Allied Bank Sues for Roof Damage Check Tied to Foreclosed Property

by Arkansas Business Staff  on Monday, Jun. 2, 2014 12:00 am  

Among the financial flotsam surrounding Allied Bank is a lawsuit it filed against U.S. Bank of Cincinnati.

Allied is trying to recover $46,781 deposited from an insurance check that was issued to Adron and Gwen Gilbert and Allied Bank.

U.S. Bank allowed the Gilberts to deposit the money in a personal account without the benefit of Allied’s endorsement.

The payout by Allstate Property & Casualty Insurance Co., made on June 15, 2011, was supposed to cover repairs on hail damage on the Gilberts’ Chenal Valley home.

Six months later, the Gilberts filed bankruptcy. Among their debts were three mortgages with balances of $739,571, $127,240 and $28,139, all in default, secured by the house and held by Allied.

According to its complaint, Allied didn’t learn about the hail damage and insurance check until after it took possession of the 7,262-SF Deauville residence on Sept. 9, 2013.

The bank recovered the property at an $850,000 foreclosure auction in July and also had to fork over more than $52,800 in delinquent property taxes and penalties dating back to 2009.

You might recall that Allied’s parent company, Acme Holding Co. recently filed for Chapter 11.

 

 

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