Steve Standridge Settles Lawsuit with Cornerstone

by Arkansas Business Staff  on Monday, Nov. 12, 2012 12:00 am  

Steve Standridge now has one less legal battle to deal with as he prepares for his criminal trial.

Standridge, the former insurance agent from Mount Ida who is facing 12 felony federal counts related to allegedly fraudulent premium finance loans, recently settled a lawsuit where he and his agency were accused of fraud and defaulting on loans totaling $152,400.

Standridge agreed to pay the plaintiff, Cornerstone Finance Co. of Columbia, Mo., $45,000 in three $15,000 installments. But if he misses a payment, then Cornerstone will go after Standridge for the $152,400 plus $15,000 for attorney’s fees and other amounts.

Cornerstone filed the lawsuit last year in U.S. District Court in Hot Springs. The company said it handled the insurance premium financing for several of Standridge’s lumber company clients.

Cornerstone made the loans between April 2009 and February 2010. Standridge and his agency had guaranteed them, and Cornerstone held the policies as collateral.

When the loans started defaulting, Cornerstone contacted the insurance companies that held the policies. Cornerstone wanted the carriers to cancel the policies so that any unearned premium would be returned to Cornerstone and applied against the balances owed on the promissory notes, the lawsuit said.

That’s when Cornerstone learned that “no such insurance policies existed despite the contractual obligations and representations” of Standridge and the companies that borrowed the money.

Cornerstone’s lawsuit said Standridge used “deceptive, false, unconscionable, willful, and malicious” tactics to obtain the loans. Cornerstone wanted its money back for the loans and was seeking at least $500,000 in damages.

With that case settled, Standridge now can turn his attention to defending himself in U.S. District Court in Little Rock, where he has pleaded not guilty.

Standridge’s defense team is scheduled to have a hearing on Nov. 20 involving a subpoena issued to Darwin Hendrix, the CEO of the Bank of Delight. He was supposed to hand over all of the bank’s records involving a number of loans related to Standridge’s case.

In response, Hendrix said he was prohibited from disclosing nonpublic personal information of a customer. We understand that some of the records the defense team is seeking involve the bank’s suspicious activity reports.

 

 

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