The fraud and money laundering trials of former Northwest Arkansas developer Brandon Barber and his four co-defendants were reset Tuesday in federal court for later this year.
The trials of Barber, Jeff Whorton, Brandon Rains, K. Vaughn Knight and James Van Doren were scheduled to begin June 17, but were reset Tuesday by Judge P.K. Holmes.
Barber, Whorton and Rains are set for an Oct. 21 trial in Fort Smith, while Barber, Knight and Van Doren have a separate trial set for Sept. 16, according to federal court documents.
The defense team needs more time to prepare their case, Barber’s attorneys stated in court documents.
Barber, 37, was arrested in March in connection with a years-long investigation by federal agencies into fraud and money laundering allegations, whose potential maximum prison times could put Barber behind bars for the rest of his life.
Barber’s attorneys have until later this week to tell the federal court in Fayetteville why bank account transfers show apparent unauthorized transactions, including money that may have been borrowed from Barber’s fiancée Kristin Foodim, according to an order from magistrate Judge Erin Setser in Fayetteville federal court from last week.
Prosecutors, the FBI and the IRS allege that Barber declared bankruptcy in 2009 after racking up $200 million in loans, then hid assets from the courts and creditors during the bankruptcy process.
Setser filed paperwork May 23 requesting Barber account for transactions in his bank account for various restaurants and a wine bar, at a time when Barber is in home detention and must seek parole officer approval before traveling from his New York home, according to an order in U.S. District Court for the Western District of Arkansas.
As part of Barber’s home detention requirements, the fraud suspect also cannot accumulate debt or obtain personal loans from family or friends without prior court approval. Bank account documentation shows $13,000 moving into one of Barber’s accounts, as well as $600 being transferred from Foodim’s account into Barber’s, according to the judge’s order.
Barber’s accounts also show transactions for taxi and metro services within various areas in New York.
“The Court cannot help but question whether these expenditures evidence Defendant’s failure to comply with the conditions of his home detention,” Setser states in the order.
In response to Setser’s inquiries, Barber’s legal counsel told the federal judge they were not aware of the checkcard transactions in question. Setser responded in an order Tuesday, “The court is puzzled by this response…The defendant shall have until June 7 to provide the itemization (of the account) to the Court.”
Barber was released from jail May 13 after being locked up for almost a week while trying to find a permanent location to carry out his home detention. Barber is living at the New York home he shares with Foodim, where home detention conditions require he can only leave for medical necessities, court appearances and events that get prior court approval.
Barber was sent by the Fayetteville federal court to the Washington County Detention Center on May 7 after the judge found Barber did not have a permanent home in which to serve out his home detention restrictions. Barber’s permanent location for his home detention was later approved by the court as Foodim’s New York apartment she shares with Barber.
Foodim testified in court in Fayetteville in early May that she and Barber share an apartment in Manhattan and are paying $4,900 a month in rent. The monthly rent is expected to go up soon to $5,200. She said the two of them have “negative $100″ in a joint checking account, but added she receives $3,000 a month in child support from her former husband and a $500-a-day rate doing freelance marketing.
Barber was at the hearings in early May after being arrested in late April while on home detention in New York by FBI agents after failing to alert authorities 48 hours in advance about a business meeting, Hutchinson said.
The hearing was to determine if Barber’s bond would be revoked, since the unplanned meeting violated the terms of his release on bond. If the bond had been revoked, he would have been sent to a federal prison to await his trial date.
Barber last month had an unplanned brief meeting near his Manhattan residence with the chef at Erminia Ristorante Italiano to discuss business, court records show. Barber works on a commission-only basis for The Hotaling Group, a New York-based insurance firm whose website identifies it as having sports and entertainment clients.
Out on a previous $500,000 bond prior to being called back to federal court in Fayetteville in early May, Barber had been restricted to home detention except for work, family and religious functions, records show. He wore an ankle bracelet to monitor his whereabouts.
Barber pleaded not guilty April 15 to all fraud counts during a federal court hearing in Fayetteville.
Four others charged in the case also pleaded not guilty.
Less than a decade ago, Barber, then in his 20s, founded the Barber Group in Springdale and tackled several high-profile area projects such as the Legacy Building and the Bellafont condominiums in Fayetteville. He even proposed the 15-story Divinity Hotel in Fayetteville in 2006.
Court records show Barber took on massive debt, taking out millions of dollars in loans from local banks. Litigation from the financial institutions ensued, and years later, several court cases by banks and area entities against Barber remain unresolved, according to Washington County Circuit Court records.
In debt and collecting lawsuits, Barber filed for Chapter 7 bankruptcy in 2009, but is accused of hiding his assets from creditors. A year later, he was arrested on suspicion of driving while intoxicated for the second time in recent years, police records show. His development company also filed for bankruptcy, and he moved to New York.