AMARILLO, Texas (KAMR/KCIT) — After both the prosecution and the defense presented its witnesses during Wednesday’s portion of the Bart Reagor jury trial, the jury, as well as others in the courtroom, heard final, closing arguments from both the prosecution and the defense.
After hearing those arguments, the jury went into deliberation at approximately 10:17 a.m., ultimately making the decision on whether Reagor committed two counts of bank fraud and one count of making false statements to a bank. According to previous reports by MyHighPlains.com, Reagor pleaded not guilty to the counts in an Amarillo Federal Court appearance in April.
Prior to the closing arguments from each side, the judge read the jury charge aloud, giving the jury instructions for what their deliberation should look like. During the charge, U.S. District Judge Matthew J. Kacsmaryk, the federal judge overseeing Reagor’s trial, said that the jurors are the “judges of the facts,” basing the verdict only on the evidence.
Kacsmaryk stressed to the jury the importance of considering only the evidence and testimony presented to the jury during the trial. It is ultimately up to the jury on whether or not they believe the evidence and the testimony is credible for the case. Each count should be considered separately for the jury, and if the jury unanimously finds Reagor guilty on any of the charges, Kacsmaryk, as the judge, will be the one to determine punishment.
Closing Arguments – Prosecution
At the beginning of his closing arguments, Jeffrey Haag, a member of the prosecution’s counsel, stressed to the jury that the allegations against Reagor are of fraud, stating that Reagor falsely represented that funds from a $10 million working capital loan to the Reagor Dykes Auto Group (RDAG) from the International Bank of Commerce (IBC) was solely going to the business. Haag said that Reagor omitted the fact that he was going to use a portion of the loan funds, approximately $1.76 million, for his personal benefit.
Haag once again laid out the timeline, stating that the prosecution believes the intent began with an initial meeting with IBC Bank in April 2017, outlining the purpose of the loan. In the use of funds portion of a loan memorandum, written after that initial meeting, IBC Bank officials stated that the entirety of the loan was aimed to inject funds into the various RDAG entities because of growth, giving each entity a sizable cash cushion.
At that time, Haag said Reagor did not outline the intentions of using some of the funds for personal use, a fact which witnesses from IBC Bank stated would have impacted their opinion on whether or not to give RDAG the loan initially.
Haag also referenced an email sent from Reagor to RDAG co-owner Rick Dykes and RDAG chief financial officer on May 31, 2017, six weeks prior to the loan agreement being signed. Haag said he believes that this email “clearly, succinctly lays out the fraud scheme,” stating that Dykes and Reagor would each get a percentage portion of the funds from the working capital loan. Officials from the prosecution stated there was a reason why other members of the RDAG Deal Team, including various legal personnel, as well as IBC Bank personnel were not included in this email outlining the plans.
Haag said Reagor only shared the plans with individuals who would obey the request and not object to the request, being confident that no one in the email would tell Reagor it was wrong. In the email, Reagor states that it should be “100,000,000 confidential” and no one else’s business, including bankers.
While representatives from the defense would go on to say that Reagor invested some of his own money into the company and funds from a working capital loan could be used to repay Reagor, the prosecution claims that Reagor invested $500,000 of his own money, taking approximately $1.76 million from the working capital loan.
Because of the evidence and the testimony which the prosecution presented, officials with the prosecution stated that they believe the jury should find Reagor guilty on all three counts.
Closing Arguments – Defense
After the prosecution’s closing argument, Dan Cogdell, a member of the defense counsel, stated to the jury his belief that the prosecution did not have evidence to convict Reagor beyond a reasonable doubt, with the burden of proof being on the prosecution.
Cogdell said it is not a “leftist plot” or “socialist” to give Reagor a not guilty verdict, stating it is what the jury should do if the case was not proved by the prosecution, which he believes it was not.
During his closing argument, Cogdell said the prosecution tried the case on emotion because they did not have the facts. Cogdell referenced the May email, an audio recording where Reagor uses colorful language, talking about his plethora of wealth as well as various checks which the prosecution claims how Reagor spent the funds from the loan, including making improvements to his “mansion on 19th Street.”
“Three years to investigate this case and this is (the prosecution’s) proof?” Cogdell asked the jury. “…This is the sort of stuff that’s supposed to convince you beyond a reasonable doubt? Nonsense.”
Cogdell referenced testimony from the defense’s two expert witnesses, Franklin Snyder, a professor of law at the Texas A&M University School of Law and Steven Fried, a 33-year veteran in the banking industry, both of which said that Reagor was well within his right to use the working capital loan funds in this way under the loan agreement, calling Snyder’s testimony a “killshot,” leading the prosecution to not provide a rebuttal during Wednesday’s proceedings.
Cogdell stressed that Reagor continued to believe that he could repay himself for his investment with funds from the working capital loan, with no evidence of anyone coming forward and stating that he could not do what he did.
As he did during Smith’s testimony, Cogdell continued to question Smith’s credibility and the content of his testimony. Cogdell repeatedly said that Reagor relied on Smith for RDAG’s financials, not knowing the true state of RDAG’s financial status. Cogdell said Smith betrayed the trust of Reagor and that the jury cannot base a conviction on what the prosecution “wanted Smith to say.”
To end his argument, Cogdell stressed to the jury that Reagor is not guilty on any of the counts, calling on the jury to “give him back to me.”
Closing Arguments – Prosecution rebuttal
In an allowed 17 minute rebuttal by the prosecution, Haag compared the defense’s strategy in the case to a “maze,” finding a path to the truth. He said there is a tendency to equate confusion with reasonable doubt.
Two objections came from the defense after Haag compared their strategy in this way. However, Kacsmaryk allowed it to continue, stating there was impassioned and zealous language during the defense’s portion of closing arguments with no interruptions from the prosecution.
Regarding Smith’s testimony, Haag said it is on the jury to determine the credibility of what he said on the stand. However, Haag stressed that Smith’s testimony is “supplemental” to the charges from the indictment, along with the loan memorandum from IBC bank, the email Reagor sent to Dykes and Smith as well as the various IBC witnesses who testified.
Haag also continued to stress that the cause is a “fraud case,” discounting the testimony from both Snyder and Fried, who referenced the contract’s interpretation. Haag told the jury that the fraud occurred prior to the loan agreement being signed, stating that because of the fraud, there should have not been an agreement in the first place.
The prosecution stressed that Reagor told the bank that the working capital loan was to operate the various RDAG entities but omitted the fact that he was going to use part of the loan funds for personal use. This fact, Haag believes, deems the contract, and various contract interpretation arguments irrelevant.
In the final portion of his rebuttal, Haag compared the case to a person obtaining a home, business or car loan from a bank. He stressed that individuals who obtain these loans can only use the funds for what they were requested for.
The simple truth, Haag said, was that Reagor lied to IBC bank about the purpose of the working capital loan, with officials from IBC bank testifying that they would have not made the loan if they knew of Reagor’s intentions. Because of this, Haag said he hopes the jury renders a verdict more consistent with the truth, which is a guilty verdict on all counts.
After hearing the final arguments, the jury is now in deliberation on whether or not Reagor will be found guilty on the following charges:
- Two counts of bank fraud;
- One count of making false statements to a bank.
The team from MyHighPlains continues to be at Amarillo Federal Court will update the website once the jury reaches a verdict in this case.
This story is developing. Check with MyHighPlains.com for updates