OYSTER BAY - The Town of Oyster Bay may be on the hook for nearly $15 million after guaranteeing loans secured by indicted restaurateur Harendra Singh.

As News 12 reported last month, Standard & Poor's recently downgraded Oyster Bay's credit rating to junk bond status. Analysts say the new rating may have been due to the town guaranteeing $20 million in loans to Singh, whose businesses hold several concession contracts with Oyster Bay.

Singh's companies defaulted on their loans, and now the lender is coming after the town for a large portion of that money.

In three separate letters dated Feb. 26, representatives with the lending company wrote, "Phoenix Life hereby demands payment from the Town of Oyster Bay."

A spokesperson for the town says it is not responsible for repaying the loans, but Dean Hart, a former candidate for the Nassau County Legislature, disagrees.

"I don't know how you can invalidate it," Hart told News 12 Long Island. "We need an independent inspector or independent general to figure it out."

A town spokesperson told News 12 that Oyster Bay officials are currently in settlement negotiations with the lender and new investors. The goal is to avoid a lawsuit and "amicably resolve all issues."