WASHINGTON — Business leaders began an aggressive lobbying effort Thursday to ensure that their vision for overhauling the U.S. tax system isn't lost in the chaos consuming President Donald Trump's administration.

The Koch brothers' political network announced it is preparing to spend millions of dollars to promote a tax overhaul.

That word came as a handful of business executives told a congressional committee that the current tax system makes U.S. companies uncompetitive.

"We no longer live in a world where the U.S. can set a corporate tax rate without considering what our international competition looks like," John Stephen, AT&T's chief financial officer told the House Ways and Means Committee. "Countries are vigorously competing against each other to attract investment and jobs, but the U.S. has done little to retain its competitive advantage."

Billionaire industrialists Charles and David Koch are undertaking a multimillion-dollar campaign through the summer to ensure their conservative tax plan is not forgotten, said James Davis, spokesman for the Kochs' political network.

The campaign will include digital ads and town hall meetings, along with phone banks and direct mail.

"Now is the time. We've got to unite around these principles," Davis said. "The White House hopefully will see this as a jolt to support them in driving this forward."

The Koch push reflects broader concerns from the nation's business community that Trump's promise of a tax overhaul may fall victim to his mounting political challenges. The stock market on Wednesday suffered its largest single-day loss of the Trump presidency. That was before the Justice Department appointed a special counsel to investigate allegations that Trump's campaign collaborated with Russia to sway the 2016 election.

Treasury Secretary Steven Mnuchin said 100 people at his department are working on an overhaul, and that the goal is to bring "meaningful relief" to the middle class and make American businesses competitive.

Mnuchin testified before the Senate Banking, Housing and Urban Affairs Committee — his first appearance before that committee since being sworn in.

He said the U.S. can achieve 3 percent economic growth if the United States makes historic changes in taxes and regulations. The Treasury Department also is preparing a report on regulatory changes for the finance system. Mnuchin said it will be broader than simply undoing much of the Dodd-Frank law enacted under President Barack Obama.

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MERIDIAN, Miss. — Call them the unrecovered — a handful of states where job markets, nine years later, are still struggling back to where they were before the recession.

That's true in Mississippi, where job numbers and the overall size of the economy remain below 2008 levels. Unlike states that have long since sprinted ahead, Mississippi is struggling with slow economic growth and slipping population in a place that's rarely at peak economic health.

Miguel Brown, despite family ties to his hometown near the Alabama border, is working on oil rigs off the shore of Texas, chasing higher wages.

"It's rough," said the 49-year-old Brown. "There's not a whole lot of jobs in Meridian, especially that pay anything."

Not only Mississippi, but also Alabama, Michigan, New Mexico, and West Virginia are still short of pre-recession job levels by multiple measures. That contrasts with states including Colorado, North Dakota, Texas and Utah, where employment numbers have soared. Nationwide, job numbers surpassed pre-recession peaks in the middle of 2014, about the same time Mississippi was saddled with the nation's highest unemployment rate.

Emilia Istrate, who produces a yearly report on how local economies are faring for the National Association of Counties, said the recovery has been widespread but "uneven."

"It explains why so many Americans don't feel the national economic numbers. It's because they live in one of these places that is still in recovery or struggling," Istrate said.

Growth has long lagged in Mississippi, and jobless rates are high even in good times. The unemployment rate fell to 5 percent in March, the lowest since the U.S. Labor Department began the current system of measurement in 1976. But at the same time that the Magnolia State's unemployment rate was at a record low, it tied for the ninth highest among the states.

Mississippi suffers from a cluster of ills that make it an economic laggard. Only 53 percent of Mississippi adults were working in 2016, the second lowest share of any state. Mississippi's economy depends on slow-growth sectors, including government employment. While nearly 30 percent of Americans older than 25 have a bachelor's degree or higher, only 21 percent of Mississippians do.

The overall size of Mississippi's economy was smaller in 2016 than it was in 2008, and people are beginning to vote with their feet: the state's population has fallen in the last two years.

"I think the population is falling because of the economy," said state economist Darrin Webb. "People have had to go where the jobs are."

That doesn't mean things haven't improved for many people. Economists have long advised that a better-educated, more productive workforce could eventually spur growth. The state's community colleges last year began offering not only adult education classes to high school dropouts, but also free training leading to career certification. Kathryn Winfield, 37, was one of the first graduates.

Returning to the labor force after two years spent caring for her dying father, she earned her high school equivalency degree and became a certified nursing assistant. After nearly a decade making the minimum wage of $7.25 an hour working as a cashier, Winfield is now making more than $13 an hour helping care for nursing home patients. She said the additional pay allows her to better provide for her three kids.

In some ways, Mississippi's economy has healed from the scars of the recession. Archie McDonnell Jr., the CEO of Citizens National Bank, said loan demand has rebounded above prerecession highs at Meridian's largest financial institution, and the bank's profits have more than tripled from their bottom in 2011.

"People just decided, the recession's over, I've got to get back to running my business and investing and doing things," McDonnell said.

McDonnell said he's hopeful about investment in Meridian, noting a $50 million museum being built downtown, an investor seeking to redevelop a derelict 16-story art-deco skyscraper into a hotel, and new ownership at the city's mall.

The number of Mississippians who report being employed could top the precession high when April data is released Friday. But employer payrolls, another way to measure employment, leveled off last year and remains about 1 percent below where they were before Mississippi's economy headed south in early 2008.

It is not just the number of jobs, but what they pay. Workers made an average of $669 a week in Meridian and surrounding Lauderdale County in late 2016, compared to $739 statewide and $1,027 nationwide.

Good wages are the reason that Brown says he has left his hometown of Meridian.

"These are my roots," Brown said. "Meridian will always be home, without a doubt, but you've got to make ends meet and you can't do it here."

___

Follow Jeff Amy on Twitter @JeffAmy. 

All contents © copyright 2017 Associated Press. All rights reserved.

Gov. Asa Hutchinson was the keynote speaker at the conference on the future of the Arkansas Delta at Pine Bluff Convention Center on Friday, addressing representatives from a range of sectors who met to discuss the region’s progress and outlook for its future.

The conference, titled “The Arkansas Delta: Why It Still Matters,” featured a slate of speakers, some of them Delta natives, who brought their expertise to subjects like economic development, entrepreneurship, education, youth issues, conservation, health care, quality of life, history and infrastructure and their overlapping importance. The event was put on by Simmons Bank of Pine Bluff.

Hutchinson touted several of his initiatives impacting those areas, including drawing foreign companies to the state and improving computer literacy in Arkansas schools, and praised the work of Mike Preston, executive director of the Arkansas Economic Development Commission and one of the day’s speakers. Hutchinson noted the state’s 3.5 percent unemployment rate, lowest in recorded Arkansas history, and 70,000 new jobs.

“I understand much of that growth is here in the Delta,” said Hutchinson, who took time to congratulate Pine Bluff Mayor Shirley Washington and the city’s voters for the community improvement and development initiatives Go Forward Pine Bluff and Pine Bluff Rising.

Hutchinson said he recently learned Arkansas leads the nation in foreign direct investment, which includes the recent announcement that China’s largest cotton textile manufacturer, Shandong Ruyi Technology Group, plans to put its first North American manufacturing operation in the Delta town of Forrest City. The project will create about 800 jobs and process 200,000 pounds of Arkansas cotton a year.

