Judge sets trial date for Barber’s attorney
FORT SMITH — A federal court judge set Dec. 14 for the start of the second trial of Fayetteville attorney K. Vaughn Knight on charges related to Northwest Arkansas developer Brandon Barber’s financial collapse.
U.S. District Judge P.K. Holmes III scheduled the trial in Fort Smith this week, a month after the 8th U.S. Circuit Court of Appeals upheld a June 2014 ruling throwing out Knight’s convictions and ordering the retrial.
In the first trial, the jury heard testimony and argument from Nov. 4-15, 2013, then returned after six hours of deliberation to convict Knight on all eight counts in the government’s indictment.
On a motion from Knight’s attorney, Holmes threw out Knight’s convictions for conspiracy to commit bankruptcy fraud, aiding and abetting bankruptcy fraud, and five counts of money laundering. Holmes also acquitted Knight of making false statements in relation to Barber’s bankruptcy case.
The government appealed to the 8th Circuit.
In a Sept. 28 decision, the 8th Circuit affirmed Holmes’ ruling but reversed his acquittal on the false statements charge, ordering that he be retried on that charge.
The government tried Knight on the five money laundering counts, accusing him of using his lawyer’s trust account to help Barber hide $1.2 million from his creditors so he could use the money for his own purposes.
The government also accused Knight of misrepresenting Barber’s financial condition to the U.S. bankruptcy court by omitting income from one or more business entities that Barber used for his own benefit.
The majority opinion from the 8th Circuit agreed with Holmes that the government’s evidence “largely invited only speculation and conjecture” with gaps that left in doubt the correctness of the jury’s verdict.
Given the six hours the jury deliberated on the evidence, the judges agreed with Holmes that it did not adequately weigh the “dense factual and legal issues in the case and instead convicted Knight because he was Barber’s lawyer.”
Knight is the last of six defendants in two federal court cases brought in 2013 involving Barber and his financial meltdown.
Barber pleaded guilty to money laundering and conspiracy to commit bankruptcy fraud in the case involving Knight and New York businessman James Van Doren.
Barber was sentenced Oct. 28, 2014, to 65 months in prison and ordered to pay $450,000 restitution.
In the second case, Barber pleaded guilty to bank fraud involving kickbacks in a bank loan scheme. His 65-month sentence runs concurrently with his bankruptcy fraud conviction.
Van Doren pleaded guilty in August 2013 to one count of money laundering and was sentenced to 15 months in prison.
Two defendants in the bank fraud case, Jeff Whorton of Springdale and Brandon Rains of Fayetteville, pleaded guilty in federal court. Whorton pleaded guilty to money laundering and conspiracy to commit bank fraud, for which he was sentenced to 14 months of home detention, fined $10,000 and ordered to pay $100,000 restitution. Rains pleaded guilty to lying to federal agents and was fined $5,000.
The fourth defendant in the bank fraud case, Rogers attorney David Fisher, had a federal court trial in October 2013 and was acquitted of conspiracy to commit bank fraud.