Dr. Dipak Desai, majority owner of the Endoscopy Center of Southern Nevada that closed earlier this year, was among the founders and organizing board members of the Bank of George.
The clinic was shut down following disclosures in February that clinics reused syringes on infected patients and contaminated single-use vials of medicine. Officials have identified six individuals who they believe contracted hepatitis C during visits to Desai's center at 700 Shadow Lane.
In February, the Southern Nevada Health District sent notices to 40,000 individuals, urging them to be tested for hepatitis and HIV, the virus that leads to AIDS.
Desai's departure from Bank of George preceded stories about his clinic, however. The doctor resigned from the board in November, just a month after the institution opened, bank Chief Executive Officer Diane Fearon said.
Fearon confirmed that Desai served on the bank's board but declined to give the reason for his resignation. She said policy prohibited her from disclosing the amount of money he invested in the privately held community bank.
Desai's attorney, Richard Wright, declined to comment on the reason for his client's resignation from the bank board.
A banker, speaking on condition of anonymity, said Desai earlier served as a director at Nevada First Bank and is remembered for opposing pay raises for executives at Nevada First. Western Alliance Bancorporation acquired Nevada First in 2006.
A search of Web sites for local community banks and Nevada corporations uncovered no financial institutions that now listed Desai as a director.
It appears unlikely that Desai has any leadership roles with financial institutions in Nevada, partly because of his notoriety, but also because he is a director of Nevada Mutual Insurance Co., which insures doctors against medical liability claims.
Banks select directors based on their financial responsibility, acumen and good reputation, according to another banker who spoke anonymously.
When a director becomes the subject of negative publicity, he or she often will leave the bank board. That's what happened with David Keys, former CEO of Southwest Exchange.
Keys joined the board of Henderson-based Silver State Bancorp in 2007 only to resign a few days later when Southwest Exchange failed while owing clients $95 million.
Bankers also say they would not knowingly allow an individual to serve on their boards if they knew the person was on a competing bank's board because it would present a conflict of interest.
George Burns, commissioner of the Financial Institutions Division, said the division and the Federal Deposit Insurance Corp. prohibit directors from serving on the board of more than one community bank competing in the same area.
Contact reporter John G. Edwards at firstname.lastname@example.org or 702-383-0420.