“That impacts the Delta,” Hutchinson said.

Other Chinese business deals in the state include Sun Paper’s $1 billion investment in a bio-products mill employing 250 in Clark County near Arkadelphia and a $20 million investment by Suzhou Tianyuan Garments Company in a Little Rock facility that creates 400 jobs.

Hutchinson said he enjoys visiting places like Cuba to pitch Arkansas-grown rice and traveling to China to not only tout Arkansas products and manufacturing possibilities, but the state’s tourism and opportunities.

Hutchinson recounted a duck hunting excursion to the Delta region he arranged for some of China’s representatives and said, based on his experience, the Chinese people are ready to explore some of Arkansas’ unique attractions after getting their fill of the United States’ bigger cities.

“It’s been fun having those relationships, showcasing Arkansas, showcasing the Delta, because let me tell you, we have a lot to be proud of,” Hutchinson said.

Former secretary of transportation Rodney Slater recalled the events in the late 1980s that led to the creation of the Lower Mississippi Delta Development Commission — headed by then-Arkansas Gov. Bill Clinton — the forerunner of the Delta Regional Authority. The authority’s mission is to improve life in the region that touches eight states ranging from southern Illinois to the Gulf of Mexico and its work drew praise from Hutchinson.

“The Delta Regional Authority has been an incredible partner in what we’ve tried to accomplish here in the state,” he said.

Slater spun an image of Arkansas’ highways and interstates as constructions not just of asphalt and steel but as technological and biomedical corridors transporting innovative materials while linking the state’s newest plants and factories.

“What’s your Highway 79,” said Slater, a Marianna native who recalled a childhood car counting game on the highway that captured his imagination. “What’s your Route 66? What’s your Yellow Brick Road? What’s your country road that takes you home?”

“Holistic growth” was a recurring concept and speakers addressed the Delta Regional Authority’s tent-pole categories of basic public infrastructure, transportation infrastructure to facilitate economic development, business development with a focus on entrepreneurship and workforce development and employment-related education using existing public education institutions.

University of Arkansas-Pine Bluff Chancellor Laurence Davis touted his university’s growth and improvement objectives and their impact on the Delta. Shane Speights, dean of New York Institute of Technology’s College of Osteophathic Medicine at Arkansas State University in Jonesboro, addressed the need for further health care education in the state and the university’s efforts to provide it, including the teaching of telemedicine to provide care for people in the Delta’s far reaches.

“The significant programs we chose are based on the needs of Arkansas and people in the Delta region,” Speights said.  

Fitz Hill, executive director of the Scott Ford Center for Entrepreneurship & Community Development and Foundation at Arkansas Baptist College, closed the morning session with remarks on youth development. Hill, the former Arkansas Baptist president, talked about his efforts and policies designed to change mindsets and open up educational and workforce opportunities for troubled and at-risk young people in Delta communities.

“We’ve got to find places to build up, not put down, and we can not be scared in our community anymore,” Hill said.

Two Little Rock lenders continue to battle through losses in search of a return to sustained profitability: Heartland Bank and One Bank & Trust.

What’s on the books and looming in the wings at the two struggling lenders?

Heartland Bank charged off $5.7 million in bad loans and recorded nonaccrual loans of $28.9 million and $7 million in loans 30-89 days past due during the first quarter.

Heartland reported $5.6 million in loan loss reserves and equity capital of $18.2 million as of March 31.

The $205 million-asset lender has ridden a rocky road for earnings for the last six quarters.

Heartland lost nearly $2.4 million in the first quarter.

At One Bank, nonaccrual loans totaled $5.5 million, a $2.3 million increase since Dec. 31. Loans 30-89 days past due stood at nearly $4.3 million.

As of March 31, the $298 million-asset lender carried a loan loss reserve of $3.1 million and total equity capital of $10.4 million.

Quarterly operational losses have dominated One Bank’s performance since Layton "Scooter" Stuart was swept out as CEO in September 2012 and Jerry Pavlas was ushered in to clean up the bank.

During the past five years, One Bank’s ability to turn a profit lending money has dwindled, but the size of its payroll hasn’t changed.

In the first quarter of 2012, the bank recorded net interest income of $3.8 million.

For the recent three months ending March 31, One Bank reported net interest income of $2 million.

Five years ago under Stuart, salary and benefits during the first quarter totaled more than $1.7 million when the headcount of staffers was 96.

Under Pavlas, the roster of employees stood at 72 during the first-quarter census in 2017.

Despite a 25 percent cut in staffing during the past five years, the tally of salary and employee benefits remains at more than $1.7 million.

Heartland and One Bank are both operating under regulatory agreements.

Improving their eroding capital is among the checklist items.

Time is growing short for One Bank to raise new capital or attract a buyer to solve its balance sheet woes.

Change has visited or is on the way at three other lenders striving to operate in the black.

Pinnacle Bank of Rogers merged with Central Bank of Little Rock, and Farmers Bank of Hamburg was acquired by Southern Bancorp of Arkadelphia in a $4.5 million transaction.

Community State Bank of Bradley, the smallest lender in Arkansas, is poised for an ownership change. The bank can’t generate adequate dividends to service the debt of its parent company, Allcorp Inc.

Allcorp is nearly 10 months into a trip to bankruptcy court. The biggest Allcorp debt is more than $1.2 million, the balance of a $2.1 million loan used to finance the purchase of the bank in September 2010.

The creditor: Heartland Bank.

Top Performers
Four of the leading banks in Arkansas were recognized recently as top-performing lenders. The measuring stick used by the Independent Community Bankers of America: three-year average return on assets.

El Dorado’s First Financial Bank ranked No. 6 among lenders with assets of between $300 million and $1 billion with a 3.15 percent ROA during 2014-2016.

Among lenders with assets of more than $1 billion, Little Rock’s Bank of the Ozarks ranked No. 14 at 2.09 percent, Searcy’s First Security Bank ranked No. 16 at 2.08 percent, and Conway’s Centennial Bank ranked No. 22 at 1.83 percent.

ICBA represents more than 5,800 community banks with $4.7 trillion in assets and 52,000 locations staffed by 760,000 nationwide.

First-Quarter Performance
Ranked by return on average equity. Dollars in thousands.

*Formerly Forrest City Bank
Source: Federal Deposit Insurance Corp.

Craig Attwood has joined FBT Bank & Mortgage as executive vice president and director of banking for Jefferson County.

He was previously vice president of the Indirect Lending Division at Simmons Bank in Pine Bluff.

Josh Mascaro has joined the Little Rock office of Stone Bank of Mountain View as vice president and sales manager. He was previously a vice president and sales manager with Simmons Bank and Metropolitan National Bank.

See more of this week's Movers & Shakers, and submit your own announcement at ArkansasBusiness.com/Movers.

The folks at Bear State Bank declined to comment when we asked a couple of months ago about a tip that some 45 employees had been laid off along about the same time that Mark McFatridge resigned as CEO.

So we’ll just point out that the publicly traded Little Rock bank’s latest call report claimed 437 full-time equivalent employees as of March 31. That’s a reduction of 47 from the Dec. 31 call report — almost 10 percent.

