In 2017, when legendary Virginia banker Worth Carter died at age 79, West Virginia Gov. Jim Justice mourned the loss of a longtime, trusted financial partner and spoke at Carter’s funeral.
“We grew together,” Justice said. “I knew I could count on him, and always did.”
The chain of community banks that Worth Carter Founded, Martinsville-based Carter Bank & Trust, had been a key to the growth of Justice’s own business empire. Justice has described a relationship built on trust, inspiring deals that could be sealed with a handshake.
But that funeral marked a turn of events that sent Justice’s businesses deeper and deeper into perilous financial territory. The personal relationship is now a high-stakes and acrimonious parting of the ways.
Justice, whose status as West Virginia’s only billionaire was downgraded over the recent troubles, continues his role as the state’s governor. But in the background lurks financial drama that has drawn the attention of the business world.
On the line for the governor is a billion dollars in personal liability.
This month, Justice and his businesses sued Worth Carter’s old community bank chain, seeking to hold it accountable for $421 million in damages. Far from trust, Justice contends new leaders at the bank instituted more and more restrictions, tightening cash flow for the family businesses.
“Carter Bank is no longer a ‘lifetime financial partner,’ as it proclaims and as it had acted prior to Worth Carter’s death but a determined, self-proclaimed adversary,” wrote lawyers for multiple businesses owned by the governor and his family.
Justice acknowledges $368 million of outstanding loans with Carter Bank, millions in debt accompanied by the risk of personal guarantees.
That’s on top of a second, bigger financial crisis. When the relationship with Carter Bank started turning sour, the Justice companies partnered with a different financial suitor. That was Greensill Capital, an international financial services firm that went bankrupt this spring.
“We were just trying to pay Carter Bank off, and lo and behold it’s just almost the straw that broke the camel’s back,” Governor Justice said during a state news briefing this month.
Greensill packaged the loans and sold them to investment funds managed by the financial services company Credit Suisse.
Credit Suisse is now pressing to recover lost investments and has has named Justice’s Bluestone Resources as one of three major borrowers from the Greensill funds. That original loan amount was $850 million, and the current debt is $700 million.
Justice acknowledged personally guaranteeing those loans as well. He and his companies have a separate lawsuit against Greensill, contending they were snookered into taking on all that debt.
Together, the lawsuits are a financial nightmare that has developed from what once was rock-solid financial trust.
“You know, Worth Carter died a few years back. He was a great, great man…
Go to the news source: Justice’s debt, built on trust, is now a billion-dollar personal risk