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Quapaw House Faces ForeclosureLock Icon

2 min read

Quapaw House Inc., the troubled Hot Springs drug and alcohol treatment provider that is no longer operating, recently entered into a consent judgment for $1.43 million with Relyance Bank.

With the judgment entered last month, the Pine Bluff bank can proceed to foreclosure against Quapaw’s Hot Springs properties at 500 Quapaw Ave. and 505 W. Grand Ave.

The court filings said that Quapaw House defaulted on a promissory note and mortgage tied to the properties.

Garland County Circuit Judge Lynn Williams said in his filing last month that if the judgment isn’t paid within 10 days, the properties will be sold.

That doesn’t end the litigation. Malvern National Bank has claims pending against Quapaw House, its officers and directors.

If you recall, the bank accused Quapaw House of fraud for misrepresenting its financial condition in order to get loans in 2019. Last year, MNB demanded repayment of $1.5 million, but Quapaw defaulted on the amount.

Casey Bright, the former CEO of Quapaw House, was named as one of the defendants in a lawsuit filed by MNB. Bright was hit with a $1.2 million default judgment in November in the case.

In May, Bright filed for Chapter 7 bankruptcy liquidation in U.S. Bankruptcy Court in Maryland. He listed $403,000 in assets and $1.7 million in debts, which included the amount owed to MNB.

For more than a year, Bright has been working as an executive vice president of operations for Amatus Health in Owings Mills, Maryland, which provides treatment to people with substance abuse and mental health disorders.

In 2020, Bright reported income of $125,600, and in 2019, his income was $153,000.

The problems at Quapaw House, founded in 1980, appear to have started after it acquired the Arkansas assets of scandal-plagued Preferred Family Healthcare in October 2018, after multiple PFH executives were convicted of embezzlement and corruption.

The PFH acquisition was a big revenue boost for Quapaw House but didn’t help the bottom line.

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