Arkansas Blue Cross & Blue Shield of Little Rock, with revenue doubling in the past five years to nearly $2.5 billion, has taken the top spot on Arkansas Business’ annual list of the state’s largest private companies.

As always, that comes with an asterisk: Stephens Inc., the ultra-private investment bank in Little Rock, dropped to No. 2 based on a revenue that continues to be estimated at $2.25 billion. It is the least reliable number on the list and one of only six that have been estimated.

The price of entry to the list increased to almost $117 million from $100 million last year.

ABCBS, a nonprofit that dominates the state’s health insurance landscape, was led from the beginning of 2009 through 2016 by Mark White, who retired at the end of the year. He was succeeded by Curtis Barnett, formerly senior vice president of external operations.

Barnett inherited a company that had $1.27 billion in revenue in 2011. The $2.5 billion it reported in 2016 is not a record for the list: Truman Arnold Cos., which is no longer eligible for the list after moving its executive offices to Dallas, topped $3 billion in 2011 when the price of its main product, aircraft fuel, was sky-high.

The 75 companies on the list generated total revenue, self-reported and estimated, of $37.5 billion, an increase of almost 10 percent from last year’s list. But more than half of that growth is attributable to the highest-ranking debut of any company in the 30-year history of the list: McLarty Automotive Group of Little Rock, led by Mark McLarty. It reported $1.76 billion in revenue in 2016 after having been formed in 2014 to acquire existing auto dealerships and open new ones. (See Dealership Acquisitions Fuel McLarty Automotive Group.)

In what may look like a sibling rivalry, MAG took the No. 4 spot from RML Automotive, which dropped to No. 5 despite revenue growth of almost 13 percent last year. RML was formerly known as RLJ McLarty Landers Automotive Holdings, and was co-founded in 2004 by Mark McLarty’s father and brother, Thomas “Mack” McLarty and Franklin McLarty, with Mark joining as a shareholder.

MAG is the only newcomer to the top 10, displacing Bruce Oakley Inc., the bulk transporter based in North Little Rock, which dropped from No. 7 to No. 12 on a 22 percent decrease in revenue.

Companies whose fortunes are tied to the agriculture industry saw revenue generally flat to lower in 2016, while those working in the health care industry — like ABCBS, Baptist Health (No. 8) and list newcomers Unity Health of Searcy (No. 17) and Central Arkansas Radiation Therapy Institute Inc. (No. 62) — saw revenue growth. (See $1.02 Billion Keeps Baptist Health High on List and Letter Reveals CARTI’s Plan for Improving Finances.)

Welcome Back
McLarty Automotive Group, Unity Health and CARTI are the only true newcomers among the 75 companies on this year’s list. All three should have been on last year’s list but were not surveyed.

Two more companies have returned after being dropped last year:

• No. 59 Parker Automotive Group of Little Rock, which last year submitted an incorrect revenue figure for 2015 that was too low to make the cutoff. It has been corrected.

• No. 74 Multi-Craft Contractors Inc. of Springdale, which entered the list at No. 75 in 2015 but didn’t make the cutoff last year. (See Springdale's Multi-Craft Contractors Stays Flexible, Diverse.)

Making Room
Five companies that were among last year’s 75 had to drop off to make room for the five additional names. They are last year’s Nos. 72-75 — Arkansas Valley Electric Cooperative of Ozark, Mid-South Sales Inc. of Jonesboro, Lewis Automotive Group of Fayetteville and Dyke Industries of Little Rock — as well as SF Holding Corp. of Little Rock, the holding company for joint investments of Warren Stephens and his cousins, Witt Stephens Jr. and Elizabeth Stephens Campbell. Since the Stephenses sold Stephens Media in February 2015 for $102.5 million, SF Holding’s revenue is no longer estimated to be large enough for the list.

Finales
Two companies are making their final appearances on the list: No. 35 Vestcom international Inc. of Little Rock and No. 41 Ridout Lumber Co. of Searcy. Vestcom, which produces the shelf-edge price labels for retailers like grocery stores, was acquired in December by out-of-state ownership, Charlesbank Capital Partners. Ridout, family owned since 1971, was sold in January to US LBM of Buffalo Grove, Illinois.

30th Annual List of Arkansas’ Largest Private Companies

A 244-room hotel in west Little Rock tipped the scales at $13.5 million.

Crowne Plaza Little Rock LLC, led by Wally Allen, sold its namesake hotel at 201 S. Shackleford Road. The buyer is WLR Hotel LLC, led by Shashwat Goyal.

The deal is backed with a four-year loan of $10.2 million from Southern Bank of Poplar Bluff, Missouri.

The 4.22-acre development previously was linked with a December 2012 mortgage of $15 million held by Centennial Bank of Conway.

The location was bought for $2.2 million in January 1985 from Emporia Hotels Inc., led by Don Dreiske.

NLR Retail
A 6,000-SF retail building in North Little Rock weighed in at $2.57 million.

Vic and Victoria Alberti of Clovis, California, acquired the 11951 Maumelle Blvd. project, home to Mattress Firm and Verizon.

The seller is CGP Maumelle MF LLC of Birmingham, Alabama.

The deal is funded with a 25-year loan of $1.57 million from First Symetra National Life Insurance Co. of Seattle.

The 1.03-acre development previously was tied to a $2.1 million mortgage held by Sterling Bank of Poplar Bluff, Missouri.

The site was purchased for $745,000 in December 2015 from Simmons First National Bank of Pine Bluff.

Templars Transaction
A historic 10,041-SF building in downtown Little Rock rang up a $950,000 sale.

The Arkansas Department of Heritage bought the former headquarters of the Mosaic Templars of America at 906 Broadway.

The seller is the Leonal W. Kilgore Revocable Trust.

The 0.31-acre development previously was linked with a January 2006 mortgage of $1.6 million held by First Neodesha Bank of Neodesha, Kansas.

The property was acquired for $1.8 million more than 11 years ago.

The seller was S&D Holdings LLC, led by John Donaldson.

Warehouse Purchase
A 44,640-SF warehouse project in Little Rock changed hands in deals totaling $730,000.

MPV Leasing & Rentals LLC, led by Michael Vogelpohl, purchased the 6200 Patterson Road project and an adjoining 0.57-acre parcel. The sellers are P-Americas LLC of Dallas, $675,000; and Walk-Winn Plastic Co., led by Tommy Walker, $55,000.

The deal is financed with a five-year loan of $568,000 from Arvest Bank of Fayetteville.

The 4.41-acre P-Americas property was assembled in three deals totaling $338,000. The sellers were Mountain Valley Spring Co., $290,000 in May 1967; Industrial Development Co. of Little Rock, led by Everett Tucker Jr., $23,000 in September 1982; and $25,000 in April 1983.

Walk-Winn bought its property in October 1987 as part of a $500,000 deal with the Industrial Development Co. of Little Rock.

Office Acquisition I
A 3,312-SF office building in downtown Little Rock is under new ownership after a $390,000 sale.

H.O.E. Properties LLC, led by Frank Hamlin, acquired the 1101 W. Second St. project.

The seller is 1101 Partners LLC, led by Patty Lueken.

The seller provided a 10-year loan of $350,000 to facilitate the sale.

The 0.2-acre development was purchased for $133,750 in September 2014 from Ann and Walter Pincus.

