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Home > Blogs > Butler County News and Issues > Archives > 2009 > August > 13 > Entry
Carter on illicit loans: ‘I did not know about it’
Update: Go here for the story on yesterday’s testimony that ran in today’s paper. It includes comments from readers.
Original post:
Former Dynus Corp. owner Orlando Carter again took the stand in his own defense in federal court this morning, Aug. 12, disputing testimony made by bank officials and former company employees.
Those people said Carter was involved in hiding the details of a loan with National City Bank that the company took out in Butler County’s name without county approval.
That is part of the 11-count indictment against Carter.
Carter said he knew National City was trying to get the county to sign an opinion of counsel letter to confirm a deal with the county. But he said he didn’t know company president Jim Smith was signing documents on behalf of the county and company to borrow money.
Throughout running the company, an outside audit required by Fifth Third Bank and even a meeting with National City Bank, Carter said he never became aware that his company was on the hook for $4 million.
“Dynus never was a part of the financing as it relates to National City and Butler County,” Carter said. “There was never a resolution that came to me. There was never any paperwork given to me by National City that said you’re financing a project for Butler County.”
“One of my employees made a commitment that he would help get an opinion of counsel, but the opinion of counsel was between National City and Butler County, not Dynus.”
The deal with Butler County involved letting the company use the county’s fiber optic ring in an economic development agreement. But county officials pulled out when they learned of the illicit loan.
The company collapsed in 2005 after Fifth Third pulled out a line of credit for the company that was based on the now-defunct deal. Fifth Third officials said they would not have extended the line of credit if they knew about the National City loan, and that Carter hid that information from them during an audit.
Defense attorney Wende Cross asked Carter if he told auditors that the company was on the hook for $4 million, and that National City was asking for the money back because the opinion of counsel never materialized.
Carter answered both questions the same way: “I did not know about it.”
Fallout from the company’s collapse spread to the upper branches of county government, with then-auditor Kay Rogers pleading guilty to bank fraud and later resigning for her role in the deal.
Smith also pleaded guilty to bank fraud, as well as another former Dynus employee.
Permalink | Comments (2) | Post your comment | Categories: Dynus
Comments
By AO
August 12, 2009 3:57 PM | Link to this
OH pulease… does Mr. Carter really believe the bs he is spouting? He is being insulting now. the perks must have gone to his head.
By jim
August 12, 2009 6:42 PM | Link to this
There ya go..another rat from the pack. There should be deeper investigation into the owners of Jags, there is at least one more partner that is now living abroad! and of course the rest of the commishners. Who will be next to not know anything?