Shane Smith, the former Chief Financial Officer of Reagor Dykes, filed his written defense in federal court on Tuesday in an ongoing lawsuit.
On September 18, First Bank & Trust sued Reagor Dykes, FirstCapital Bank, Bart Reagor, Rick Dykes, Shane Smith, Sheila Miller, Brad Burgess, and Kenneth Burgess.
Among other things, FB&T claimed that FirstCapital profited from check kiting by Reagor Dykes. FirstCapital denies the allegations.
Check kiting is a way of making a checking look like it has money when in fact the money is not really available. It’s illegal.
On August 1, Reagor Dykes filed for bankruptcy which is the same day Smith was fired.
In a separate lawsuit, Dykes’ put the blame on Smith for false financial statements saying, “Mr. Smith made a stunning disclosure. Mr. Smith admitted that he had provided false financial information regarding the Reagor-Dykes dealerships to Ford Credit and Messrs. Dykes and Reagor.”
Smith’s defense on Tuesday raised a long list of legal technicalities. Some of Smith’s arguments blamed FB&T (the plaintiff). They included:
• Plaintiff’s own acts or omissions caused or contributed [to the problem]
• Plaintiff ratified the actions of Smith.
• Plaintiff’s claims against Smith are barred, in whole or in part, because of a mutual and/or unilateral mistake
• to the extent any representations were false, Plaintiff knew of the falsity of the representation
Regarding many of FB&T’s claims in the original lawsuit, Smith’s response was, “Smith lacks knowledge or information sufficient to form a belief about the truth of the allegations…”
Three local banks have accused Reagor Dykes of check kiting. Ford Motor Credit Company accused Reagor Dykes of both default and fraud.
The FB&T lawsuit is one of several ongoing court cases related to Reagor Dykes.
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