Litigation involving a small fleet of corporate jets loaded with debt evaporated on Oct. 23, 2013. For Bill Schwyhart, the settlements did more than end lawsuits with billionaire John Calamos as well as former partners Johnelle Hunt and Tim Graham.
The Calamos settlement marked an epic payday of several million dollars that restored the financial fortunes of the once high-flying northwest Arkansas developer. As part of the Hunt-Graham settlement, Schwyhart regained ownership of his beloved Rogers mansion.
That’s the claim of a dogged creditor whose allegations of fraud against Schwyhart pried open the secret settlements, once enshrouded by a confidentiality agreement for protection from prying eyes.
Details of those settlements help flesh out a fraud conspiracy laid out by Rogers attorney Brian Ferguson on behalf of his CHP LLC. Details of the settlements became part of the public record on Feb. 12 in connection with the Chapter 7 bankruptcy case of Bill and Carolyn Schwyhart in Dallas.
Ferguson unveiled how the settlements had worked to enable Schwyhart to enjoy the double life of a broke businessman for creditors and an incognito millionaire for him and his family.
Schwyhart’s hidden assets trail began more than five years ago with a $9.75 million payout from Calamos. That money was wired to a trust account held by Chris Ayres, lead attorney in the Calamos litigation for Schwyhart and his late partner, Bob Thornton.
The cash settlement ended the lawsuits between Calamos and Schwyhart-Thornton over the disastrous $110 million air charter merger that created Aspen-Jetride.
The Ayres Law Firm of Dallas kept an unspecified amount of the Calamos payout for its services and sent $3 million to Hunt-Graham as part of a settlement. Hunt-Graham held judgments against Schwyhart-Thornton totaling more than $11 million in connection with the air charter deal gone bad. Judgments held by Hunt-Graham were relinquished as part of the settlement.
The millions of dollars left after paying Ayres and settling with Hunt-Graham were wired to a trust account held by Fayetteville attorney Stanley Bond, who had done bankruptcy work for Schwyhart-Thornton.
In a deposition, Bond testified he couldn’t remember where he sent the money but said it could have been TWG Resources LLC. The limited liability company is owned and controlled by Bill Schwyhart’s son, Alex.
In his pursuit of Schwyhart assets, Ferguson uncovered that money flowed freely from TWG Resources to HMG Investments LLC and on to Bill and Carolyn Schwyhart.
According to Ferguson, TWG made regular contributions to HMG’s bank account, which between January 2017 and June 2018 totaled at least $150,000. He said Bill and Carolyn Schwyhart used the funds to meet the majority of their living expenses.
In his 50-page complaint objecting to the couple’s discharge from bankruptcy, Ferguson noted that Bill Schwyhart’s Citibank credit card is paid from the HMG account although Schwyhart claimed in his bankruptcy that he didn’t have a credit card.
“When Mr. Schwyhart testified that he did not know whether HMG had a bank account, he knew that HMG had a bank account at Bank of America,” Ferguson wrote in his complaint. “He had to know, because the defendants were using that account at that time to meet the vast majority of their living expenses.”
On paper, the ownership of HMG Investments is a multilayered LLC sandwich.
South 40 Partners LLC owns 100 percent of it. In turn, South 40 is owned by Thornhart Venture LLC, 99 percent; Schwyhart Holdings LLC, 0.6 percent; and Robert B. Thornton LLC, 0.4 percent.
At least 60 percent of Thornhart Venture is owned by Schwyhart Holdings. Presumably, the remaining 40 percent is owned by Robert B. Thornton LLC. Thornton died in November 2015.
In his complaint, Ferguson noted that the Schwyharts finally admitted under questioning by the U.S. trustee on Dec. 17 that they “are the only living, breathing humans” who have an ownership interest in Thornhart Venture, South 40 Partners and HMG Investments.
Other LLCs were deployed to take ownership of Schwyhart’s former home as part of the settlement with Hunt-Graham.
Pinnacle Villa LLC became the owner of record for the 9,484-SF country club mansion in Rogers in exchange for Schwyhart giving his financial interest in HSG-HCC LLC to Hunt-Graham.
His stake in the limited liability company was an estimated $1.6 million in tax credits associated with the John Q. Hammons Center in Rogers. The exchange gave Hunt-Graham sole ownership of the LLC and its tax credits.
For a deposition, Stanley Bond appeared as a corporate representative for Pinnacle Villa. He testified that Alex Schwyhart was the property manager of the LLC with the power to hire caretakers for the house.
Bill and Carolyn Schwyhart portray themselves as caretakers in a rent-free arrangement with the unknown owners of Pinnacle Villa. They moved into the grand house after Pinnacle Villa took ownership.
On paper, Recipio Invest-ments Strategic Fund I LLC owns Pinnacle Villa. It in turn is owned by Recipio Investments LLC, which doesn’t legally exist, according to Ferguson’s corporate search.
Since Pinnacle Villa arrived on the scene, property taxes for the residence have been paid by TWG Resources on checks signed by Alex Schwyhart.
As part of his collection effort, Ferguson attempted to perfect a claim against the Schwyharts’ home and their personal property in it. That action preceded their move to a rented house in Dallas in March and bankruptcy filing in July.
In a May deposition, Schwyhart said it was their intent to stay in Texas because they love Dallas and have good friends there.
“Too many ill relationships in Arkansas,” he added.
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