Citing millions of dollars in fraudulent "bad checks" deposited the two days before the implosion of the Reagor-Dykes Auto Group, Vista Bank urged a federal bankruptcy judge to allow the government to liquidate the auto group and salvage value for the creditors' benefit.
Vista Bank filed a motion to convert and joined it with the U.S. Trustee's motion to convert the Reagor-Dykes case from Chapter 11 "restructuring" to Chapter 7 "liquidation." The U.S. Trustee -- a representative of the Department of Justice -- filed its conversion motion in December, while FirstCapital Bank filed a similar motionlast week.
In a status hearing on January 22, Vista attorneys claim the auto group's estate and its "plan sponsor" admitted "what the court knew more than a year ago -- that there was no reasonable probability of a successful reorganization." FirstCapital Bank claimed last week the plan sponsor -- an investment group led by oil-and-gas company Henry Resources, LLC -- backed out of its role of chief investor, removing the first $13 million investment into the plan to rebuild a new car business.
On July 30 and 31, 2018, Vista claimed in its motion the auto group deposited millions of dollars in bad checks, then immediately wrote more checks to other banks to cover payments on that provisional credit; then, while Vista worked to get the money to cover those checks, the payor banks returned those checks as unpaid, leaving Vista unable to collect on the false deposits. Vista claims that left Reagor-Dykes "grossly overdrawn and owing Vista millions of dollars for the funds they withdrew from the Accounts in provisional credit advances."
Ford Motor Credit filed suit against Reagor-Dykes on July 31, 2018, then the auto group filed for bankruptcy the next day.
Vista claims Reagor-Dykes' "scheme of serial deposits and float credit survived only as long as [it] maintained the volume and speed of its deposit cycle to keep ahead of the check clearing and cash letter process," but the bankruptcy interrupted that; on August 2, Vista received nonpayment alerts on the checks Reagor-Dykes had issued.
"With [Reagor-Dykes]' operations in shambles," Vista's attorneys write, "and the estates saddled with over $5 million in unpaid administrative expenses, it is time to proceed with liquidation."
A hearing is scheduled on the U.S. Trustee's and FirstCapital Bank's motions to convert for February 12.
DEC. 19:Reagor ordered to pay $26.5 million to IBC BankDEC. 1611th former Reagor-Dykes employee pleads guiltyDEC. 11:Another former Reagor-Dykes employee pleads guiltyDEC. 11:Hearing to confirm Reagor-Dykes plan pushed backDEC. 6:Reagor-Dykes attorneys answer Vista Bank's claims of extortionDEC. 6:Reagor-Dykes asks for hearing delay, claims creditors approving reorganizationDEC. 5:New guilty plea shows intricate details of Reagor-Dykes check-kitingDEC. 4:Vista: Reagor-Dykes attempting to 'extort' bankDEC. 2:Bart Reagor ordered to pay nearly $1.8 million to Vista BankNOV. 26:Judge adds attorney fees to total payment in Ford Credit v. Bart ReagorNOV. 7:Additional creditors object to Reagor-Dykes reorganization planNOV. 6:Two creditors object to Reagor-Dykes reorganization planNOV. 4:Eighth former Reagor-Dykes employee pleads guiltyNOV. 4:Vista Bank, FirstCapital Bank resolve lawsuitOCT. 29:Dykes, First Bank & Trust settleOCT. 28:Two more former Reagor-Dykes employees plead guiltyOCT. 16:Judge to rule in Vista Bank's favor against ReagorOCT. 11:Hearing set on motion to convert Reagor-Dykes cases to Chapter 7OCT. 10:Ford Credit takes issue with First Bank & Trust's liquidation requestOCT. 7:Now up to five: Two more former Reagor-Dykes employees plead guiltyOCT. 4:Reagor-Dykes counsel asks to delay liquidation requestOCT. 4:First B&T: Reagor, Dykes using hearsay, speculationOCT. 4:Judge denies Reagor's request to delay Vista Bank suitOCT. 3:Jury orders Reagor to pay $53.7 millionOCT. 3:Vista Bank: Reagor unnecessarily delayingOCT. 3:Judge issues gag order against Reagor, representativesOCT. 2:Day 1: Ford Credit claims Bart Reagor owes $54 millionOCT. 1:Countersuit: Vista Bank wrongfully used Reagor's accountsSEPT. 26:Reagor-Dykes reorganization proposal goes to a voteSEPT. 20:More charges: Two Reagor-Dykes employees plead to bank fraudSEPT. 12:First Bank & Trust proposes converting Reagor-Dykes bankruptcy to liquidationSEPT. 