Durham drops loan program suit

The city decides that a criminal case against the woman who ran it is enough

Staff WriterFebruary 16, 2008 

— City officials have decided to drop a lawsuit against the woman accused of masterminding a scheme to bilk thousands of dollars from a now-defunct loan program.

Anita Fenner Bennett, who won a bid in 1999 to run a small-business loan program for Durham, was sentenced to prison in October for guilty pleas to 20 counts of obtaining property by false pretense.

City Manager Patrick Baker said Friday that with Bennett in prison and $180,000 in restitution to the city ordered, the civil lawsuit was no longer necessary.

"Basically all the money we can get from her, we're required to get," Baker said. "We also feel that justice has been served."

The criminal sentence stems from March 2006, when Durham police investigators charged Bennett, her husband, James Leroy Bennett, and her sister, Kathy Fenner, with conspiring to wring $828,000 from the program by issuing loans to businesses that were either nonexistent or not eligible for the money.

Charges were dismissed against James Bennett.

But Anita Bennett and Fenner entered guilty pleas. Fenner is to pay $42,000 back to the city.

Bennett ran the loan company through her nonprofit company, Triangle Economic Development Corp., for two years before officials discovered that no payments had been received from the 24 businesses that got loans. A closer look showed that some of the businesses cited did not exist.

Investigators said Bennett told people who came to her how to get loans, and then charged the recipients a fee that she had no authority to levy.

The city sued, Baker said, when it appeared that criminal charges might not be brought against Bennett.

Federal investigators had been looking into the matter in 2001 before the Sept. 11 attacks that year shifted their focus to other matters.

The city, uncertain that any criminal charges would ever be levied, pursued the matter in civil court as a way to get the money back.

"We as a city pursued the civil case because we could not let this matter go unanswered," Sherri Zann Rosenthal, senior assistant city attorney, said in a statement. "With the felony convictions, prison sentence for Bennett and appropriate restitution to the city ordered by the court, we advised City Council that there is now nothing more to be gained from civil litigation in the matter. They agreed."

anne.blythe@newsobserver.com or (919) 932-8741

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