$2.5 Million Home's Ruins Reflect Whitbeck's Fortunes

by George Waldon  on Monday, Feb. 16, 2009 12:00 am  

This pile of rubble at 2322 N. Spruce St. was once the home of Little Rock insurance executive Frank Whitbeck.

Dyke donated his collection of 133 drawings and watercolors by neoimpressionist artist Paul Signac to the Arkansas Arts Center more than eight years ago. At the time, that gift was described simply as a multimillion-dollar treasure.

Dyke played a pivotal role in the purchase of a controversial piece of art that graces downtown Little Rock's intersection of Main Street and Capitol Avenue: "Standing Figure: Knife Edge." The 1,200-pound, bronze sculpture is the work of the late Henry Moore, a world-renowned British sculptor.

Though some consider the 12-foot abstract piece an acquired taste, no one quibbles with it as an investment. Purchased for $185,000 in 1978, the sculpture is appraised at $2.5 million.

Not So Golden Touch

The passage of time hasn't been as kind to the fortunes of Frank Whitbeck. The purchase of his property, which was loaded with debt and creditor claims, resulted in a $500,000 check for the Arkansas State Insurance Department.

The money went toward the restitution of Little Rock's Signature Life Insurance Co. of America, which the agency took over after discovering that Whitbeck had mismanaged the company to the point of insolvency.

The $500,000 brought Whitbeck current on past-due quarterly installment payments on a financial settlement with the Insurance Department and will keep him in good stead until a final balloon payment this fall. Whitbeck now owes about $2.5 million, which will be due in full on Sept. 30.

"The closer we get to that date, the more reliable the number will be," said Steve Uhrynowycz, deputy receiver for the Insurance Department.

The agency will order an actuarial review this summer to determine what the final number will be. The total was estimated to be $3.7 million in 2004 when the Insurance Department sent Whitbeck a notice to cure Signature's Life's capital shortfall.

That $3.7 million figure was entered as a judgment against Whitbeck when he was sentenced to six years for fraud on Oct. 23. The deal to sell the house was said to be in the works back then.

"We felt like letting it go through a private sale was the best way to get a good sales price," Jane Duke, U.S. Attorney for the Eastern District of Arkansas, said of the decision not to foreclose after the judgment was entered.

The restitution is connected with assets he illegally diverted from Signature Life for his personal use and to another of his ventures, Winrock Grass Farm Inc.



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