New Federal Charges Filed Against Steve Standridge

by Gwen Moritz  on Monday, Dec. 23, 2013 12:00 am  

Steve Standridge enters the federal courthouse in Little Rock in 2012. (Photo by Mark Friedman)

(This article has been changed for clarity since its original publication. See end for details.)

In the weeks before his insurance empire crumbled in early 2010, Steve Standridge of Mount Ida persuaded friendly customers to lend him millions of dollars, ostensibly so that he could buy a couple of smaller agencies.

Standridge, who already faces 12 federal felony charges related to alleged bank fraud in the Eastern District of Arkansas, was quietly arrested last month, jailed overnight at Texarkana and then pleaded not guilty to 23 additional federal felony counts.

The new charges in U.S. District Court for the Western District allege that Standridge still owes one man $2.7 million borrowed under false pretenses and that he submitted fraudulent documents to Simmons First Bank of Hot Springs when another man tried to borrow $400,000 in order to lend it to Standridge.

It’s not clear exactly what led Standridge into the financial hole described by federal prosecutors. But, taken together, the indictments paint a picture of a man desperate to raise cash in 2009 and especially during the first weeks of 2010. The new charges allege a Ponzi-like scenario in which Standridge repeatedly sought large, short-term loans, not for the business deals he claimed but to pay off earlier large, short-term loans.

His insurance license would be suspended on March 1, 2010, after state Insurance Commissioner Jay Bradford concluded that Standridge had falsified the collateral he used to purchase Gibraltar National Insurance Co. of Little Rock in early 2009.

“We take cases in which individuals abuse positions of trust in the business community to essentially steal money very seriously,” U.S. Attorney Conner Eldridge said in a statement to Arkansas Business. “As alleged, Mr. Standridge used his position in the insurance business to swindle money from clients and friends. The scheme set forth in the indictment amounts to fraud designed to obtain money under the guise of a legitimate investment. Fraud causes great harm to innocent victims. For this reason, we will continue to aggressively pursue cases such as this throughout the Western District of Arkansas.”

The indictment was issued under seal on Oct. 30 by a grand jury in Hot Springs. An arrest warrant was issued the next day, and Standridge was arrested in Little Rock on Nov. 4 by U.S. marshals who delivered him to the Miller County Detention Center. He was arraigned the next day before U.S. Magistrate Barry A. Bryant and released on a $10,000 bond.

The attorney who appeared with Standridge at the arraignment, Louis L. Loyd of Malvern, did not respond to a call and email seeking comment. Tim Dudley, the Little Rock attorney defending Standridge in the first indictment, said he may eventually take over the new case as well.

A trial has been set for April 3 in El Dorado, three months before Standridge is scheduled to stand trial in Little Rock on the earlier indictment, which was issued in August 2012.

Two of Standridge’s customers, lumber company owner Danny Wood of Idabel, Okla., and contractor Gregory A. Hunt of Russellville, pleaded guilty last year to aiding and abetting Standridge in obtaining fraudulent premium finance loans from Chambers Bank of Danville, the Bank of Star City and the Bank of Delight. Wood, 61, is serving a 30-month sentence in the federal prison at Fort Worth, Texas, and Hunt died at the federal prison in Memphis in February at age 46.

The premium finance loans were obtained between April and August 2009, according to the first indictment, but the conspiracy allegedly lasted from November 2008 to February 2010.



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