Former Loan Officer Gets Blame for Seven-Figure Losses

by Mark Friedman  on Monday, May. 3, 2010 12:00 am  

'Hazardous Lending'

In February 2008, the FDIC examined Timberland and found the bank had engaged "in hazardous lending and ineffective or lax collection practices," according to the order signed on July 31, 2008.

It accused the bank of failing to obtain proper loan documentation and adequate collateral.

Menefee said last week that bank officials were "surprised and shocked" to receive the order, which "made it very, very difficult to compete once that happened."

In addition, the nation was in the middle of its worst recession in decades.

The court documents don't explain how Turner's alleged misdeeds came to light, but Timberland claims he cost the bank more than the $2 million bond maximum.

"While multiple loan transactions and people were involved, the losses can be categorized by reference to three main participants: Richmark Services, LLC; Invest Four of AR, LLC; and Wilson's Camper & RV Country Inc.," according to Timberland's court documents, which contained several redactions.

Ÿ Little is known about Invest Four of Arkansas or what it does, according to a Feb. 10 letter written by Southern's attorney, Rodney Moore of Arkadelphia, to BancInsure's attorney.

Records of the Arkansas Secretary of State's Office show that Invest Four was incorporated on March 10, 2005. Its registered agent is Jim Taylor of Bryant, and the company is listed in good standing. Taylor couldn't be reached for comment.

In March 2005, Turner approved a loan to Invest Four for $230,000.

"On the same day the loan was funded, Turner received a check from Invest Four for one-third of the loan proceeds," Moore wrote. "No collateral has been recovered."

The bank's loss was listed as $213,000.

 

 

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