LUBBOCK, Texas — Reagor Dykes filed a court document Wednesday claiming that Vista Bank’s President John Steinmetz had a side deal with former CFO Shane Smith.
SPECIAL NOTE: Vista Bank issued a statement late Wednesday. The full statement is copied below.
As part of the ongoing Reagor Dykes bankruptcy, Vista Bank filed a claim last year in bankruptcy court for permission to keep funds that Reagor Dykes deposited in its checking accounts. Vista claimed that bounced checks from Reagor Dykes totaled more than $13.5 million. Vista wanted to keep more than $1 million to offset the loss.
After it filed for bankruptcy, Reagor Dykes was placed under the control of a Chief Restructuring Officer (CRO). It is the CRO that filed the most recent court documents.
In the meantime, Smith and many other Reagor Dykes employees took federal plea deals – some for bank fraud and some for floor-plan fraud.
Reagor Dykes (via the CRO) claimed that Vista allowed Smith to carry out a check-kiting scheme (which is a form of bank fraud). The legal argument is that because Vista participated, then Vista is not a victim.
The most recent court filing said in 2017 Reagor Dykes deposited $1.4 billion into Vista bank but three Vista accounts were overdrawn for a combined 368 days.
“And yet Vista continued honoring checks and debits against overdrawn accounts,” the filing said.
“Vista Bank President, John D. Steinmetz, personally enriched himself through kickbacks (in the form of roughly $150,000.00 in subsidized luxury car leases for his personal use,” the court filing said.
The filing also said, “At all relevant times, Vista Bank and Steinmetz knew what Shane Smith was doing. Moreover, and as explained below, they took affirmative acts to assist and help Smith in the scheme.”
The filing said Steinmetz got a special deal on luxury car leases – one such lease that was under discussion would have been an Aston Martin “of James Bond fame.”
Among other things, Reagor Dykes wants the money back that was in the Vista checking accounts despite the overdrafts.
A judge has not yet ruled on the request and the bankruptcy case is still ongoing.
The full statement from Vista Bank said:
After over a year and a half in bankruptcy, three failed attempts to reorganize, and racking up over $5 million in unpaid legal fees for the Chief Restructuring Officer and his lawyers, today they filed a complaint in a last ditch attempt to shake down Vista Bank for money before their upcoming February 12, 2020 bankruptcy hearing where they face potential forced liquidation.
As conclusively established by the twelve (12) criminal felony guilty pleas (with more surely to come) in addition to the overwhelming record of the pending criminal, bankruptcy and litigation proceedings involving the Debtors:
- the Debtors and their insiders perpetrated the frauds causing the Debtors’ insolvency and bankruptcy resulting in harm to Vista Bank as well as the Debtors’ other third-party creditors; and
- as detailed in its filed proofs of claim, Vista Bank suffered at least $13 million in damages as a direct result of this confessed fraud.
- Mr. Steinmetz paid over $120,000 in lease/buyout payments for the noted vehicles. Even if that was a ‘good deal,’ West Texans have too much common sense to believe Mr. Steinmetz would have sold his bank out to the tune of millions of dollars in order to save a few thousand on a couple of cars.
- Not a single bank or banker has been implicated in any of the RDAG guilty pleas.
For the CRO’s legal counsel to file this complaint is akin to a thief robbing someone, getting caught, pleading guilty to the felony, and then suing the victim to pay for it all. Vista Bank refuses to be extorted by the criminals who ran Reagor-Dykes. For that reason, last month Vista Bank sued RDAG to preemptively defeat its frivolous claims. Attached is a copy of Vista Bank’s lawsuit.