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Home > Blogs > Butler County News and Issues > Archives > 2009 > August > 05 > Entry
Bank exec: Money from Dynus deal ‘appears to have evaporated’
Federal court testimony Wednesday, Aug. 4, described how a couple of people were able to borrow millions of dollars from one of the country’s largest banks based on false promises and phony deals.
Prosecutors in the trial of former Dynus Corp. owner Orlando Carter asked National City Bank executive Ralph Martinez what happened to the $6.5 million the bank loaned Dynus in 2004 and 2005 for a deal with Butler County that didn’t exist.
“We don’t know,” Martinez said. “It appears to have evaporated.”
Martinez works for the business financing arm of National City Bank — which he described as the fifth largest financing company in America with deals totaling $9 billion.
Late last year, National City was purchased by PNC with help from the federal government’s bank bailout
Bank officials testified that they were threatened by Dynus president Jim Smith and then-Butler County auditor Kay Rogers in 2004 that they had far-reaching political connections and would jeopardize the bank’s business with other governments if they didn’t give a $5.2 million loan.
Smith told the bank he was an agent of the county and needed to borrow the money on the county’s behalf. This was the second loan he took out in the county’s name, the first was for $2.5 million.
The bank was retiscent, but Smith turned up the pressure, working late into the afternoon New Years eve to pressure the bank to unhand the money. He had Rogers — who Smith testified he had given a bribe — assure the bank the deal was sound, Smith and bank officials said.
“We really didn’t want a reputational risk,” said Vincent Rinaldi, CEO of the bank’s financing arm.
So the bank agreed to loan the company $4 million on the condition that it either provide a letter from the county prosecutor affirming the deal, or give back the money.
Carter’s defense team stressed that it was Smith, not Carter, who made the deal with the bank and that the bank did not try to contact Carter before the deal was struck.
Carter is fighting an 11-count indictment, including charges of bank fraud. Carter is alleged to have misrepresented his income to secure a $1.2 million home and misled banks about business deals with Butler County. He’s also accused of lying on a bankruptcy petition.
Permalink | Comments (3) | Post your comment | Categories: Dynus
Comments
By Average Joe
August 5, 2009 11:44 AM | Link to this
I want to know what Kay Rogers and the rest of them are sentenced to. I hope they get the max and whatever it takes to get the money back, even if it means giving up their properties and all assets
By kays nightmare
August 5, 2009 1:27 PM | Link to this
Kay Rogers authority didn’t go beyond being a home town bar fly. So who were the bigger fish she and others referred to when making their threats to bank managers ?? Kay knows her sentencing is being delayed based on what she revels in testimony.
By pw
August 6, 2009 8:07 AM | Link to this
Funny how money just seems to evaporate. This is just the tip of the iceburg. More to come.