FAYETTEVILLE, AR- Five people have appeared in federal court in Northwest Arkansas facing bank fraud, bankruptcy fraud, wire fraud, and money laundering charges.
The charges stem from alleged schemes to defraud involving several Northwest Arkansas real estate transactions and 37-year-old Brandon Barber’s bankruptcy case.
Barber and his four co-defendants appeared before United States Magistrate Judge Erin L. Setser in United States District Court today for arraignment.
The five pleaded not-guilty to all charges.
Barber and co-defendants K. Vaughn Knight, age 46 of Fayetteville; James Van Doren, age 37 of New York; Jeff Whorton, age 45 of Johnson, Arkansas; and Brandon Rains, age 32 of Springdale, Arkansas were indicted on January 16, 2013 and March 6, 2013 in two separate indictments.
The defendants have been released on bond pursuant to standard pre-trial conditions of release subject to a special condition prohibiting them from incurring any new financial debt.
In addition, Barber is confined to home detention and subject to GPS monitoring.
The indictments allege several schemes to defraud banks, creditors, and the Federal Bankruptcy Court beginning in 2005 to 2009.
Those schemes include:
(1) Barber allegedly provided false and fraudulent financial information and statements to Legacy National Bank of Springdale in connection with loans to finance the Legacy Condominium building and project in Fayetteville;
(2) Barber allegedly provided false and fraudulent financial information and statements to Metropolitan National Bank of Little Rock and Enterprise Bank of St. Louis, Missouri, in connection with loans to finance the Bellafont project in Fayetteville;
(3) Barber, Van Doren, and Knight allegedly concealed assets and income from creditors and the bankruptcy court by transferring Barber’s funds to Van Doren and Knight or accounts controlled by them and using those funds for Barber’s personal benefit and expenses; and
(4) Barber, Whorton, and Rains falsely and fraudulently represented purchase prices for real estate to First Federal Bank of Harrison, Arkansas, to obtain loan amounts exceeding the actual purchase prices and thereby generating excess cash without the Bank’s knowledge or approval.
This case is being investigated by the Internal Revenue Service Criminal Investigation Division and the Federal Bureau of Investigation. United States Attorney Conner Eldridge, First Assistant United States Attorney Wendy Johnson, and Assistant United States Attorneys Glen Hines and Benjamin Wulff are prosecuting the case for the United States.