story by Kim Souza
Where do bankers go to borrow money? A paper trail left by former Arvest exec Dennis Smiley Jr. indicates he went to his friends and family first – and possibly without their consent.
Not only did Smiley borrow money from a bank where his father 73-year-old Henry Dennis Smiley Sr., is chairman, he also co-borrowed with his dad on several occasions in a venture known as HDS Holdings, a revocable trust and jointly in both Smiley names, according to three recent counter claims filed in Benton County Circuit Court.
The senior Smiley through his counsel, the Hogue Law Firm in Fayetteville, has filed a response to the Bank of Fayetteville’s counter claim and request for judgment. The answer notes that Smiley Sr. denies borrowing money from the Bank of Fayetteville or guaranteeing loans as trustee on behalf of his son. In the answer, Smiley Sr. pleads the “affirmative defenses of fraud and statute of frauds.”
The defendant Smiley Sr. said he did not sign any of the subject loan documents. “Upon information and belief,” an individual other than Smiley Sr., signed his name without his knowledge. He said the documents were executed without any authority granted by him. Smiley adds that he gave no one the authorization to sign his name.
The Bank of Fayetteville had asked the court for a $42,000 default judgment against Smiley Sr., and a $215,000 judgment against the Trust in which Smiley Sr. is a trustee. Claiming fraud, Smiley Sr. asked the court to dismiss claims against himself, along with his counter defendants HDS Holdings and the Henry Dennis Smiley Revocable Trust, that we oversees as trustee.
Smiley Sr. recently told Arkansas Business he was brokenhearted about his son’s financial and legal troubles saying at the time he didn’t know what all had happened.
Delta Bank & Trust also filed loan papers with the Benton County Circuit Court that bore Smiley Sr.’s signature on a $245,126 note made Feb. 20. That loan’s first installment was due March 20, seven days after Smiley Jr. resigned his job at Arvest Bank. Smiley Sr. said in his response that he did not make or authorize the loan with Delta Bank & Trust, and the documents that bore his name were signed without his consent or knowledge.
It is now known that Arvest was contacted by multiple banks in recent weeks seeking payment for Smiley Jr.’s debts as he repeatedly pledged his Arvest bank stock as collateral. This and other suspicions led to Smiley’s resignation.
Arvest noted in its recent interpleading with the Benton County court that 20 banks were after Smiley Jr.’s stock plan assets which should have never been pledged as collateral.
To date, five of those banks have filed counter-complaints and or defendant responses with Benton County Circuit Court.