LITTLE ROCK — Samuel Anderson Jr. of Hot Springs, former chief executive officer of a Hot Springs energy business, was ordered Wednesday to pay restitution and fines totaling more than $1.8 million for his part in a failed investment deal that affected more than 50 investors.
Pulaski County Circuit Judge Alice Gray made the ruling against Anderson, who had been sued by the Arkansas Securities Department for selling unregistered securities.
Anderson, who represented himself in Gray’s court, was the head of PRE LLC, also known as Phoenix Renewable Energy, which claimed in 2009 that it would build a $110 million wood pellet plant in Camden and hire 35 to 40 employees.
Securities attorney Campbell McLaurin asked Gray to enter a default judgment for restitution of almost $1.1 million invested by 50 investors in Phoenix Renewable. In addition, McLaurin sought about $450,000 for three other investors.
Gray agreed to order Anderson to pay the $1.55 million in restitution plus $6,500 in fines for each of 50 sales of unregistered securities, representing a violation of the state’s securities laws that carries a potential fine of up to $10,000 each.
Anderson argued that he was not significantly involved in the company because of his poor health and was seldom in the company’s office. After the hearing, Anderson said he has been disabled and at home for more than a decade and has had numerous surgeries on his back.
“I suspect I’m as victimized in this case as anybody else,” Anderson said.
McLaurin argued that Anderson used some of the money paid by investors in Phoenix Renewable for his personal use, to pay the loan on his Jaguar, purchase another vehicle, make purchases at Sam’s Club and Kroger and withdraw more than $22,000 in cash.
Last year, Stephen Ray Walker, the firm’s chief financial officer, agreed to pay $375,000 in fines to the Securities Department for selling unregistered securities but admitted no wrongdoing.
Phoenix Renewable Energy was a scam from the beginning, McLaurin said.
“It was a scam that had a veil of legitimacy to it,” McLaurin said. “They did have some employees for a time, but at the end of the day, [Anderson and Walker] were pulling plenty of money out of there for themselves.”
The state did not offer any incentives to Phoenix Renewable, a spokesman for the Arkansas Economic Development Commission has said.
Anderson was convicted Feb. 28, 1985, in federal court at Hot Springs of two counts of conspiring to possess cocaine with intent to deliver and one count of distributing cocaine. Anderson was charged with conspiring with Roger Clinton, the younger brother of then-Gov. Bill Clinton, to distribute cocaine from November 1983 through February 1984 and conspiring with Maurice Rodriguez to sell the drug from May 1984 through June 1984.
He was sentenced to two years in prison and fined $3,000.
Business, Pages 27 on 01/24/2013