Fayetteville ad firm's founder hit with second lawsuit
Smith Advertising & Associates' founder, Gary Smith, has been named in a second lawsuit that claims financial fraud. The agency closed unexpectedly last week.Posted — Updated
RMF Partners, a Florida company that helped finance Smith Advertising & Associates, claims Gary Smith defrauded it out of $17.6 million. RMF accuses Smith of falsifying invoices to make it appear that his business had more revenue coming in than it did, therefore allowing Smith to get more money from RMF.
Since 1974, Smith Advertising had worked on accounts for banks, mortgage companies and tourism bureaus in Fayetteville, Ocean Isle Beach and Sarasota, Fla.
Last week, Secret Service agents took dozens of files and computer drives from the company's Fayetteville office, which clients say closed suddenly.
It also closed an office last week in Sarasota.
Those closures came on the heels of a $10 million lawsuit by Regions Bank in Florida, which claims that Smith and a developer engaged in an illegal check-kiting scheme in which it transferred money between different bank accounts, leaving at least one without enough money to cover financial obligations.
Neither Smith nor his son, Todd Smith, the advertising company's vice president who is also named in the lawsuit, could be reached for comment Friday. Phone numbers for both are no longer in service.
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