Editorial : Transparency overlooked
Transparency is a hot political, business, social, and cultural concept, not only nationally but here at home. Unhappily, it's a concept to which leaders and participants in each of these environments and every geographic region genuflect eagerly but practice only reluctantly.
Readers will remember the difficulty this newspaper had prying financial information from the Dukes County treasurer, the county manager, and the county commissioners about confusion in the county's accounting and budgeting. When that information was ultimately understood by county officials and made available through Times reporting to the county's constituents, we discovered that the county had discovered — surprise — a total surplus of $572,726, at a time when county government is shifting the cost of county programs to Island towns, struggling to fund the few remaining services it provides for Dukes County and maintain the county courthouse.
"What stands out about FY12," Walter Vail, a retired banker, an Oak Bluffs selectman, and a member of the county budget advisory board said, "there are some items in there that might have been budgeted better, and we would have discovered a surplus a whole lot sooner. For FY11 and FY10, I don't understand why that's just coming to light now. Those audits were done a long time ago. How come we didn't know that back in early 2011? It's awfully late to get that information."
Late indeed, and how come we, that is you, didn't know it?
Or, consider social media. In the social media ecosystem, transparency has become a one-way thoroughfare. Whatever you post on Facebook, Instagram, Twitter, etc. becomes instantly transparent web-wide. How these social web communication companies will use this vast trove of your information is less transparently explained. They will use and reuse it to monetize your life and profit from the experience.
This week, we report on the Federal Deposit Insurance Corporation's (FDIC) order concerning Christopher A. Wells, the former Martha's Vineyard Savings Bank president and chief executive officer who resigned from the Island's largest Island-based financial institution a year ago. The FDIC order, to which Mr. Wells agreed, found him guilty of serious violations of banking regulations, and personal dishonesty. The federal regulatory agency prohibited Mr. Wells from working in any FDIC-insured institution in the future, without regulatory approval.
Martha's Vineyard Savings Bank, the combination of Dukes County Savings Bank and Martha's Vineyard Cooperative Bank, the two largest locally owned banks on the Vineyard, is commonly regarded as a hometown, neighborhood, everyday Islanders' go-to bank for mortgages, equity lines, and small business financing.
Mr. Wells's departure in May a year ago was not accompanied by even the most perfunctory explanation by the bank's directors of the reason or any suggestion that federal regulatory authorities were involved.
The FDIC order was published on February 28, 2013, more than a month ago. It was not accompanied by an announcement by the bank directors of the regulatory action, even though the order includes language common to such documents that alerts depositors that "...the bank has suffered or will probably suffer financial loss or other damage, [and that] the interests of the Bank's depositors have been or could be prejudiced...," even though there is no indication that further regulatory action concerning the bank is in the wings.
This week, we also report what the bank saw no reason to announce, namely the retirement of Richard Leonard, the longtime president of the Martha's Vineyard Cooperative Bank, a highly regarded, exceptionally civic-minded Islander-businessman.
Closely held institutions such as M.V. Savings do not have the public disclosure and transparency requirements that apply to huge public corporations and bank holding companies. Nevertheless, such a vitally important, local financial mainstay as M.V. Savings might have served itself better by communicating with its customers and depositors who deserve timely and direct communication about the goings-on in what they regard as their bank.