The Rise and Fall of Ed Harvey's Business Empire

by Mark Friedman  on Monday, Aug. 2, 2010 12:00 am  

In the middle of 2008, the Harveys hired Marvin Jones, the financial adviser, to evaluate their portfolio of companies.

At the time, they were "having financial difficulties," Jones said in his April deposition in First Security Bank's collection suit.

In mid-2008, "it was feasible that he could take a $15 [million] to $17 million personal hit" just on Continental's loans he had personally guaranteed, Jones said.

Jones also said that, as of 2008, Harvey had personally guaranteed between $50 million and $60 million in outstanding loans. Jones told Ed and Bonnie Harvey that they needed to protect his assets.

By the end of 2008, Harvey had transferred his assets - including his Little Rock home, property in Florida, Harvey Manufacturing Corp. and 99 percent of the stock of Preston National Bank - to his wife. Preston National's book value is about $8 million.

Ed Harvey's monthly income is now limited to the approximate $1,000 he collects from Social Security while his wife's monthly income is between $75,000 and $80,000, Jones said.

Both First Security Bank and Metropolitan National Bank have asked in their lawsuits that the transfer of assets to Bonnie Harvey be voided or that she be made responsible for the defaulted loans. The banks also want a receiver appointed to care for the assets.

"Unless a receiver is appointed to take charge of the fraudulently transferred assets, it is likely that Mr. and Mrs. Harvey will again try to conceal them through further transfers to keep them beyond the reach of Mr. Harvey's creditors, including Metropolitan," the MNB lawsuit said.

Donovan said Bonnie Harvey became involved in her husband's businesses because of his health issues.

"She has learned a lot about what businesses there were and how she needs to deal with it," he said. "Mrs. Harvey is a very strong person and is determined to fight through these difficulties, and I'm sure she will."

 See also: Harvey's Business Declines Affect Pryor's Finances

 

 

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