One Bank Juggled Bad Penny Stock Loan

by George Waldon  on Monday, Sep. 9, 2013 12:00 am  

Former One Bank & Trust CEO and President Layton "Scooter" Stuart (left), who died March 26; Gary Rickenbach (center), former executive vice president and chief loan officer; and Alberto Solaroli (right) of Jacksonville, Fla.

A nonperforming loan in Florida helped lead to the ouster of Layton “Scooter” Stuart, former chairman, president and CEO of Little Rock’s One Bank & Trust.

Through a strange turn of events, the bad loan in the Sunshine State brought Stuart into deeper controversy when he built a million-dollar manor for his son, Hunter. The Florida debt and west Little Rock house are entwined in the web of loans, cashier checks and self-dealing at One Bank.

Accounts from Stuart, who died on March 26, and Gary Rickenbach, former executive vice president and chief loan officer, provide the narrative link for the two seemingly unrelated items.

In January 2009, Stuart planned to use debt-free property near Little Rock’s prestigious Edgehill neighborhood as collateral to finance his son’s upscale project in Pleasant Valley. Instead, the three residential lots on Crestwood Drive, owned by Scooter Stuart’s Crestwood Investment LLC, were mortgaged for $1.1 million and the proceeds used to financially mask a nonperforming loan in Florida.

“Mr. Stuart participated [in covering the bad loan] via a real estate-secured loan and effectively made a capital contribution to the bank,” Rickenbach wrote in an internal memorandum dated Sept. 30, 2012.

“The Crestwood loan was presented to and approved by the board due to the insider nature of the loan, but my loan presentation did not clearly state the use of the proceeds and was misleading to the board.”

Stuart agreed to let Rickenbach use his Crestwood property as collateral as long as it didn’t interfere with his efforts to purchase a home for his son.

“I told them I need access to cash, as I had plan[s] to buy Hunter a house and remodel, so I agreed to a 90-day deal, with one extension,” Stuart wrote to an associate in an email dated March 24, two days before his death. “But in any case, I was to have full access to the collateral and/or cash to use on the home purchased for Hunter.

“They made me feel fully comfortable they could cover any cash needs I would have, so I agreed but never knew what happened after that.” “They” are Rickenbach and Michael Heald, whom Stuart fired as executive vice president and chief operating officer in August 2011.

This professed ignorance would ultimately cost Stuart in regards to the money used to pay for the construction costs of the Pleasant Valley home.

Solaroli Loan

The bad loan that brought Stuart and his Crestwood Investment into play totaled about $1.5 million. Rickenbach had made the loan to Alberto Solaroli, a one-time Porsche-tuning shop owner in Toronto who became a purported mechanical innovator after moving to Jacksonville, Fla., in 2005.

 

 

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