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)

During the final weeks of that alleged scheme, Standridge is accused of using an entirely different tactic to raise cash from friends in Hot Springs.

Alleged Bank Fraud

In December 2009, according to the second indictment, Standridge borrowed a total of $1.3 million from Hot Springs dentist Steve Baldwin and oral surgeon Edward Cooper, part of the $4.5 million that Standridge said his Steve Standridge Insurance Inc. needed to buy the Bailey Insurance Agency at Mountain Home. Cooper's widow, Cheryl Cooper, told Arkansas Business that her husband had not previously met Standridge but was trying to help his friend Baldwin, who was friendly with Standridge. On the last day of 2009, Cooper gave Standridge cashier’s checks totaling almost $1.1 million, and Baldwin borrowed $250,000 from Simmons First in Hot Springs and then loaned the money to Standridge, both with the understanding that Regions Bank at Harrison would be refinancing the deal on Jan. 15, 2010.

By depositing the borrowed money, Standridge was able to bring the balance in his personal account at Chambers Bank into the black. The account “at the time had a negative balance of approximately $1.3 million,” according to the indictment.

When Jan. 15 rolled around, Standridge repaid both Baldwin and Cooper with interest, although prosecutors say SSI had no agreement to purchase the Bailey agency and no loan lined up with Regions Bank. Cooper died the next month in a plane crash, along with his two teenaged daughters and another Hot Springs dentist, Martin Draper.

On Jan. 25, 10 days after paying him back, Standridge allegedly asked Baldwin to lend him another $400,000 in a hurry so that he could buy an insurance agency in east Texas. After Baldwin approached Steve Trusty, CEO of Simmons First, about another loan, Standridge himself called on Trusty and then sent him documents indicating that Regions had committed to lending him $3 million to buy State First National Insurance Agency of Mount Pleasant, Texas, with the loan to close on March 5.

But when Trusty contacted the Harrison city president of Regions Bank, Scott Tennyson “told Trusty that the commitment letter was false and fraudulent and that Regions Bank had no commitment to loan money to SSI to buy State First,” according to the indictment. On Jan. 27, Trusty formally denied the loan.

And, Trusty told Arkansas Business last week, Simmons First Bank notified the Arkansas State Bank Department of the fraudulent documentation.

The federal government says there was never any deal to buy the Texas agency; in fact, federal prosecutors determined that the agency “had never conducted business or earned any income” and the signatures of the sellers were forged.

Gigerich Loan

While the second loan from Baldwin didn’t materialize, Standridge allegedly used the same fictitious agency purchases to borrow $2.7 million from another Hot Springs friend, Don Gigerich, president of Gigerich Electrical Inc.

On Jan. 16, 2010, the day after he repaid Baldwin and Cooper, Standridge asked Gigerich to lend him $2 million of the $5 million he said SSI needed for a hurry-up purchase of the Bailey agency in Mountain Home. He allegedly told Gigerich that Regions would refinance the loan in early March, and he offered Gigerich $100,000 in interest — a 5 percent return — for the use of the money for about 45 days.

 

 

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