In this March/April of 2019 issue of Community Banker we discuss an important court ruling out of South Dakota.
The 8th Circuit Court of Appeals recently affirmed a ruling against South Dakota lender First State Bank of Roscoe and its president, John Beyers, who was accused of manipulating the borrowers into repaying debt that had been discharged in bankruptcy. In 2016, Pres. Beyers was found to be in contempt of a final bankruptcy court injunction, based on findings in a parallel state court proceeding. The contempt motion was granted in June 2016, ordering $159,606.77 in compensatory damages and another $50,000 in punitive damages. Half the punitive damages were owed by the bank, half by Pres. Beyers. In that this has worked its way up to the 8th Circuit in nearly three years, the interest on these awards is substantial; much worse, the damage to the good name of the Bank is immense.
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