Cosmetology Sale
A 5,358-SF commercial project in North Little Rock drew a $275,000 transaction.

Clifton Family LLLP, led by Norman Clifton, bought the Lee’s School of Cosmetology project at 2700 Pershing Blvd. from Linda Lee.

The property was acquired for $60,000 in September 1988 from Apartment House Builders Inc., led by John Kincannon.

Office Acquisition II
A 2,300-SF office building in Sherwood sold for $252,000.

Brad Barnett Insurance Agency Inc. purchased the 1610 E. Kiehl Ave. project from Frank Schulte.

The deal is backed with a three-year loan of $252,000 from Bear State Bank of Little Rock. The 0.46-acre development previously was tied to an April 2009 mortgage of $141,000 held by Centennial Bank.

Schulte bought the location for $60,000 in September 1996 from Kiehl Avenue Associates Ltd., led by Maury Mitchell Jr.

River Ridge Abode
A 4,515-SF home in Little Rock’s River Ridge Manor neighborhood changed hands in a $689,000 transaction.

John and Hope Lacey acquired the house from the Rosalyn D. Jacuzzi Revocable Trust.

The deal is funded with a 30-year loan of $200,000 from IberiaBank of Lafayette, Louisiana.

The property was purchased for $67,000 in June 1966 from H.C. and Mevrouw Coburn.

Cliffewood House
A 2,684-SF home in Little Rock’s Cliffewood neighborhood rang up a $655,000 sale.

Henry Barham III and his wife, Jeanne, bought the house from Tyler Kirk.

The deal is financed with a 30-year loan from Regions Bank of Birmingham, Alabama.

The residence previously was linked with a May 2016 mortgage of $675,000 held by Centennial Bank.

Kirk acquired the property for $675,000 a year ago from Kelly and Ellen Kreth.

Maisons Home
A 4,764-SF home in The Maisons neighborhood of west Little Rock’s Chenal Valley development is under new ownership after a $609,000 transaction.

Hal Palmer purchased the house from Omon and Cynthia Hill. The deal is backed with a 30-year loan of $424,000 from Arvest Bank.

The residence previously was tied to a February 2005 mortgage of $472,000 held by Merrill Lynch Credit Corp. of Jacksonville, Florida.

The Hills bought the property for $590,000 more than 12 years ago from Richard Harp Homes Inc.

Riverview Manor
A 3,644-SF home in the Riverview Manor neighborhood sold for $580,000.

Julia Watkins acquired the house from the Schwartz Family Living Trust, led by Michael and Stacey Schwartz.

The deal is funded with a one-year loan of $580,000 from BancorpSouth Bank of Tupelo, Mississippi. The residence previously was linked with a November 2015 mortgage of $400,400 held by Bank of America in Charlotte, North Carolina.

The Schwartz family purchased the property for $515,000 in December 2013 from David and Angela Williams.

Mirabel Dwelling
A 3,784-SF home in the Mirabel Court neighborhood of west Little Rock’s Chenal Valley development drew a $535,000 transaction.

Anthony and Mary Hilliard bought the house from Sharlow Builders & Developers LLC, led by Reggie Clow.

The deal is financed with a 15-year loan of $350,000 from Simmons Bank of Pine Bluff. The residence previously was tied to a December 2016 mortgage of $421,200 held by One Bank & Trust of Little Rock.

The location was acquired for $85,000 in December 2015 from Deltic Timber Corp. of El Dorado.

PV Residence
A 3,904-SF home in west Little Rock’s Pleasant Valley neighborhood rang up a $530,000 sale.

Brock Whisenhunt Jr. purchased the house from the Lorraine Funk Hannah Revocable Trust. The deal is backed with a 15-year loan of $424,000 from Bank of Little Rock Mortgage Corp.

The Hannah family bought the site for $11,000 in May 1971 from Pleasant Valley Inc.

Warren Stephens owes bit a debt to capitalism, and he’s eager to rescue its suffering image.

And as president and CEO of one of America’s top investment banks off Wall Street, Little Rock’s Stephens Inc., he is in an ideal position to get the word out.

Stephens Inc. announced Monday that it has launched a multimedia series called “This Is Capitalism,” featuring short films on some of the heroes of capitalism in the United States, including Warren Stephens’ father, Jackson T. Stephens. The films, articles and other content featuring influential American business leaders, historians and academics is available here.  

Jack Stephens, along with his brother Witt, who founded the company in 1933, guided the Arkansas firm as it pumped billions of dollars into the American economy over the decades, fueling deals like Wal-Mart’s initial public offering, the bond issue that built the Superdome in New Orleans and Tyson Foods’ acquisition of Holly Farms.

Warren Stephens, who became CEO in 1986, was estimated by Forbes in 2016 to have a fortune of $2.4 billion. So, yes, capitalism has been good, but not just good for financiers, Stephens says.

“In recent years, capitalism has been recast as a system that enriches a few at the expense of the many; a force that divides people by class and achievement rather than one that is agnostic in opportunity,” Stephens said in introducing the film series.

The series confronts what Stephens sees as a negative narrative that has damaged capitalism’s image where it should be appreciated most, in the United States. He cited a 2016 Harvard Institute of Politics  poll finding that 51 percent of millennials do not support capitalism.”

Stephens said he has become increasingly concerned by this shift and what it means to the country.

“No other economic system has lifted more people out of poverty than capitalism,” he said. “It is why America today serves as the gold standard across the globe. It is time to reclaim the term…”

To that end, films on Alexander Hamilton and Madam C.J. Walker are already posted on the website. Hamilton, the immigrant who became the first U.S. secretary of the treasury and the “father” of the American economic system, is more than a muse for Broadway. He established a national bank, undergirded the American currency and established the nation’s credit. “A national debt, if not excessive, will be to us a national blessing,” he said.

Walker, born on the same plantation in Louisiana where her parents were slaves, became the country’s first African-American self-made millionaire, producing and marketing hair care products.

In June, short films will appear on Helena Rubinstein, the Polish immigrant who conquered the beauty industry, and Jack Stephens, who transformed not only Stephens Inc., but also Arkansas and the financial services industry in the state. July will bring two more films, on Chuck Williams, the veteran who made Williams Sonoma into a foodie and cookware empire; and Sam Walton, the legendary Wal-Mart founder.

ThisIsCapitalism.com also features articles by entrepreneurs and business executives, as well as frequently asked questions and other features.

“It is our hope that with these uniquely American stories we will start a dialogue about the positive impact free-market enterprise has on our country and communities,” Stephens said.

Bank of the Ozarks Inc. on Wednesday announced that it will sell 6.6 million shares of common stock in a public offering and expects gross proceeds from the sale to be $302.3 million before underwriting discounts and offering expenses.

The Little Rock company has also granted the underwriter a 30-day option to purchase up to an additional 990,000 shares of its common stock. It expects gross proceeds to increase to $347.6 million if that option is exercised in full.

Closing of the offering is expected on or about May 31. J.P. Morgan is acting as sole book-running manager.

The company said it would used proceeds from the sale to support its growth, including growth in non-purchased loans and leases, for potential future acquisitions and for general corporate purposes.

The Simmons First National Corp. board of directors on Thursday declared a regular $0.25 per share quarterly cash dividend payable July 3, to shareholders of record June 15.

