Ameris Bank (Photo: John Disney/ALM)

Ameris Bank secured an arbitration victory in a dispute with a former executive seeking millions of dollars under a termination agreement after he was fired when several fraudulent loans cropped up in a portfolio owned by a company he sold to Ameris. 

William Villari, the founder and former CEO of U.S. Premium Holding Co., said he was owed $15 million as part of a termination agreement he signed with Ameris, according to Ameris' lawyers at Covington & Burling.

Ameris reportedly paid more than $80 million to purchase all of U.S. Premium Holding's stock in January 2018.

 Villari was retained to oversee a division set up within Ameris, U.S. Premium Finance, which was geared toward originating and handling loans for individuals in the insurance business.

Ameris learned in May 2018 that several of the loans in the USPF portfolio were fraudulent,  according to its filings in a related case, and another limited liability company owned by Villari agreed to buy them back.

Ameris claimed Villari did not buy back all the problematic loans, and that he knew about them before the stock sale.

Ameris terminated Villare in November 2018, according to the arbitration order, asserting that it had done so for "good cause" as defined in the employment agreement. Villare filed a complaint the following month with the American Arbitration Association asserting that it was he, in fact, who terminated the agreement for "good reason," as defined in the agreement. 

There were five days of hearings before arbitrator Ken Menendez in Atlanta in August and October.

On Nov. 20, Mendez issued an award and order denying Villare's claims and upholding those of the bank.

"Ameris cites numerous acts or omissions by Mr. Villare, any one of which Ameris claims constituted sufficient basis for good cause termination of Mr. Villare's employment," Menendez wrote.

In addition to failing to disclose the fraud he knew of at least as early as Jan. 31, 2018, Villari also pursued a cannabis-related business against the "express orders" of his superiors and used another of his companies to compete with Ameris.

Villares himself admitted he did not immediately report the fraud because he "thought he could make the problem go away without alerting Ameris," the order said. 

That testimony "establishes that his failure to report the fraud immediately was willful misconduct in that it was intentionally done" and constituted a material breach of his fiduciary duties, it said.

Menendez ruled that Villare is not entitled to any additional compensation from Ameris.

Ameris' legal team is led by Covington partner Benjamin Razi and includes firm lawyers Michael Rosenthal, Marianna Jackson, Maggie Brennan and Laura Collins. Razi did not respond to requests for comment. 

Villares is represented by Steven Kushner of Fellows LaBriola in Atlanta, and Jonathan Feldman of Perlman, Bajandas, Yevoli & Albright in Miami. Kushner said he did not have permission to discuss the case. 

The arbitration award is only part of ongoing litigation between Ameris and Villares. 

In January, Ameris sued Villare and a family trust for claims including fraud and breach of contract in DeKalb County. It has since been transferred to Fulton County Superior Court, where it remains pending.