Creditors claim bankrupt Smith dumped $2M
LITTLE ROCK, Ark. – Creditors are trying to block former Arkansas football coach John L. Smith from liquidating $40.7 million in debt, saying he moved several properties and more than $2 million from his holdings prior to filing for Chapter 7 bankruptcy protection.
Federal bankruptcy court filings by Smith’s creditors say he cashed $1 million in certificates of deposit in 2008 and he is “unable to explain the current location of the funds.” The documents also allege that in 2008 and 2009, Smith transferred $1.16 million to his wife, son and daughter-in-law. Most of that sum, $975,000, went to the Diana Smith Trust, which is named for Smith’s wife.
Smith has said Kentucky real estate investments that went sour led his financial troubles. He disclosed to the Associated Press last summer that he expected to file for bankruptcy protection and hoped his financial woes wouldn’t be a distraction during the season as he took over for the fired Bobby Petrino.
The Razorbacks struggled under Smith, and he was let go after the season.
In 2008, Smith shifted ownership of real estate – two properties in Idaho and one in Michigan – to the trust in his wife’s name. The filings allege that Smith transferred his interest in a company, JLS Enterprises II LLC, to his wife’s trust in 2008 and between then and 2012, Smith signed documents as a “member” of JLH, which held property in Kentucky.
On Sept. 4, 2012, that entity was folded into Fourth and One LLC, of which Diana Smith was the sole member.
Smith filed for bankruptcy two days later.
Smith didn’t reply to an email requesting comment and a spokesman at Fort Lewis College in Durango, Colo., where Smith is now head coach, said Friday that Smith was out of town.
Smith was head coach at Idaho for six seasons beginning in 1989.