This dividend represents a 1-cent per share, or 4.2 percent, increase above the dividend paid for the same period last year.

Simmons First National Corp. is a financial holding company headquartered in Pine Bluff.

On April 19, the company reported first-quarter net income of $22.1 million, down 6 percent from the same quarter last year.

Simmons First National Corp. on Friday named Susan Lanigan of Nashville, Tennessee, to its board of directors.

Lanigan has been executive vice president and general counsel of Chico’s FAS Inc. since 2016. She served as general counsel of Dollar General Corp. from 2002-13 and was executive vice president of Dollar General from 2005-13.

Simmons said Lanigan helped guide Dollar General through a $7 billion leveraged buyout, a subsequent initial public offering and its return to public company status. During her time there, the company increased its store count from about 5,000 to more than 10,000 and grew annual revenue from $11 billion to $18 billion.

Before joining Dollar General, Lanigan served as in-house counsel for Turner Broadcasting System Inc. and as senior vice president, general counsel and secretary of Zale Corp.

Lanigan has been a director of Kirkland’s Inc. since June 2016 and chairman of the Tennessee Education Lottery Corp. since 2014.

As director of the Arkansas District Office of the U.S. Small Business Administration, Edward Haddock is responsible for all SBA programs and services as well as coordination among the SBA, the district’s Small Business Development Centers, SCORE chapters and the Women’s Business Center throughout the state.

Haddock started his SBA career in 2011 as an economic development specialist in the agency’s Newark, New Jersey, office. He was promoted to senior area manager in Fayetteville in 2013, was named the SBA’s Arkansas deputy district director in May 2015 and was named director in January 2017 on the retirement of Linda Nelson.

Haddock has an MBA from Rutgers University and a bachelor’s in organizational management from John Brown University. He also spent 12 years in the U.S. Air Force, including deployments in both humanitarian and combat operations.

What are some functions of the SBA that readers might not be aware of?

Most people know about the SBA’s lending side, where we offer a loan guaranty to help increase capital access to small businesses. What most people don’t know is that the SBA has an Office of the Ombudsman, which helps ensure regulatory fairness for our small businesses, and an Office of Advocacy, which advances the views and concerns of small business before Congress, the White House, federal agencies, the federal courts and state policymakers. We also have programs for trade development, contracting assistance, no or low-cost training and disaster relief for businesses and individuals. We touch almost every aspect of small business.

Can you share the success story of an Arkansas business whose help from the SBA really made a difference?

Our recent winner of SBA’s Small Business Person of the Year is a great example of what benefits can be gleaned from working with the SBA. Vision IT of Little Rock, led by Victoria Washington, made incredible progress growing through several SBA programs. Certifying as an 8(a) company gave her organization preference in the federal procurement process, where she was successful in garnering several large contracts. She spent close to eight months completing SBA’s Emerging Leaders program, where she refined her business acumen and gained MBA-level tools to use in the management of her business. She led her business from $74,000 in revenue with zero employees to more than $3 million in revenue. Her organization also hired 21 employees within three years. Companies like Vision IT are why small business is one of the most powerful economic development tools available.

You’re an Air Force vet. How does your military service influence the way you perform your job?

I was trained according to a set of core values that stay with me in my daily work: integrity first, service before self and excellence in all we do. These guiding values help me stay on track, embrace our mission and develop our team into an efficient cohort that is fully dedicated to helping small businesses start, grow and succeed.

What’s the greatest career mistake you’ve made and what did you learn from it?

I have had numerous learning opportunities in my career, and I don’t consider any of them a mistake. Each opportunity has provided me a greater opportunity to learn and grow.

I had a challenging time separating from the military; in many ways, that separation taught me more about who I really am than the 12 years I spent serving. I’ve had unsuccessful business launches, which taught me more about business than any successful operation ever did. Each of these growth points taught me patience, resilience and optimism, and helped me get where I am today.

The hardest part of our own mistakes is the journey through it, when we’re at the lowest point. That’s when they seem more like setbacks than useful lessons. I think it’s important to have the desire, strength and foresight to continue on; often if we can just push through, success will be just ahead. And being willing to seek out the support that’s available to us is key as well.

A Missouri investor bought a Fayetteville apartment complex for $8 million.

Patrick O’Reilly of Springfield bought the South Creekside Apartments through Fayetteville Multifamily Apartments LLC. O’Reilly is the head of O’Reilly Development Co., which specializes in student and multifamily housing.

The 8.3-acre, 126-unit complex at 900 N. Leverett Ave. is four blocks from the University of Arkansas campus.

ALS Management LLC of North Little Rock sold the property. ALS, led by Arby and Angela Smith, received a 20-year, interest-free loan worth $7.75 million from the Arkansas Development Finance Authority in Little Rock to buy and renovate the apartments in 2009.

O’Reilly assumed the $6.88 million outstanding principal balance on the loan from the ADFC. The Bank of Fayetteville had acquired the property in lieu of foreclosure from Garden Park Apartments LLC, led by Steve Mansfield.

Third Bank a Charm?
A two-time bank branch on West Wedington Drive in Fayetteville has a new owner, and to no surprise it is a bank. Citizens Bank of Batesville paid $2.2 million for a former Simmons Bank branch at 3971 W. Wedington. The 3,442-SF site was a Metropolitan Bank location before Simmons First National Bank of Pine Bluff acquired Metropolitan National Bank of Little Rock for $53.6 million in 2013.

Simmons closed the branch, which had $3.2 million in deposits, on July 1, 2016. It had a $4.7-million branch, based on statistics from June, a couple of miles away on Martin Luther King Jr. Boulevard at the time.

Citizens has been expanding under CEO Phil Baldwin’s, pushing into Rogers, as well as Hot Springs, Arkadelphia and Monticello, through a $21.8 million acquisition of Parkway Bank.

Zweig Buys Apartments
Developer Mark Zweig paid a little more than $1 million for an apartment complex at 944 N. Storer Ave. in Fayetteville.

Mark Zweig Inc. bought the property from AJ Hammock LLC, led by Jeffrey Rich and Amy Lynn Farmer of Fayetteville. The three-story complex has 20 one-bedroom units and 10,500 SF of living space.

Signature Bank of Fayetteville provided a loan of almost $1.3 million.

Contractors Consolidation
Multi-Craft Contractors of Springdale purchased five acres next to its headquarters on Lowell Road for $1.1 million.

One parcel was 3.5 acres and the other was 1.5, and both were owned by Henry Cantrell of Benton, Louisiana. The properties are at the northwest corner of Lowell and West Randall Wobbe Lane, just south of Multi-Craft’s main location.

The two warehouses on the property will add 56,000 SF to Multi-Craft. Multi-Craft bought the property through its BLK LLC, led by Rick Barrows, Multi-Craft’s president and majority owner.

Barrows, in an interview earlier this month, said the company had 35,000 SF rented throughout Springdale and wanted to consolidate its entire workforce at its central location.

BLK agreed to pay Cantrell $900,000 by 2027.

Hunan Manor Restaurant
A Rogers investor paid more than $1.5 million for a retail strip anchored by the Hunan Manor restaurant on North Tahoe Place in Fayetteville.

Zheng Lin LLC, led by Jian Fei Lin, bought the property from EEE-GE LLC of Fayetteville, a five-person ownership group. The 1.1-acre site has 5,420 SF shared by Hunan Manor and BoBo’s Ribbon Ice.

