A Las Vegas community bank says it is trying to track down nearly $2 million that it supplied to an independent operator of automated teller machines.

From mid-1997 to late 1998, Business Bank of Nevada says, it provided cash to NMS Financial Inc., which NMS then used to fill its 110 ATMs in the Las Vegas area. Now, in a messy dispute that has sparked two lawsuits and a criminal investigation, Business Bank says NMS has failed to repay the money.

Business Bank says it has recovered about $300,000-thanks to a recent court order that permitted the district sheriff to seize any remaining cash at ATMs operated by NMS.

And chief executive officer Al Alvarez said he is confident that the bank will recoup the rest of the money through insurance and the pending lawsuit against NMS.

"We strongly believe we will recover the funds," said Mr. Alvarez. "There are many positive things happening and this should be a short-term matter."

The $110 million-asset bank said the dispute obliged it to restate its 1998 earnings.

Business Bank, which earlier this year reported earnings of $1.4 million for 1998, now says it lost $400,000 last year.

Mr. Alvarez and the bank's attorney declined to provide any more details relating to the suit, which was filed in Nevada's Clark County District Court in December.

NMS' owner, Errol Vestuto, could not be reached for comment, and his attorney did not return telephone calls. But Mr. Vestuto recently filed a countersuit against the bank and the Salt Lake City company that brokered the arrangement, Pinnacle Cash Systems, claiming defamation.

Business Bank said in its lawsuit that it supplied cash for ATMs operated by NMS through an agreement with Pinnacle, which arranges for financial institutions to supply cash to independent ATM operators such as NMS.

Business Bank, which made its money by charging a per-month fee based on the amount transferred to the individual machines, never had face-to-face contact with Mr. Vestuto, the bank says.

Under the agreement, Business Bank says, the money in the ATMs belonged to the bank until it was withdrawn by customers. Through the network processor, NMS was to repay the withdrawals to the bank on the next business day, according to court documents.

The bank says it first became suspicious when it discovered in December that four of the ATMs-which it had supplied with almost $111,000 since last spring-either did not exist or were not owned by NMS. Bank officials then discovered that NMS had fallen behind on reimbursements for withdrawals, the bank's lawsuit says.

Business Bank says it stopped supplying money to NMS in December. It is unclear whether any of the NMS-owned machines are operating.

In its lawsuit, the bank stated that Mr. Vestuto promised to repay the $111,000 in early December. To date, he has paid less than $10,000 of that amount, according to the suit.

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