It’s been more than a year since Dennis Smiley resigned his post as Arvest Bank President for Benton County and the bank fraud scheme he pulled off around the state began to unravel.
In that time, Smiley has tied up some loose ends by selling the family home to partially satisfy three mortgages against it. The home in Pinnacle Country Club sold for $550,000. Arvest, holding first and third mortgages, received payment of $305,811. First Security, holding the second lien, was paid $216,702.
Also his wife, Cynthia, a co-borrower in many of the loans, successfully filed Chapter 7 bankruptcy protection with no objections from lenders were are still on the hook for roughly $4 million in loans made to the couple over the past few years – loans collateralized by a single retirement account valued at roughly $600,000.
Arvest Bank recently reopened three cases against Smiley following the automatic stay which put the cases on hold during the bankruptcy proceedings. Ironically, two of the loans were made to Smiley to benefit his wife’s business, Design for the Home, which was part of the now dismissed bankruptcy case.
Arvest has asked Benton County Circuit Court for judgments against Dennis Smiley for loans outstanding ($31,103) and ($59,616) made to Design for the Home. Another loan made to Smiley is also due to Arvest in the amount of $181,782, with interest accruing daily. These cases will be heard later.
Arvest is also engaged in the reopened interpleader case involving Signature Bank and First State Bank DeQueen. The two banks were not part of the 18-bank settlement Arvest reached last year with other lenders seeking payment from the same $600,000 retirement account collateral that was held by Arvest Bank and placed on deposit with the court.
The civil court has set a trial date of Dec. 15 for this interpleader case involving debts owed by Smiley.
Smiley, on the other hand, is reportedly close to reaching a plea agreement with federal prosecutors in the criminal fraud investigation that has taken place over the past year.
The City Wire spoke with a few experts in the legal community regarding the criminal probe who agreed that this case will likely not go before a grand jury. They say Smiley likely will enter a guilty plea with the court and proceed to sentencing following arraignment and the completion of a pre-sentencing report conducted by the Department of Justice. The criminal federal court dockets still do not show any charges have been filed against Smiley.
Insiders say based on federal sentencing guidelines that Smiley could face between 60 and 80 months of prison if he does plead guilty to bank fraud involving roughly $4 million in loans and losses for some 18 banks across the state. Other potential crimes that have been revealed in the ongoing civil suits include forgery and mail and wire fraud in conjunction with transmission of loan documents.
Legal experts say it will be interesting to see how the federal judge assigned to this case sticks to the sentencing guidelines, given the leniency shown throughout the sentences handed out in the Brandon Barber case, also a white collar crime involving area banks.
One other sticky point in the Smiley case is the number of victims, which include some 19 banks around the state. Legal experts say a federal prosecutor will want to ensure that any plea deal reached is done with no major objections from the victims.