Arvest Bank of Rogers provided a loan of slightly more than $1.2 million.

In the past year, Lin has bought Joyce Plaza in Fayetteville for $3.7 million, the Arbors Apartment complex in Springdale for $2.4 million before selling it for $3.05 million seven months later and the Casa Villa Shopping Center in Springdale for $750,000.

Shoulder Center
A medical office in Fayetteville sold for $1.375 million.

One Sixty One Holdings LLC, led by Monte Sharits of Fayetteville, bought the 7,328-SF building that houses the Shoulder Center, an orthopedic clinic led by surgeon Wesley Cox. Generations Bank of Fayetteville assisted the purchase with a loan of a little more than $1.4 million.

NWA Investors I LLC, led by Leonard Boen of Little Rock, was the seller.

A 67,935-SF mini-storage project in North Little Rock weighed in at $3.3 million.

Modern Storage Maumelle Blvd LLC, led by Keith Richardson, purchased its namesake at 9100 Maumelle Blvd. The seller is JWL I Ltd., led by William Titus.

The deal is financed with a five-year loan of $2.9 million from First Security Bank of Searcy.

The 4.16-acre development previously helped secure a December 2012 mortgage of $5.6 million mortgage held by Southern Bancorp Bank of Arkadelphia.

JWL bought the property for $2.15 million in July 1998 from the Lusk Family LLC, led by Jo O’Bryant Lusk.

Warehouse Sale I
A 59,404-SF cold storage warehouse in east Little Rock tipped the scales at $1.75 million.

Sage V Foods LLC of Los Angeles acquired the facility at 6100 Lindsay Road from Ben E. Keith Co. of Fort Worth, Texas.

The 5.7-acre development was purchased for $1.3 million in November 1987 from the estate of Theo A. Dillaha Sr.

Warehouse Sale II
A 56,880-SF warehouse in downtown Little Rock changed hands in a $1.38 million sale.

Pierce Smith LLC, led by Tyler Pierce and Blake Smith, bought the Golf Cart Wholesalers project at 1515 E. Fourth St. The seller is 1515 Holdings Inc., led by Nick Pierce and Paul Cantrell.

The deal is backed with a five-year loan of $2.1 million from Eagle Bank & Trust of Little Rock.

The 1.7-acre development previously was tied to an October 2016 mortgage of $1.4 million held by Little Rock’s Bank of the Ozarks.

The property was acquired for $525,000 in December 2009 from Harbor Distributing Co., led by Nick Pierce.

Chick-fil-A Site
A 1.49-acre commercial location in Maumelle rang up a $1.1 million transaction.

Chick-fil-A Inc. of Atlanta purchased the land near the northeast corner of Maumelle Boulevard and Odom Boulevard South.

The sellers are R&L Properties, led by Tommy Lasiter, $606,000; BAT REP LLC, led by Bruce Thalheimer, $202,000; and WMBS LLC, led by Warren Stephenson, $202,000.

The property helped secure a June 2013 mortgage of $2 million held by BancorpSouth Bank of Tupelo, Mississippi.

The site was bought in June 2004 as part of a $3.4 million deal with Capitol Development of Arkansas Inc., led by Michael Todd.

Industrial Purchase
A 35,600-SF industrial facility in east Little Rock sold for $950,000.

STT Inc., led by Shirley Heatherly, acquired the HD Supply project at 8915 Fourche Dam Pike.

The seller is AWP Investments LLC of Owasso, Oklahoma.

The deal is funded with a two-year loan of $760,000 from Merchants & Planters Bank of Newport.

The 7.23-acre development was purchased for $875,000 in March 2003 from Cepco Inc., led by Keith Riggs.

Zaxby’s Location
A Zaxby’s project is in motion in west Little Rock after a $597,879 land deal.

Quapaw Properties III LLC of Milledgeville, Georgia, bought the 1.12-acre site at the southwest corner of Kanis and Kauffman roads from Akshar 8 LLC, led by Dr. Shailesh Vora.

The deal is financed with an 11-year loan of $1.9 million from Planters First Bank of Cordele, Georgia.

The property previously was linked with a February 2016 mortgage of $375,000 held by Arvest Bank of Fayetteville.

Akshar 8 acquired the land for $500,000 15 months ago from Glenda C. Pehrson Family Ltd. and GCP Holdings LLC, led by Susan Pehrson.

Vet Redevelopment
A 6,850-SF retail building in Jacksonville drew a $435,000 transaction.

Elson Properties LLC, led by Jodie Freifeld, purchased the former Advanced Auto Parts store at 1304 N. First St. from Harold Gwatney Chevrolet Co.

The redevelopment into a veterinary facility is backed with a $1.4 million loan from Live Oak Banking Co. of Wilmington, North Carolina.

The auto dealership bought the 0.77-acre development for $350,000 in June 2015.

The seller was the Shefflette Family Trust, led by Patrick and Lois Shefflette.

Church Ground
A Little Rock congregation staked its $420,000 claim on a 5.48-acre tract in west Little Rock.

First Christian Church acquired the land near the northeast corner of Taylor Loop and Hinson roads from the Julia M. Pierce Living Trust.

The property was purchased in three transactions totaling $1,213.

The sellers included William Karzinaucki, $63 in August 1941; and Pearl Martin, $150 in August 1942. Rounding out the sellers are Chester and Etta King, $1,000 in January 1963.

Arbors Abode
A 4,115-SF home in The Arbors neighborhood of west Little Rock’s Chenal Valley development rang up a $620,000 sale.

Edwin and Kathy Watson bought the house from Regions Bank of Birmingham, Alabama.

The bank recovered the house from Gary Hendershott in December at a $618,750 foreclosure sale.

Mirabel Dwelling I
A 3,983-SF home in the Mirabel Court neighborhood of west Little Rock’s Chenal Valley development changed hands in a $598,000 transaction.

Matthew and Morgan Wilkins purchased the house from HA Custom Homes LLC, led by Subrabmanyam Narravula.

The deal is funded with a 30-year loan of $476,000 from First State Bank of Russellville.

The residence previously was tied to a September 2016 mortgage of $445,600 held by One Bank & Trust of Little Rock.

The site was bought for $84,000 in June 2016 from Clinton Properties LLC, led by Bruce Clinton.

Riverview Manor
A 3,644-SF home in the Riverview Manor neighborhood rang up a $580,000 deal.

Julia Watkins acquired the house from the Schwartz Family Living Trust, led by Michael and Stacey Schwartz.

The deal is financed with a one-year loan of $580,000 from BancorpSouth Bank.

The residence previously was linked with a November 2015 mortgage of $400,400 held by Bank of America in Charlotte, North Carolina.

The Schwartz family purchased the property for $515,000 in December 2013 from David and Angela Williams.

Mirabel Dwelling II
A 3,784-SF home in the Mirabel Court neighborhood of west Little Rock’s Chenal Valley development sold for $535,000.

Anthony and Mary Hilliard bought the house from Sharlow Builders & Developers LLC, led by Reggie Clow.

The deal is backed with a 15-year loan of $350,000 from Simmons Bank of Pine Bluff.

The residence previously was tied to a December 2016 mortgage of $421,200 held by One Bank & Trust.