3:Reagor-Dykes names primary investor in re-organization planAUG. 29:Objections remain in Reagor-Dykes' path to reorganizationAUG. 5:Trial date set in Ford Credit vs. Bart ReagorJULY 12:International Bank of Commerce sues Ford Credit, claims damages tied to Reagor-Dykes collapseJULY 11:Hearing on what Ford Credit claims Bart Reagor owes rescheduledJULY 6:IBC Bank moves for summary judgment vs. Reagor, judge recuses himselfJULY 1:Reagor-Dykes files reorganization planJUNE 24:Bart Reagor states he had no knowledge of fraud, check kitingJUNE 21:Judge approves bankruptcy plan schedule for Reagor-DykesJUNE 19:Former Reagor-Dykes CFO pleads to federal conspiracy chargeJUNE 18:July 11 hearing set on amount Reagor owes Ford CreditJUNE 17:Reagor: Ford Credit must show its work on how much it's owedJUNE 3:Ford Credit: Bart Reagor owes $46 million plus interestMAY 24:Ford Credit wins; court orders Reagor to payMAY 22:Progress reported in resolving Reagor-Dykes registration issuesMAY 9:Oklahoma bank sues Reagor, Dykes, offshore financial companies for $26 millionMAY 6:State of Texas sues Reagor, Dykes for more than $50,000 in sales taxesAPRIL 24:Reagor-Dykes registration issues may soon be resolvedAPRIL 16:Bart, Annette Reagor deny breaching insurance corporation contracts in $2.4 million suitAPRIL 10:Progress but no agreement, just yet, on Reagor-Dykes TT&L planAPRIL 8:Multiple objections filed to Reagor-Dykes' registration solution proposalAPRIL 2:Filing: Rick Dykes agrees to $58.7 million judgment to Ford CreditMARCH 23:Universal Underwriters sues Reagors, claims Auto Group defaulted on contractsMARCH 21:Vista Bank: FirstCapital Bank 'sealed the demise' of Reagor-Dykes with fraudulent agreementMARCH 20:700 Reagor-Dykes customers still have unresolved TT&L, trade-inMARCH 19:Proposal could resolve many Reagor-Dykes registration, title issuesMARCH 19:Landlord: Reagor-Dykes Plainview abandoned in 'extreme disrepair'FEB. 23:Dykes, Reagor response claims Ford Credit should have seen problemsFEB. 19:UPDATED: Reagor-Dykes mediation next week in DallasFEB. 15:Read order directing global mediation in Reagor-Dykes bankruptcyFEB. 14:Judge orders Ford Credit to participate in Reagor-Dykes 'global mediation'FEB. 11:Judge approves AmeriCredit's request for hearing on Reagor-Dykes SnyderFEB. 8:Judge orders TT&L lists turned over to creditor, others request infoFEB. 8:GM Financial, citing 'little opportunity' for meaningful progress, requests access to reliefFEB. 8:Judge denies Reagor-Dykes request to delay summary judgmentFEB. 7:Landlord orders Reagor-Dykes out, another phone hearing next weekFEB. 7:Ford Credit objects to Reagor-Dykes' attempt at 'global mediation'FEB. 6:First Bank & Trust opposes 'global mediation' for Reagor-DykesFEB. 6:Reagor-Dykes requests global mediation in bankruptcyFEB. 6:Reagor and Dykes argue if Ford Credit was complicit in fraud, two men not responsible for $109 million+JAN. 31:Reagor-Dykes seeks appeal of Bankruptcy Judge's orderJAN. 31:McDougal no longer involved in Reagor-Dykes re-organization effortJAN. 28:Nearly 6 months later, hundreds of Reagor-Dykes customers still in limboJAN. 23:FirstCapital Bank allows Reagor-Dykes to use cash collateralJAN. 18:Future uncertain for Reagor-Dykes Auto Group after recent rulingJAN. 17:Judge: Ford Credit may repossess Reagor-Dykes vehiclesJAN. 9:Court approves Reagor-Dykes interim fundingJAN. 8:Reagor-Dykes, Ford Credit argue future of Auto Group in bankruptcy courtJAN. 8:Citing possible criminal investigation, former Reagor-Dykes CFO requests stay on discoveryJAN. 8:Ford Credit: Reagor, Dykes signed guaranties, should pay $112 million+ in reliefJAN. 7:Reagor-Dykes files reorganization planJAN. 7:'Reagor-Dykes is not dead', Auto Group files response to Ford Credit's demandsJAN. 4:With no reorganization plan yet filed, Ford Credit seeks to take possession of Reagor-Dykes vehiclesJAN. 3:Lender asks bankruptcy court to force Reagor-Dykes legal team to produce documents2018DEC. 26:UPDATE: Court allows Ford Credit lawsuit to proceed against Bart Reagor, Rick DykesDEC. 12:Slow progress reported on Reagor-Dykes customers' TT&L, trade-insNOV. 29:McDougal, Ewing and Dykes lead group to purchase Reagor-Dykes assetsNOV. 21Former Reagor-Dykes CFO requests change of venue in lawsuitNOV. 20:Toyota, GM file objections in Reagor-Dykes bid processNOV. 