The suit, filed in Sharp County Circuit Court Civil Division June 18 names Wayne Watkins, Clifton Johnson, Howard Baswell, Virgil Griffin, Biggers Bluff Corporation and Spring River Beach Club Inc. as defendants.
"The facts of the case are complex, but an analysis of those facts will show that the defendants have engaged in a systematic, planned and coordinated scheme to defraud consumers," the document said.
Watkins, 59, founded the Spring River Beach Club in 1982, according to the suit. It was incorporated two years later. At that time he began selling plots of land, cabins, camper lots and memberships to his club.
Watkins also owns Riverbend RV Park, Sycamore Park and White Horse Mountain.
Johnson acts as manager of Riverbend Park. Griffin is Watkins' cousin and the current general manager of the club. Baswell has worked as manager of Sycamore Park and served as vice president of another of Watkins' companies.
The suit claims that Watkins and his associates defrauded consumers who were purchasers of plots of land typically under installment land sale contracts; however, in many cases, after the final payments were made the title was never delivered or fraudulent warranty deeds were dispersed.
"These were primarily regular working folks," Arkansas Deputy Attorney General Jim DePriest said, adding that most of the victims purchased spots to park their RV and camp.
With every land sale, the owner was also required to purchase a lifetime membership in the club. With this money the owners could enjoy the amenities of the club and help pay for the upkeep of Watkins' properties. The amenities included the use of tanning beds, miniature golf, swimming pools, horse and canoe rentals and payment of taxes on the owners' property, the suit said.
Sharp County filed charges against Watkins in February 2007 for his alleged fraudulent activity tied to his business ventures. The warrant for theft by deception, a class B felony, has never been served. Rather than facing the charge, Watkins friends say he instead fled to Mexico.
McDaniel said a few complaints began coming into the attorney general's office in the 1990s, long before he took office in January 2007. DePriest said it wasn't until the last few years, primarily the last two years, that more complaints began coming into the state office regarding Watkins.
DePriest said he thinks there are hundreds of people who have fallen victim to Watkins' scam. So far, the office has complaints from about 25 people.
In an interview last month, McDaniel said he expected it to be months before he actually filed a lawsuit against Watkins because he has not been located.
Chief Deputy David Huffmaster of the Sharp County Sheriff's Office said the office has had a number of local residents report seeing Watkins at local venues recently; however, when officers check out those reports the man they find is usually Baswell, not Watkins. The office had a report of a Watkins sighting as recently as June 19 but the driver of the SUV Watkins was allegedly driving was again Baswell.
"We've followed every tip and lead that we've got," Huffmaster said. "I'd love to know where that fine, young, Christian man is."
Regulations associated with the filing give 120 days from the time the suit is filed for the defendant to be served with papers. If papers are not served within that time the court can dismiss the case.
Despite the regulation, the suit was filed last week. McDaniel said Watkins violated the Deceptive Practices Act.
McDaniel is seeking an injunction, restitution to victims which has not yet been determined, civil penalties up to $10,000 for each violation of the act, enhanced civil penalties of up to $10,000 where violations were committed against elderly or disabled people, forfeiture of ties to do business in the state and attorneys fees and costs.
Despite the filing of the suit, victims aren't assured compensation.
"This is not a great case. It's a good set of facts but there is little likelihood of any recovery," McDaniel said in May. "We think he's squandered, wasted or spent all of the money overseas, or at least out of the country."
DePriest said many of Watkins' victims are from Arkansas but there are also some from other parts of the country. In fact, there may still be some victims who don't know they have been scammed.
If someone thinks they may have been victimized by Watkins they can contact the attorney general's office at 1-800-482-8982.
Representatives will then look into the cases individually. Victims are also encouraged to contact private counsel about the issue.