The location was acquired for $85,000 in December 2015 from Deltic Timber Corp. of El Dorado.

PV Residence
A 3,904-SF home in west Little Rock’s Pleasant Valley neighborhood rang up a $530,000 sale.

Brock Whisenhunt Jr. purchased the house from the Lorraine Funk Hannah Revocable Trust. The deal is funded with a 15-year loan of $424,000 from Bank of Little Rock Mortgage Corp.

The Hannah family bought the site for $11,000 in May 1971 from Pleasant Valley Inc.

Multimillion-Dollar Construction

Madison at Chenal    $20,300,000
15401 Chenal Parkway, Little Rock
Huffman Contractors Inc., Little Rock
 
Tru By Hilton    $4,500,000
11320 Bass Pro Parkway, Little Rock
Integrity Construction of Arkansas Inc., Little Rock

Jared Gabriele has been hired as an assistant vice president and loan officer at Grand Savings Bank for the bank’s Rogers market. He previously was a mortgage closer at Arvest Bank.

Ron Branscum has been hired as city president for Rogers at Citizens Bank. He previously was the president of Regional Therapy Services Inc. in Rogers.

Don Moseley has been hired as a business development associate for national accounts at Entegrity in Fayetteville. He was previously senior manager of sustainable facilities at Wal-Mart.

Nicole Reid has been hired at Sparks Clinic Lung Center in Fort Smith as an advanced practice registered nurse. She was previously a registered nurse in the intensive care unit at Sparks Health System in Fort Smith.

Joey McCutchen received the 2017-18 President’s Gavel and the Roxanne Wilson Advocacy Award from the Arkansas Trial Lawyers Association at its annual convention in Eureka Springs. He is the founder of McCutchen & Sexton of Fort Smith.

Other award recipients include the following:

• Tré Kitchens of the Brad Hendricks Law Firm in Little Rock, recipient of the Outstanding Trial Lawyer Award
• Judge John Homer Wright of the 18th East Judicial Circuit, recipient of the Trial Judge of the Year Award
• Frank Bailey of the Bailey & Oliver Law Firm in Rogers, recipient of the Henry Woods Lifetime Achievement Award
• State Rep. Jimmy Gazaway of Paragould, recipient of the Consumer Advocate Award
• Retired Col. Mark Ross of North Little Rock, recipient of the Citizen Merit Award
• Josh Gillispie of Green & Gillispie Attorneys at Law in Little Rock, recipient of the Outstanding Member of the New Lawyer Division
• Kathleen Monk of Springdale, recipient of the Outstanding Paralegal Award.

Officers named during the convention include President-elect Jesse Gibson of the Gibson Law Firm in Little Rock, Vice President Bryce Brewer of the Bryce Brewer Law Firm in Little Rock and Secretary/Treasurer Alan Lane of the Odom Law Firm in Fayetteville.

See more of this week's Movers & Shakers, and submit your own announcement at ArkansasBusiness.com/Movers.

Arkansas mortgage brokers and other financial professionals in the state have to comply with new licensing and bonding rules. The changes were introduced by a new piece of legislation — House Bill 1801, now Act 669 of 2017 — which took effect March 27.

The bill amends the Fair Mortgage Lending Act. Anyone affected by the actions of a licensed Arkansas mortgage broker will now be able to file a claim against the broker bond up to five years after the broker has ceased operations in the state. This provides extended protection for mortgage buyers who have suffered misuse or fraud by a mortgage professional. Mortgage professionals will also have to meet a different set of licensing requirements.

Some criteria that were needed previously are removed, while new ones have been added. With the new legislation, Arkansas mortgage brokers will now be accountable for mortgage broker bond claims for a period of at least five years after the end of their activities in the state.

The surety bond is one of the main licensing requirements for mortgage brokers across the country. The licensing and bonding in Arkansas are regulated by the Arkansas Securities Department. It requires brokers to post a mortgage broker bond based on their loan activity, with a minimum amount of $100,000. The amendments in the bill allow the commissioner to set the bond amount as deemed necessary. However, the actual submission of the bond still needs to be made via the National Mortgage Licensing System. The bond form is available online.

The bond functions like an extra layer of protection for Arkansas loan buyers. If a mortgage broker fails to abide by applicable laws and engages in misuse and fraud that negatively affect a customer, a claim can be made on the bond. The new legislation clearly states that “any person who has a cause of action” can file a suit on the bond.

If a bond claim is proven, the affected parties can get a reimbursement up to the penal sum of the bond. The surety that has bonded the broker covers the expenses at first, which guarantees that the claimants will receive the compensation. The mortgage broker is then liable to repay the surety in full for all incurred costs.

Besides introducing stricter rules for mortgage broker bond claims, Act 669 makes a number of changes in the licensing for mortgage brokers and other financial professionals in Arkansas.

Previously, the licensing process entailed that the business history, qualifications and financial situation of the applicant and any officers, partners, directors and managing principals must be examined. With the new law, only the applicant and any managing principals must provide their personal and financial information.

A new requirement was added to the licensing as well. Now mortgage professionals need to undergo fingerprinting. It can be used by the FBI and any other relevant authority. The rest of the licensing criteria and fees remain the same.

Additionally, there are some changes that affect mortgage servicers only. When a servicer takes on the servicing rights on a loan, he must disclose to his clients proof of his licensing. He must also provide borrowers with any notice required under the Real Estate Settlement Procedures Act of 1974.

Vic Lance is the founder and president of Lance Surety Bond Associates of Doylestown, Pennsylvania. Email him at Marketing@SuretyBonds.org.

Editor’s Note: This is the latest in a series of business history feature stories. Suggestions for future Fifth Monday articles are welcome. Please contact Gwen Moritz at (501) 372-1443 or GMoritz@ABPG.com.

Not many people know that John Rogers was a millionaire real estate investor before he began serious work building his sports memorabilia and photo empire in North Little Rock.

That’s because he wasn’t. It’s a big, fat lie.

Rogers didn’t own the largest day care center in the South either. That is another of his lies.

He didn’t find a way to spin straw into gold by acquiring newspaper photo archives in exchange for creating a digital library and profitably selling the images for millions and millions of dollars either.

That was an ongoing lie that got fatter with each passing year of inflated revenue claims, and it ultimately contributed to his undoing.

It seems one of the youngest Eagle Scouts forgot the first words of the Scout Law: “A Scout is trustworthy …” (See When Scouts Go Bad below.)

Rogers’ lying ways finally caught up with him three years ago after federal investigators, creditors and investors began discovering and revealing that his bluster had crossed over to the realm of criminal fraud.

Rogers didn’t lie to his lenders in a desperate move to save his company because of a downturn in the economy. That was a lie on top of a lie he told to mitigate his criminal acts.

In a truthful moment, standing before a federal judge on March 6 to plead guilty to wire fraud, Rogers provided a simple explanation for his felonious lies.

“It was for personal gain,” said Rogers, according to the Chicago Tribune. “Greed.”

The money he raked in from his bogus sports memorabilia tactics and wheeling and dealing of photo collections funded a fabulous lifestyle for him and his family. As a convicted felon, he wistfully described it as “a once amazing life.”

Along the way, Rogers wrote big checks and made donations to charities, too.

“He’s certainly generous,” said one formerly close associate. “With other people’s money.”

