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FAYETTEVILLE — Payday lender Robert A. Srygley of Fayetteville loaned then-legislator Jon Woods $35,000 in two installments in late 2011 and early 2012, he testified on Thursday.

Srygley, past president of the Arkansas Check Cashers Association, testified that he didn’t know Woods had introduced legislation in 2011 to benefit payday lending or that he would introduce another bill to benefit lenders in 2013. Woods was a House member in 2011 who began service in the Senate in 2013.

“I don’t think anything came of it because I would have known if it passed,” Srygley said during cross-examination when shown a copy of House bill 1572 by Woods on payday lending. The bill would have allowed lenders of loans under $5,000 to charge fees to borrowers, including 5 percent for late payments, $25 for a bounced check and an unspecified amount for officially recording documents related to the loan. The fees wouldn’t be considered interest, the bill said.

Srygley also said he never heard of Senate Bill 900 of 2013 by Woods. The bill, which died when the General Assembly adjourned, would have allowed the Legislature to set the maximum interest rate on loans. Then-Arkansas Attorney General Dustin McDaniel described it at the time as an attempt to restore payday lending in Arkansas.

Arkansas voters approved a 17 percent cap on annual interest rates in 2010.

Srygley also made a campaign contribution to Woods of $2,000 on April 9, 2012, he confirmed.

Srygley was the first witness called by Woods’ defense. He loaned Woods $30,000 on Sept. 15, 2011, according to his testimony and check copies introduced as evidence. Srygley testified he expected repayment in three months, but did not get it until Oct. 1, 2013.

The $30,000 loan was for Woods’ expected campaign expenses, Srygley testified. Woods successfully challenged incumbent Sen. Bill Pritchard of Elkins in the Republican primary the following year. Srygley made his $2,000 contribution to Woods’ campaign, then loaned another $5,000 on May 17, 2012, all while owed repayment on the first loan.

“I would let him know I was still around,” Srygley said when asked what he did to secure repayment.

Srygley does not do business in Arkansas anymore, he testified, because of a 2009 state Supreme Court ruling that check-cashing fees must be considered interest on loans. Payday lenders who had charged fees in excess of the state constitution’s usury provisions were ordered to stop.

Woods’ first repayment on his debt was in mid-2013 with $2,000 in cash, Srygley testified.

“I was disappointed,” Srygley said. “I told him the envelope didn’t feel like it had $35,000 in it, and it didn’t.”

The remaining $33,000 came in an Oct. 1, 2013 cashier’s check to Srygley from Woods for that amount. That $33,000 cashier’s check was cut four days after Randell Shelton Jr. forwarded $40,000 to Woods by wire transfer, evidence presented earlier in the trial showed.

Shelton’s wire transfer was a loan to a friend, according to his defense counsel. Testimony will show Woods owed debts to a series of friends, borrowing heavily each time from one friend to pay the last, according to Shelton’s defense counsel.

Bank records for Shelton's compnay, Paradigm Consulting, and for Woods were detailed in court April 11 by Christy Cops, fraud research specialist for Arvest Bank. Both Woods and Paradigm kept their accounts there.

Woods’ bank records Cops testified to showed as many as 16 overdraft penalties a month in one of his accounts in 2013.

Neither Srygley nor any other creditor appear on Wood’s 2012 or 2013 statements of financial interests, Arkansas Secretary of State records show. All legislators are required to file such statements and list creditors.

Woods was indicted in March 2017, accused of a kickback scheme involving such grants issued in 2013 and 2014. Two alleged co-conspirators — Shelton, formerly of Alma, and Oren Paris III, former president of Ecclesia — were indicted with Woods.

Paris pleaded guilty April 4 to one count of conspiracy. He resigned as Ecclesia’s president and from the college’s board the previous day. His sentence is pending. Paris disguised the kickbacks as consulting fees paid to Paradigm, according to the indictment. Shelton then passed the money along, the government contends.

The kickback allegations involve $550,000 of the more than $717,500 in state General Improvement Fund grants Ecclesia received from 2013 through 2014, the U.S. Department of Justice contends.

Woods directed the most grant money Ecclesia received at more than $350,000, court records show.

Neal pleaded guilty Jan. 4, 2017, for his role in the scheme and was the government’s first witness in the case. His sentence is also pending.

The trial of Woods and Shelton began April 9 in federal court in Fayetteville and is expected to end next week.

Read Friday's Arkansas Democrat-Gazette for full details.

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  • JMort69
    April 26, 2018 at 7:22 p.m.

    So, a sitting Arkansas Senator was using a payday lender. That's a really good recommendation for handling our state budget of billions. And, he didn't pay the Shylock back until he got an alleged bribery payoff from Ecclesia. Between this and the murder-for-hire guy, Rusty Cranford, one has to wonder what other Mafioso like transactions will turn up when the feds start laying out details of the Medicaid fraud, to which some have already admitted? After all, Cranford is the don in both of them. What we do not need in office is broke legislators like Woods and Ballinger. How can they possibly, in good conscience, expect us to trust them with our money when they have to borrow from Peter to pay Paul in their own lives? Woops, I guess the good conscience part is where I got this wrong. Frankly, I am so sickened by what is coming out in this trial, I will be glad when its over. No matter the outcome, these guys need to slink away into their shadowy world and leave the people of Arkansas and our hard earned tax money alone.

  • Goad
    April 26, 2018 at 10:09 p.m.

    You guys up there are real smart. You replaced Senator Pritchard w/thug. Pritchard came by my office every few days when I was Mental Health Commissioner to see if he could do anything for mental patients. He genuinely cared about his constituents mentally ill and all. U need to see if you can get him back.