H. Dennis Smiley Jr., former president of Arvest Bank of Benton County, pleaded guilty to one count of bank fraud Tuesday in federal court in Fayetteville.
An investigation by the FBI showed the 52-year-old Rogers man pledged proceeds from his Arvest stock worth less than $500,000 to secure more than $4 million in loans from 20 banks.
The plea agreement states Smiley admitted to investigators he had been living beyond his means for at least 10 years. He also admitted he forged his father's signature on loan documents, had subordinates and other Arvest executives sign documents that falsely showed the stock collateral was unencumbered and used false financial statements to secure loans.
U.S. District Judge P.K. Holmes heard the case at the Western District's federal courthouse in Fayetteville. Acting U.S. Attorney Kenneth Elser served as prosecutor.
Smiley was released on a $10,000 bond.
Sentencing will be scheduled for a later date. Bank fraud carries a maximum penalty of 30 years in prison and a fine of $1 million.
W.H. Taylor, Smiley's attorney, had no comment after Tuesday's hearing.
Smiley agreed to pay full restitution to all banks he borrowed from and the government agreed not to pursue additional charges in the case.
The FBI began its investigation in March 2014 and Smiley resigned from Arvest on March 13, 2014.
Several banks sued Smiley claiming he defaulted on loans shortly after he resigned.
Smiley's guilty plea was related to a Delta Trust & Bank lawsuit that was filed March 25 claiming he defaulted on a $245,126 loan taken out Feb. 20.
Arvest filed a lawsuit in the spring listing 21 banks that could make claims for Smiley's Arvest shares.
A Nov. 3 hearing in Benton County Circuit Court will decide if Signature Bank will be allowed to go forward with a claim to settle a $200,000 loan to Smiley.
Three other civil suits remain active in circuit court.
Tim Tarvin, a University of Arkansas law professor, said statements made in the criminal case are public record and can be used in the civil cases, but Smiley also could recant.
"They remain separate cases," he said.
Smiley started his Arvest career in 1989 as a commercial loan officer at McIlroy Bank in Fayetteville. He served as president of Arvest Bank of Springdale from 2001 until April 2012 when he was named to the top Benton County post.
Jason Kincy, Arvest spokesman, said he could not comment on the criminal case because of pending civil litigation.
Business on 08/26/2015