Other people’s money also provided the financial foundation for his big-time business endeavors. But once upon a time, Rogers claimed his personal real estate fortune as the initial funding source for his photo archive business.

That’s what he told Chris Olds, editor of Beckett Baseball. On Sept. 20, 2011, Olds posted online a question and answer session with Rogers that included this exchange:

What kind of capital did it take to start the business, and what kind of range is there for your purchases?

“To pursue this, I liquidated real estate holdings that I had and was able to self-finance the start with a $10 million investment,” Rogers answered. “There was not only the acquisition of photo archives, but the investment in equipment, staff, headquarters and more. It took millions, and ultimately, financial institutions began to pursue us to back our business.”

(The following year he would tell his story to the Arkansas Times, omitting any claim of a real estate fortune and focusing on his humble roots in North Little Rock and his baseball card trading prowess while a college student.)

Big Bounced Checks
That part about financial institutions pursuing his business was premature. Lenders didn’t begin ardent pursuit of Rogers until they started suing him in 2014 for nonpayment of loans.

His relationship with three banks that provided financing for his business dealings all came through introductions, according to sources and court filings.

Rogers struck up his first significant banking relationship for his growing photo archive business back in 2009.

That relationship with Heartland Bank came after he made news in 2008 for buying a rare Honus Wagner baseball card for a purported $1.6 million. But the relationship with Heartland grew tense as irregularities in his accounts began to grow.

Among the problems were bounced checks, really big bounced checks that resulted in six-figure overdrafts.

Finally, Rogers was warned if it happened again Heartland officials would have to file a suspicious activities report that the movement of money in his account showed signs of money laundering or fraud.

There was talk of Heartland expanding its financial relationship, but only if Rogers agreed to hire a chief financial officer, produce audited financial statements and provide the bank with the additional security of warrants for possible ownership in his business if things went sideways.

Rogers didn’t have any interest in those conditions, and thanks to a new acquaintance he had made, a replacement for Heartland was at hand.

William “Mac” Hogan introduced Rogers to First Arkansas Bank & Trust in Jacksonville after making several seemingly lucrative sports memorabilia investments with him. That led to a financial relationship between the bank and Rogers in December 2011.

Hogan had a longtime relationship with Larry Wilson’s bank through his Jacksonville business interests, which included ownership of PoloPlaz Inc., a wood floor coatings manufacturer.

Hogan’s confidence was won over by personal investments with Rogers that delivered big returns and paid like clockwork. Both Hogan and Wilson would later learn that many of Rogers business deals were nothing more than pieces of a Ponzi scheme.

If ever a lender should be happy to have lost a customer, great must be the rejoicing at Heartland Bank.

At last count, First Arkansas Bank & Trust has a $15.5 million judgment against Rogers on unpaid loan guarantees. Some of that money was used to repay the outstanding debt at Heartland.

Hogan also introduced Rogers to Pete Maris and his Bank of Little Rock in late 2013. A month before the federal fraud investigation of Rogers became public, the bank loaned Rogers $900,000 on Dec. 23 to buy scanning equipment.

To add urgency to the loan request, Rogers said the deal represented a $200,000 savings if the equipment could be bought before Christmas.

But it was another phantom deal concocted by Rogers. The transaction was phony. The invoice was fake. The company selling the nonexistent equipment was a corporate figment created by Rogers, who absconded with the money.

‘Counterfeiting Machine’
According to former associates, it wasn’t the first time Rogers committed bank fraud. During his run with Heartland Bank, Rogers pledged assets he didn’t own to help secure funding from the bank.

The serial numbers corresponded to real equipment, but Rogers didn’t own it.

“I know we borrowed a lot of money,” said one former staffer at Rogers Photo Archives. “I know we were selling a lot of stuff on eBay. I thought we had the potential to make money.

“I think it could’ve been successful if he had just taken his time with it. But he’s just not that kind of guy.”

After hearing of his lucrative payouts, one North Little Rock businessman met with Rogers about the possibility of investing circa 2011. His recollection of the dialogue:

“Tell me how this deal works,” he said.

“I only take $100,000-$250,000 and pay 25 percent quarterly,” Rogers said.

“Do what? When he told me that — and I had read in the Arkansas Democrat-Gazette about how much business he’s doing — I wondered ‘Why would he offer me this high of a return?’”

While some outsiders were questioning the math of it all, some insiders were laughing and shaking their heads over how much money Rogers was telling the media he was making.

A forensic audit of his business records in 2014 uncovered that Rogers booked borrowed money as revenue, which pumped up the balance sheet. The appraised insurable value of assets was twisted into appraised value.

“Money coming in as loans or investments was shown as revenue or sales,” said Roger Rowe, attorney for First Arkansas Bank & Trust. “All of the tax returns he gave to the IRS and the bank were all wrong. They were fraudulent.”

Some believe the small day care business that Rogers and his then-wife, Angelica, owned is what provided Rogers with his first real taste of financial success. “That really got him started,” said a source familiar with his business dealings. “That was his cash cow.”

Others believe years of producing and selling counterfeit sports memorabilia was an even bigger source of income.

“He was a counterfeiting machine, a fake memorabilia machine,” said one former associate.

In an email once posted on his Facebook account in April, Rogers lamented: “I have shit all over a once amazing life. I have lost everything, including my freedom.”

His sentencing hearing in Chicago’s U.S. District Court is scheduled for Sept. 12.

An El Dorado businessman recently filed for Chapter 7 bankruptcy liquidation, listing $3.3 million in debts and $4.4 million in assets.

Darrell Lee Madding operated several businesses in the last eight years. The list includes All-Star Recycling-Magnolia LLC, All-Star Transportation LLC, D&D Properties LLC, Madding Real Estate Holdings LLC and Triple M. Contractors LLC, according to his bankruptcy petition filed in U.S. Bankruptcy Court.

One of his largest creditors is Homebank of Arkansas, headquartered in Damascus, which has a $575,000 claim secured by property that Madding said is worth $2.9 million. He also has a $1.3 million unsecured debt to Metal Recycling Corp. of Little Rock and more than $100,000 in credit card debt.

From January through May 12, Madding had a gross income of $30,000. In 2016, it was $108,000, but in 2015, it was only $23,740.

Madding’s bankruptcy attorney, Kyle Havner of White Hall, declined to comment.

More pieces have surfaced in the financial workout of the Main Street Lofts project in downtown Little Rock.

AMR Construction LLC now holds an $824,784 first mortgage claim on the 62,688-SF M.M. Cohn Building at 510 Main St. The change positions the property for a possible sale that would repay the Little Rock contracting firm.

AMR took the mortgage in exchange for releasing its lien claims for unpaid work that blossomed into an $896,756 judgment. The judgment was against the Main Street Lofts ownership group, originally led by Scott Reed of Portland, Oregon.

New low-profile investors are in town cleaning up the problems left by Reed with the intention of restarting construction and completing the project this year.

After earlier paying delinquent property taxes on the M.M. Cohn Building, the Deep Creek LR group also repaid delinquent 2013-15 property taxes on the project’s other two buildings.

Those tax bills totaled $20,979 on the 41,816-SF Arkansas Building at 524 Main St. and $16,219 on the 21,000-SF Arkansas Annex 514 Main St.