Arvest: Was Unaware of Agreement Involving Dennis Smiley’s Loan Collateral

Arvest Bank said Friday that it was unaware of documents purportedly signed by one of its executives that allowed Dennis Smiley to use his stock in an Arvest executive incentive account as loan collateral at First National Bank of Fort Smith.

In filing Friday in Benton County Circuit Court, Arvest “specifically denies that it had any knowledge whatsoever of a Control Agreement and/or letter as issued by Chad Evans as Executive Vice President …”

That agreement allowed Smiley, formerly CEO of Arvest Bank’s Benton County operations, to pledge money from his Arvest incentive account as collateral on two loans from the Fort Smith bank.

First National Bank sued Smiley, Smiley’s HDS Holdings LLC, and Smiley’s father, Henry Dennis Smiley Sr. of De Queen, on April 11 to collect a combined outstanding balance on the loans of $196,093. 

Smiley is under federal criminal investigation for loan fraud. He’s also facing lawsuits by nearly a dozen banks for defaulting on loan agreements, which Arkansas Business sources have said could total more than $4.5 million. 

Arvest has said it specifically forbade the use of its incentive funds as collateral. Arvest’s filing on Friday is the first time the bank answered allegations that some of its executives, including Evans, had approved such use.

Other banks that loaned Smiley money had made claims similar to the Fort Smith bank, citing control agreements purportedly signed by Arvest executives Evans, Euva Phillips and Jeb Mills. Those agreements allowed Smiley to use Arvest incentive account proceeds as collateral repeatedly at several banks.

Arvest also said Friday that the control agreement for the First National Bank loan only gave the First National access to an Arvest incentive account ending in number 586. But Arvest said “there was and never has been any assets in said account.”

Arvest also said the control agreement was signed “in the capacity of Arvest Bank” and not Arvest Bank Group Inc., the bank’s holding company that Arvest Bank said it “the true holder of the account.”