LUBBOCK, TX (KCBD) - In documents filed in District Court in September, Vista Bank filed suit against the former Chief Financial Officer of Reagor-Dykes Auto Group, Shane Smith, accusing him of defaulting on an unsecured personal loan for $200,000.
On Nov. 2, court documents were filed and the case was dismissed without prejudice. Attorneys for Vista Bank added the case was dismissed because the parties reached an agreement to resolve the issues; it was dismissed because of a settlement.
The documents stated Smith took out the loan on Jan. 5 and had until Jan. 5, 2019 to pay the loan back. Vista Bank said in the documents he still owed $182,258.54, with interest accruing at the rate of $88.39 per day.
The bank stated Smith defaulted in the payment of the note and had failed and refused to pay the note, and the principal balance of the note was accelerated.
Ford Motor Credit Company is suing Reagor-Dykes dealerships, Bart Reagor and Rick Dykes, according to federal court documents filed on July 31. Ford says the dealerships have an outstanding balance of more than $116 million, and currently more than $41 million is due now.
Ford Motor Credit claims the dealerships have sold Ford Credit vehicles without sending required payments to Ford Credit, repeatedly submitted false or inaccurate information to Ford Credit and its representatives, are otherwise in default under their financing and security agreements with Ford Credit, failed to cure their defaults in spite of the opportunity to do so, and have not voluntarily surrendered vehicles in their possession that is subject for Ford Credit’s security interests.
In a response to Ford Motor Credit’s multi-million dollar lawsuit against Reagor-Dykes Auto Group, Rick Dykes alleged Smith admitted that he provided false financial information regarding the Reagor-Dykes dealerships to Ford Credit and to Bart Reagor and Rick Dykes.
On Aug. 1, Reagor-Dykes Dealerships filed Chapter 11 bankruptcy for multiple locations across Lubbock, Amarillo and other parts of the South Plains.
Court documents filed in mid-August show Vista Bank is suing FirstCapital Bank, Brad Burgess and Kenneth Burgess Jr. to recover more than $6 million in damages. It claims FirstCapital inflicted the damages on Vista through inside information they obtained through their close relationship with Rick Dykes.
Dykes is an insider of both Reagor-Dykes and FirstCapital. The documents state the inside information allowed FirstCapital to benefit from the Reagor-Dykes' check kiting scheme at Vista’s expense.
The lawsuit also states Reagor-Dykes “perpetrated a multi-million dollar check kiting scheme and conspired with FirstCapital to impose the resulting losses, totaling over $6,000,000.”
Attorneys for Ken and Brad Burgess, Chairman and Chief Executive Officer of FirstCapital Bank of Texas, have asked the court to toss Vista Bank’s lawsuit brought related to the alleged check-kiting fraud perpetrated by Reagor-Dykes auto dealership, according to officials with FirstCapital Bank.
“Vista Bank, in a rush to the courthouse, filed its lawsuit against Ken and Brad Burgess based on speculation and without sufficient allegations of wrongdoing,” the Burgess' attorneys said.