Five years after unsuccessfully targeting two prominent Miami figures — one a banker, the other a lawyer — in separate cases, a Justice Department prosecutor faces a July disciplinary trial by Maryland Bar regulators.
John W. Sellers left the Justice Department in 2010 amid an internal probe concluding that he committed “reckless” misconduct in a money-laundering case against Miami-based American Express Bank International, which was headed by banker Sergio Masvidal.
Masvidal, who says he lost his ability to continue his banking career in 2007 because of Sellers’ actions, won a rare “name-clearing” letter from the Justice Department. Then the former bank chairman pursued an ethics complaint that led to recent misconduct charges against Sellers by the Maryland Bar, which licenses him to practice law.
“This is not about revenge; this is about justice,” Masvidal, 65, told The Miami Herald. “He never cared about what would happen to my family. If I had not saved some money, I’d be driving a cab today.”
Sellers’ attorney, James P. Nolan, of Annapolis, said his client “adamantly denies any violations” of the Maryland Bar’s rules. “Our position is Mr. Sellers acted within the scope of his authority at all times.”
The prosecution of Masvidal’s bank was not the first time Sellers misfired in a South Florida investigation. In 2008, Sellers filed money-laundering charges against respected Miami attorney Ben Kuehne, whose defense drew the support of hundreds of lawyers. The following year, the Justice Department dismissed the indictment after losing a critical appeal over the legal basis for the case.
Masvidal, who was not criminally charged in the American Express case, said his quest to regain his good name has entailed bruising legal battles with the Justice Department — with Sellers at the center of it all.
In a 2010 civil settlement with Masvidal, the Justice Department admitted that the agency violated policy when it secretly joined forces with American Express to ensure that he would be effectively fired following the prosecution of the company’s international banking subsidiary in Miami. Sellers was not mentioned by name in the department’s settlement letter to Masvidal.
In 2007, Sellers crafted the secret side deal to the Justice Department’s official criminal settlement with American Express Bank International over its violations of anti-money laundering reporting laws. Under a deferred prosecution agreement to avoid conviction, American Express had to pay the government $65 million for its lax enforcement of compliance laws aimed at flagging drug proceeds and other tainted bank deposits.
The side agreement — an August 2007 letter signed by Sellers and a major New York law firm representing American Express — was never disclosed to Masvidal, his colleague, bank president Simon E. Amich, or U.S. District Judge William Zloch in Fort Lauderdale, who approved the deferred prosecution agreement.
In his lawsuit, Masvidal said he soon discovered that American Express — concerned about being prosecuted while selling the international banking subsidiary — secretly gave veto power to the Justice Department to decide whether he and the president could remain as employees under any circumstances. In September 2007, the British company Standard Chartered bought American Express Bank International for $823 million, but Masvidal and his colleague were not retained.