Bill Walton was at the top of Washington’s finance establishment when he ran Allied Capital Corp. and sat on the Riggs Bank board alongside the city’s titans. Then the trouble began.
Hedge fund manager David Einhorn accused Allied in 2002 of inflating the value of its holdings, sparking a fight that lasted years. A subsidiary that loaned to small businesses agreed to settle fraud claims with the Justice Department for $26.3 million in 2010, an executive went to prison and Allied, hobbled by the financial crisis, was sold. So was Riggs, after it was fined $16 million for helping former Chilean dictator Augusto Pinochet and Equatorial Guinea officials hide funds. A judge called the bank “a greedy corporate henchman.”