Lawyer pleads guilty to $47 million Ponzi scheme

Breaking Legal News

An Arkansas lawyer and businessman admitted today to staging a Ponzi scheme that netted more than $47 million, a scam that a prosecutor called the largest case of fraud in state history.

Kevin Lewis, 43, pleaded guilty today to one count of bank fraud in federal district court in Little Rock. He could face up to 30 years in prison, though U.S. Attorney Christopher Thyer said Lewis would likely receive between 10 to 13 years.

He will also have to pay restitution of almost $40 million, though that number could go down further as banks work to recover their losses.

Lewis acknowledged that he issued paperwork for fake rural improvement bonds often used by developers to defraud several Arkansas banks starting with a small bond in 1997.

That money went to maintain his business interests across the state, which range from a law firm to a clothing company. He used the money to make the payments on past fake bonds and support a personal lifestyle that included a house valued at more than $1 million, fancy cars and vacations, Thyer said.

Meanwhile, the bank that bought almost $23 million of the fake bonds, First Southern Bank in Batesville, was placed into receivership by authorities, Thyer said. Lewis had purchased majority ownership of First Southern, using a loan from another Arkansas bank that was backed by the fake bonds.

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