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who didn't get named and who received immunity from prosecution as
those who did jail time.
Locke also was fighting allegations of bankruptcy fraud, and
Collins was getting sanctioned by securities regulators.
Lasater, who had bought out Collins and Locke, sold the firm a few
weeks ahead of the indictments for $15.5 million to William
"Billy" McCord and Richard Gene Smith. The venture was renamed
United Capital Corp.
7 Roxanne and David Hamilton
Young and smart, Roxanne and David Hamilton were cutting a swath
through the Little Rock investment community on their way to the top. He
made senior vice president at Dean Witter Reynolds in four years. She
was a vice president in charge of trading hundreds of millions of
dollars in securities at First Commercial Bank.
But the party was over in June 1986, when First Commercial Bank
stumbled across a problem with a client's account. That began the
unraveling of a complicated fraud scheme by the couple, who were using
bank assets for their own trading activities.
How complicated? First Commercial claimed a $4 million loss at the
time, but the Hamiltons' activities also generated lots of profit
for the bank along the way as well. A final reckoning was an
accountant's nightmare.
Roxanne Hamilton, 27 and destined to give birth to her first child
in prison, was sentenced to 50 months, and David Hamilton, 29, was
sentenced to 40 months for bank and wire fraud.
8 Lynn Lloyd
High-flying CPA Lynn Lloyd set a new Arkansas record for personal
bankruptcy when he listed debts of $24 million in his Chapter 11 filing
in November 1986. His money troubles were compounded when perjury and
bankruptcy fraud crept aboard, for which he was convicted in December
1990 and sentenced to 41 months in prison.
At the time of his financial crash, Lloyd was majority owner of
Little Rock's Savers Federal Savings & Loan when it became
insolvent. His Lynxx Banking Corp., which secured loans to Pine
Bluff's FirstSouth and was taken over by federal regulators, owned
the $80 million Farmers & Merchants Bank of Rogers and the $60
million First National Bank of Bentonville.
Lloyd's Lambda International owned Little Rock Air Center,
which was sold to Midcoast Aviation for $3.5 million. Lloyd Arms Inc.
and Iver Johnson Arms of Jacksonville were two other Lloyd investments
that were liquidated.
His storyline of lawyers, guns and money reminded us that life
really does imitate art.
9 Reed, Weichern and Cox
The wheels of criminal justice were put in motion when federal
regulators declared FirstSouth of Pine Bluff insolvent in December 1986.
The crash of the $1.68 billion-asset public company was the
nation's largest savings and loan failure to date.
The case against Roderick Reed, FirstSouth's president, was
the first to reach resolution when he pied guilty to bank fraud in
October 1989 and was sentenced to 30 months in prison.
Howard Weichern, FirstSouth's chief executive officer, was
convicted of one count of bank fraud and conspiracy in October 1990 and
sentenced to four years in prison.
Harley Cox, general counsel for FirstSouth and a board member, was
convicted on 15 counts of making false statements and taking other
action to conceal the true financial condition of the thrift from its
board and from regulators.
Cox was sentenced to four years in prison in August 1991 but
received a pardon in January 2001, part of the roster signed the day
before President Bill Clinton left office.
Much of the investigation centered on FirstSouth's Texas real
estate investments that were listed as loans.
10 Karl Bernhardt
Ford-New Holland Inc. landed a $1.2 million judgment against Karl
Bernhardt in January 1990, but tracking down the globe-trotting
Bernhardt and collecting the judgment was another matter.
Bernhardt turned Twin City Ford Tractor Inc., with lots in North
Little Rock and Alexander, into the largest dealership in North America
through creative use of price breaks from Ford. Example: Bid on state
contracts with volume discount prices, agree to buy back the equipment
at the original cost after one year and resell it at a higher but still
below-market price for good used equipment.
Ford decided Bernhardt was breaking the rules. Bernhardt responded
by abandoning the dealership in June 1987, taking $605,000 of his
"cash equity" when he returned to his native Germany. When
Ford finally tracked him down there to serve court papers, Bernhardt
relocated to Costa Rica.
that seemed to come out of nowhere with reported sales of $648 million
in 1992.
Except for his home office, CrossParex operations were said to be
based in Panama on 2,000 acres Whitlow owned and on which he harvested
cut flowers sold in Europe, Central America, South America, Mexico,
allegedly left two sacked and pillaged bakery projects in his wake.
25 Frank Whitbeck Jr.
Financial cracks began showing in Frank Whitbeck Jr.'s world
in 2002 when we noted a growing line of disgruntled creditors, from
bankers holding past-due loans totaling tens of thousands of dollars to
retailers owed a few hundred dollars.
The money woes escalated to seven digits in September 2003 when
Metropolitan National Bank of Little Rock filed a $4.5 million
foreclosure suit against the Little Rock businessman and his Winrock
Grass Farm.
Events turned toward the criminal after the state Insurance
Department seized Whitbeck's Signature Life Insurance Co. of
America. Ensuing actions revealed that he managed Signature Life to the
point of insolvency through a bookkeeping charade of unsecured IOUs
masquerading as real estate loans.
Whitbeck began serving a six-year sentence in December after
pleading guilty to one count of mail fraud. The sale of his country club
home helped bring him current on his delinquent $3.7 million settlement
with insurance regulators.
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