Former Little Rock attorney and real estate investor Gene Cauley’s financial troubles are in the news again.
This time a Pulaski County Circuit Court judge has appointed a receiver to operate Cauley’s companies under Coco Holdings I LLC, which owns and operates several outdoor billboard-advertising businesses in Arkansas.
First Tennessee Bank asked for the receiver after Coco Holdings and its subsidiaries defaulted on a $3.8 million loan they took out in October 2006, according to the bank’s lawsuit filed in Pulaski County Circuit Court.
Coco and the subsidiaries haven’t made the monthly payments since March 31. As of Aug. 10, the amount due on the loan was $3.39 million, which includes the nearly $33,000 in interest and late charges and other fees of $23,500.
Cauley, who is listed as manager for the companies in the loan documents, had personally guaranteed the loans, but the bank didn’t name him in the lawsuit. The bank, however, pointed out in the filings that it reserves its right to do so later.
The billboard companies told the bank that they didn’t have cash to operate, the lawsuit said.
The bank said that, without its consent, the billboard companies have “already transferred not less than six billboards and related assets” that were used for collateral on the loan. The bank added that the collateral probably isn’t enough to cover the loan amount.
On Aug. 28, Pulaski County Circuit Court Judge Marion Humphrey ordered that Coco Holdings couldn’t sell, transfer or do anything with the billboard’s property.
Also, Jac Belet of The Belet Group Inc. of Bolivar, Tenn., was appointed receiver. He will receive a $5,000 retainer fee and a fee of $150 an hour.
Another one of Cauley’s billboard businesses, Seco Outdoor Advertising Corp., wasn’t named as a defendant in the lawsuit. But it is also facing a judgment of about $3 million in connection with the electrocution of a Seco employee in 2005. Cauley is responsible for $575,000 of the judgment.
Cauley, of course, is waiting for his sentencing in federal court in New York for misappropriating $9.3 million worth of client funds. The sentencing is currently scheduled for Oct. 7, although we hear another continuance is possible.