A Riverside man who’s become a prominent commercial real estate developer and restaurateur on Madison Street in Forest Park is being sued by a troubled Naperville bank for allegedly undermining the bank’s lending policies in order to reap larger profits for another financial firm in which he was also an investor.
Art Sundry, the developer behind Big Fin Properties, served as director of Wheatland Bank and was a member of its board of directors from February 2007 until he was unanimously removed from those positions in July 2009, according to Wheatland Bank’s complaint. Sundry’s titles with Wheatland Bank, which opened only three years ago in January 2007, put him in a position to evaluate loan applications. It is this role, according to the bank’s complaint, that Sundry abused.
Sundry declined to comment on the allegations when reached last week by phone.
In collusion with Michael Sykes, the former CEO of Wheatland Bank, and Edward Elsbury, a shareholder, Sundry is accused of approving risky loans to customers who were also doing business with Mezzanine Finance LLC. Mezzanine Finance was established in 2005 by Sundry, Sykes and Elsbury, according to the bank, for the purpose of providing commercial loans to developers. Sundry and his codefendants never disclosed to Wheatland Bank their involvement with Mezzanine Finance, creating a conflict of interest in approving loans from the bank to Mezzanine Finance customers, according to the suit.
“Sykes, Sundry and Elsbury personally profited from these loans as proceeds were used to pay off mezzanine loans placed by them against the properties through their separate finance company, MFL,” attorneys for the bank said in their Dec. 21 suit. “In addition, Sykes, Sundry and Elsbury … held MFL out to the bank’s customers as the bank, thereby causing actual confusion to bank customers about with whom they were dealing.”
Customers caught up in the alleged scheme were not identified in the complaint, and there is no specific reference to Sundry’s development firm, Big Fin Properties.
Through Big Fin Properties, Sundry owns a number of Madison Street storefronts. Sundry is also the proprietor of Caffe de Luca, which has locations in both Forest Park and Chicago.
Ten days after Wheatland Bank filed its complaint in Cook County Circuit Court, the Federal Deposit Insurance Corp. made public its request that the bank boost its capital levels over the next five months. According to a Chicago Tribune report, more than 30 percent of the bank’s loans are delinquent.