A fraud conspiracy complaint filed in federal court by the former chairman and one-time largest shareholder of Stone Bank has been dismissed.
James Barnes, who sought more than $4 million in damages, claimed he was pushed out of the bank that he helped launch seven years ago and was forced to sell his stake in the bank at below market pricing. According to his complaint in U.S. District Court in Little Rock, J.T. Compton orchestrated the scheme with the aid of his son and fellow board member, Kevin.
Other defendants were David Dunlap, a bank director; Marnie Oldner, CEO of Stone Bank; Nick Roach, president of the bank; and Stone Bancshares Inc., parent company of the $152 million-asset lender.
Judge Leon Holmes essentially ruled that Barnes failed to make his case and granted the defendants’ motion to dismiss.
Barnes alleged the deceptive scheme included unfulfilled promises to help restructure his bank loans and misrepresenting his business dealings at Stone Bank to federal regulators. On April 21, 2013, Barnes was removed as chairman in what he portrayed as a corporate coup by Compton, who replaced him.
Barnes resigned from the board of directors on Oct. 18, 2013, and 17 months later signed a consent order with the Office of the Comptroller of the Currency that prohibits his participation in banking. He also was fined $20,000.
According to the March 18, 2015, order, Barnes “committed reckless, unsafe or unsound practices and breached his fiduciary duties” to Stone Bank. His “actions caused loss to the bank, and he demonstrated personal dishonesty and a willful and continuing disregard for the bank’s safety and soundness.”
Two days after the OCC consent order, his James Barnes & Associates Inc. filed Chapter 12 bankruptcy listing $3 million in assets and $4 million in liabilities. Stone Bank holds more than $672,000 of debt connected with the bankruptcy petition.
Formerly known as Ozark Heritage, the bank spent five years working through an OCC consent order signed on Aug. 24, 2010. Hiring competent management and a laundry list of operational improvements were at the heart of that 38-page regulatory action.
In connection with that, the bank’s former president, Marvin Sutterfield, was fined $20,000 and cited for unsafe and unsound lending practices in 2012.
Stone Bank, Mountain View
Full-Service Locations: Mountain View, White Hall and Little Rock
(All dollars in thousands)
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*Changed name from Ozark Heritage Bank
**Founded on the acquisition of the $11.7 million-asset First National Bank of Altheimer