Attorney General announces $300,000 lawsuit against Bailey’s Superstore

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Arkansas Attorney General Leslie Rutledge with a bipartisan group of state attorneys general speaks to reporters in front of the U.S. Supreme Court in Washington, Monday, Sept. 9, 2019. A bipartisan coalition of 48 states along with Puerto Rico and the District of Columbia said Monday it is investigating whether Google’s search and advertising business is engaged in monopolistic behavior. It follows a Friday announcement of a similar multistate probe targeting Facebook. (AP Photo/Manuel Balce Ceneta)

LITTLE ROCK, Ark. – Attorney General Leslie Rutledge announced a judgment against Dennis Bailey and the businesses he owns: Bailey’s Superstore, Inc., Bailey’s BottleShoppe, Brooks Bailey Enterprises, Inc., Bailey’s on Main, Bailey’s Pawn and Gun, and Newsmart Liquor.

Arkansas Attorney General filed a lawsuit against Bailey and his businesses under the Arkansas Deceptive Trade Practices Act for his illegal use of the criminal court system to collect debts.

The lawsuit requires that Bailey pay $50,000 in restitution, $250,000 in suspended civil penalties, and withdraw all affidavits that were submitted previously to the Hot Check Coordinator that was valued at $125,000.

“Bailey abused the criminal court system to take advantage of vulnerable Arkansans who needed money to pay their bills or for emergencies—some even paying for a family member’s funeral,” said Attorney General Rutledge. “Anyone who has experienced these illegal business practices should call my office to let us do the fighting for you.”

The complaint that was filed in July of 2019 showed that Bailey often loaned large amounts of money to his customers. For the security of the loans, Bailey would accept signed blank checks. When the debt would be past due, customers could buy the blank check back for the cost of the original loan, plus interest, which violates the Arkansas Constitution’s 17% usury cap.

If the customer was unable to pay the debt on time, Bailey would add the principal and interest together, enter it as the amount to be paid on the check, and deposit it into one of his business bank accounts. If the check returned unpaid by the bank, Bailey would turn those checks over to the prosecuting attorney’s office for enforcement under Arkansas’s Hot Check Law. Customers who did not repay Bailey’s loans on time would be arrested, jailed, and convicted of crimes they never committed.

Due to this judgment, Bailey and his businesses are now restrained permanently and ordered from offering usurious loans, the deferred deposit of checks for usurious fees, or changing usurious check-cashing fees. He is also ordered from holding any check, debit or credit card, driver’s license or identification, or EBT card as a promissory note or security for the payment of any money, loan, or debt.

Bailey and his businesses have been barred from entering any transaction to any prosecuting attorney’s office for collection or law enforcement action that violates Arkansas Law. The lawsuit bars Bailey from retaliating against any person who reports that their debt to Bailey was wrongfully submitted to law enforcement for collection or who provided information or cooperated with the state in its investigation and prosecution of the case and from threatening customers with taking any action. Anyone employed by or affiliated with Bailey can violate these provisions.  

Bailey is told he must cooperate and assist the state to resolve all of the wrongful arrests or convictions of customers who were affected, reinstatement of victims’ wrongfully-suspended licenses, refunds of fees and fines, and expungement of any criminal records.

Those who have been affected by Bailey or similar business practices are asked to contact the Attorney General’s office to file a consumer complaint. You can call (800) 482-8982 or go to ArkansasAG.gov.

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