(Adds allegations and settlement details, comment from bank and lawyer for former CEO, bylines)
By Jonathan Stempel and Ismail Shakil
Aug 16 (Reuters) - A Maryland bank agreed to pay about $22.9 million to settle charges by two U.S. regulators that it failed to disclose tens of millions of dollars of loans to family trusts belonging to its former longtime chief executive officer.
Eagle Bancorp Inc, of Bethesda, Maryland, will pay $19.5 million in civil fines and more than $3.35 million in disgorgement and interest to settle with the Federal Reserve Board and the Securities and Exchange Commission (SEC), the regulators said on Tuesday.
Ronald Paul, 66, of Potomac, Maryland, an Eagle founder who was CEO from 1997 until he retired in 2019, agreed to pay about $521,000, of which $390,000 represented civil fines. The Fed permanently banned him from working in the banking industry.
Neither Eagle nor Paul admitted or denied wrongdoing.
Both were pleased to put the matter behind them, according to separate statements from Eagle CEO Susan Riel and Lance Wade, a lawyer for Paul.
Wade also said the SEC consent order against Eagle included allegations concerning Paul that were "false, misleading, and unsupported by credible evidence," and Paul would have disputed them had the SEC included them in its action against him.
Regulators accused Eagle of having from 2015 to 2018 extended approximately $90 million of credit to entities that Paul owned or controlled, without disclosing it to investors in periodic reports and proxy statements.
The SEC also said that after short seller Aurelius Value in December 2017 questioned the loans to Paul's trusts, Eagle and Paul falsely assured investors that the loans were proper.
"Adequate disclosures of related party transactions are essential to enable investors to evaluate an issuer's corporate governance," Sanjay Wadhwa, deputy director of the SEC enforcement division, said in a statement.
Eagle has 20 banking offices in Washington, D.C. and suburban Maryland and Virginia. (Reporting by Jonathan Stempel in New York and Ismail Shakil in Ottawa; editing by Richard Pullin)