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Arkansas Business on 'Today's THV at 6': Update on First Southern Bank fraudulent bonds | News

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Arkansas Business on 'Today's THV at 6': Update on First Southern Bank fraudulent bonds
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With more on the bank, and the Little Rock attorney who sold the bonds - here's Arkansas Business publisher Jeff Hankins stopped in to tell us more.

A new deal is in the works that will bring new ownership and new money to First Southern Bank after its capital base was threatened by the discovery of those fake bonds the bank had bought for nearly $22 million.

In the meantime, investigators are looking into the role attorney Kevin Lewis played in the deal. Lewis allegedly created fake bonds and sold them to the bank, according state senator David Wyatt, a director at First Southern.

Lewis, the largest shareholder in the bank through a trust he owns, then borrowed $3 million to buy more shares in the bank to maintain his trust's majority position.

In all, the affair looks like it might be a ponzi scheme, whereby Lewis used a combination of selling fake bonds and using fake bones as collateral to borrow even more money.

So far, Lewis hasn't returned numerous phone messages and has retained an attorney, Tim Dudley, who won't comment on Lewis'whereabouts.

Meanwhile, Capital Bank of Little Rock on Friday filed a $2.4 million foreclosure lawsuit on a loan Lewis took out for his 6,700 square foot home on Chenal Circle in Little Rock.

The loan is secured by the house and two more of those improvement district bonds.

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