John L. Smith reaches settlement in bankruptcy case
Former Arkansas coach John L. Smith has settled a complaint in federal bankruptcy court to the tune of $765,000 in cash and property.
The complicated life of former Arkansas coach John L. Smith has at least gotten a little less complicated with the news he has reached a settlement in his bankruptcy complaint.
Smith first filed for bankruptcy in the summer of 2012, but in February was accused of fraud in complaints filed in federal bankruptcy court, with creditors claiming Smith had concealed hundreds of thousands of dollars in assets in order to avoid paying his debts. The complaint also alleged that Smith arranged for his Arkansas contract to pay him thousands after he had filed his bankruptcy claim.
But according to a report this week from Arkansas Business, Smith has come to an agreement with bankruptcy trustee John Lee that will see Smith "return $165,000 in cash and $600,000 in property to settle the 'fraudulent transfer' claims."
Lee told Arkansas Business that Smith could have raised "potentially valid defenses" in court for the transfer of funds to his wife's revocable trust and children, and that the risk of coming away without any restitution was too great to risk turning down a settlement.
The current head coach of Division II Fort Lewis College in Durango, Colo., Smith eventually asked for relief of more than $40 million of debt in his bankruptcy filing. In court documents, Smith denied any "intent to defraud" with any financial transfers or the structure of his Arkansas contract.
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