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Home > Blogs > Butler County News and Issues > Archives > 2009 > August > 07 > Entry
Fifth Third Bank lost $4.3 million in Dynus scandal
A Fifth Third Bank official testified this morning on how his bank relied on purported business deals that didn’t exist to loan Dynus Corp. $13.8 million in 2004 and 2005.
Fifth Third employee David Hummel testified that Dynus owner Orlando Carter personally applied for the loans and lines of credit, including $5 million to purchase the company’s Bond Hill headquarters.
Carter also had help from prominent Cincinnati businessman Ross Love, who lost more than $1 million invested in Dynus.
Carter has pleaded not guilty to an 11-count indictment, including charges of bank fraud.
The Fifth Third loan applications signed by Carter included representations that the company had lucrative contracts with Butler County, West Chester Twp. Greensboro, Ala., and Robins Air Force Base in Georgia.
In fact, the company’s contracts with these agencies were pending at best. And former company president Jim Smith has testified that some of the contracts were actually based on forgery or fraud.
“We were led to believe it was a done deal,” Hummel said.
The application also did not include the fact that the company had borrowed $6.5 million from National City Bank in Butler County’s name without county approval.
The Fifth Third line of credit was for the operation of Dynus, and came with the stipulation that Carter not be paid more than $200,000, Hummel said.
He said he was unaware Carter had used $312,000 of the company’s money to purchase a $1.2 million mansion, spent $170,000 for a box seat on the 50-yard line of Paul Brown Stadium and Smith spent $1,366 of company money at a Hustler strip club in New Orleans.
“What happened to all these loans?” asked Assistant U.S. Attorney Richard Chema.
“We were not paid back,” Hummel replied.
“How much money has the bank lost,” Chema then asked.
“$4.3 million,” Hummel said.
The bank has a $5.6 million judgment against Carter that he is trying to have cleared through bankruptcy, Hummel said.
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