Durham Officials Still Looking For Answers In Loan Scandal
Posted January 5, 2006 8:49 a.m. EST
DURHAM, N.C. — Durham city leaders want someone to pay. Years after a loan scandal broke, police are tracking leads on hundreds of thousands of dollars of public money that investigators say was pocketed.
Search warrants obtained by WRAL outline allegations of fraud, forgery and fictitious loans. The investigation is focused on Durham's small business loan program and the woman who ran it.
Fenner/Bennett Search Warrants
Program director Anita Bennett was accused of mismanagement and fired, but has never been charged criminally. Durham Mayor Bill Bell and other city leaders recently directed Durham police to dig deeper.
"If you take public money for certain purposes, we expect you to spend it for that; and if you don't, we need to understand why," said Bell.
Investigators are analyzing Bennett's bank records, checking to see if Bennett issued bogus loans and had money funneled back to her. They're also looking at Bennett's sister, Kathy Fenner, and her bank records. They've found some suspicious transactions.
According to the search warrant affidavits, in 1999, Bennett approved a loan for A Basket Full of Cookies, a company run by Bennett's sister. The day after Fenner received a check for $33,000, there was a deposit for more than $15,000 into an account held jointly by the sisters.
Detectives said Fenner intentionally spelled her name wrong in loan papers. They also said Bennett's husband, James, knowingly notarized the inaccurate paperwork.
WRAL tried to talk with Bennett at her North Raleigh home Thursday afternoon, but her husband said she wasn't home and told us he wasn't aware of the investigation. James Bennett said he had done nothing wrong.
So far, investigators have executed seven search warrants. Many more are expected.
"What we'd like to do is make sure justice was done," said Bell. "Whether we get the money back or not, remains to be seen."
So far, only one loan has been paid back in full. The city's attorney said a handful of others are in the process of being paid off separate from the criminal case.
The city is suing Bennett in civil court. They're seeking close to $700,000 in damages. That case is set to go to court in July.