire, Sanders & Dempsey.