14:State may extend titles for some Reagor-Dykes customersNOV. 2:Five more Reagor-Dykes entities petition for bankruptcyOCT. 29:Reagor-Dykes TT&L, trade-in issues remain unresolved; progress reported with some lendersOCT. 29:Bart Reagor, Reagor Auto Mall claim First Bank & Trust party at faultOCT. 29:Vista Bank asks to recoup funds in Reagor-Dykes accountsOCT. 18:No resolution yet on Reagor-Dykes customers' unpaid TT&L, trade-in liensOCT. 17:More lenders object to Reagor-Dykes' request for TT&L, trade-in paymentOCT. 16:U.S. Bank objects to Reagor-Dykes request for lenders to pay TT&L, trade-insOCT. 15:Compromise on vehicles in First Bank & Trust lawsuit v. Reagor Auto MallOCT. 15:Judge approves sale of Reagor-Dykes plane; Wells Fargo objects to portion of TT&L motionOCT. 12:Ford Credit supports part of Reagor-Dykes' request for lenders to pay TT&L, trade-insOCT. 12:FirstCapital files counterclaim, motion to dismissOCT. 10:Reagor-Dykes aircraft to be sold, pending court approvalOCT. 10:Several filings in Reagor-Dykes bankruptcy caseOCT. 1:KamKad, Reagor-Dykes execute purchase agreementSEPT. 24:FirstCapital Bank requests First Bank & Trust lawsuit against it, Reagor-Dykes, others move to federal courtSEPT. 21:Judge sets schedule, trial date in Vista Bank v FirstCapital Bank lawsuitSEPT. 21:Former Reagor-Dykes CFO denies late payments, says Vista Bank attacked him, his familySEPT. 20:Vista Bank sues former Reagor-Dykes CFO, claims loan defaultSEPT. 19:Texas DMV: Reagor-Dykes should promptly resolve title issuesSEPT. 19:Brad, Kenneth Burgess file motion to dismiss Vista Bank lawsuitSEPT. 18:First Capital Bank files motion to dismiss lawsuitSEPT. 18:Court approves bid process for Reagor-Dykes Auto Group, extends use of cash collateralSEPT. 17:Ford Credit, GM object to certain aspects of proposed Reagor-Dykes saleSEPT. 14:Judge sets trial date in Ford Credit lawsuit vs. Reagor-DykesSEPT. 14:Reagor denies Ford Credit's claim vehicles sold out of trustSEPT. 13:Dykes: Former Reagor-Dykes CFO admits he provided false info to Ford CreditSEPT. 11:Reagor-Dykes Auto Group requests court to allow sale of companySEPT. 4:Reagor-Dykes Auto Group establishes process to resolve customer problemsAUG. 31:International Bank of Commerce asks for court to allow it to foreclose on Reagor-Dykes dealershipsAUG. 31:More Reagor-Dykes companies, co-owners may soon file for chapter 11AUG. 30:Court extends Reagor-Dykes employment of CRO; officer discusses potential dealership buyersAUG. 29 :International Bank of Commerce asks for loan payment in Reagor-Dykes caseAUG. 29:Ford Credit objects to Reagor-Dykes earlier legal teamAUG. 27:Vista Bank doubles relief request in new federal suit against FirstCapital BankAUG. 25:Reagor-Dykes chief restructuring officer hires new legal teamAUG. 25:GM proceeding with termination of Reagor-Dykes FloydadaAUG. 23:Landlords demand rent for Reagor-Dykes dealerships in Lubbock, PlainviewAUG. 20:Ford Credit moves ahead with suit against Reagor, Dykes, some R-D companiesAUG. 18:Reagor-Dykes bankruptcy case: Read court order following Aug. 16 hearingAUG. 17:Auto dealer claims Reagor-Dykes owes $513,000, vehicles may be in consumers' possessionAUG. 16:Vista Bank sues FirstCapital for $6 million, claims Dykes helped perpetrate check kiting schemeAUG. 16:Bankruptcy court allows Reagor-Dykes continued use of cash collateral, hiring of CROAUG. 15:Reagor-Dykes Auto Group issues written apologyAUG. 14:Loss of Reagor-Dykes Chevrolet in Floydada a potential financial pitfall for cityAUG. 14:Vehicle auction company claims Reagor-Dykes owes it $687,000AUG. 14:Ford Credit claims Reagor-Dykes is not following court orders; court grants extension to file docsAUG. 13:U.S. Trustee opposes Reagor-Dykes request to hire chief restructuring officerAUG. 10:Ford Credit: Reagor-Dykes fraud may be among largest of its type in U.S. history; GM files to terminate Floydada dealershipAUG. 9:Reagor-Dykes questions former CFO’s actions; Contractor claims $700,000 due nowAUG. 7:Former Reagor-Dykes employees claim they were not paidAUG. 6:Customers concerned over Reagor-Dykes 'unwinding' processAUG. 6:Ford suit against Reagor-Dykes on hold while bankruptcy case proceedsAUG. 3:Judge approves Reagor-Dykes employee payAUG. 2:Mayor: Downtown Lubbock growth to remain strong regardless of Reagor-Dykes future