Legal Issues and Fraud and Investing and Banking & Finance and Tim Durham and Law

Judge nearly sends Durham back to halfway house

August 19, 2011

Indicted financier Tim Durham's request to move back into his 20,000-square-foot Geist mansion isn't sitting well with Magistrate Judge Kennard Foster, who at a Friday afternoon hearing nearly ordered him to live instead in downtown Indianapolis halfway house.

Durham has been living on home detention at his sister's house since shortly after his April arrest on 12 felony counts stemming from the collapse of Fair Finance Co., the Akron, Ohio, firm he's accused of looting.

In a sealed motion, he recently asked for permission to move back into his mansion. According to an objection filed by federal prosecutors, Durham made the request because his sister was concerned for her safety because of threats made against Durham.

Durham's attorney, John Tompkins, said at Friday's hearing that the FBI had checked out the threats that led to Durham's motion and found them not to be serious. As a result, Tompkins suggested that Durham either continue living with his sister, move to the mansion or work with the Probation Department to identify a mutually agreeable third option.

But Foster noted that both his sister's house and his mansion were in foreclosure and that alone "is a good reason for Mr. Durham not to be there." He said the Volunteers of America halfway house where he lived for five days after his arrest would provide an environment that protected Durham's safety.

"I don't want him at the current location. So in the interim he's going to be at VOA," Foster said.

Tompkins pursuaded Foster to give him 72 hours to work with the Probation Department on a new place for Durham to live. Under Foster's order, if Durham and the Probation Department haven't come up with a location when the 72 hours expire, Durham will live at the VOA.

Prosecutors also had objected to allowing Durham to live in his mansion. In a court filing, they argued that allowing Durham to live in a house built partly with Fair Finance Co. investor money is “tantamount to letting him enjoy the fruits of his crime, as alleged by the grand jury.”

A 23-page grand jury indictment alleges Durham and business partner James F. Cochran worked with former Fair Finance Chief Financial Officer Rick D. Snow to devise and execute a scheme to defraud Fair's investors.

Authorities say that after Durham bought Fair in 2002, he doled out related-party loans with abandon, leaving the company unable to repay Ohio residents who purchased unsecured investment certificates boasting interest rates as high as 9.5 percent. More than 5,200 investors are owed more than $230 million.

Durham, Cochran and Snow have denied wrongdoing.

Durham attending Friday's hearing but did not speak publicly.

Last month, Judge Jane Magnus-Stinson denied Durham’s request to relax restrictions of his home detention. He had asked the court to modify the conditions of his release to visit his attorney’s office more frequently and to travel to California up to 12 days a month.

Durham is acting CEO of National Lampoon Inc. in Los Angeles.

More of IBJ's coverage of Durham and Fair Finance can be found here.

ADVERTISEMENT

Recent Articles by Greg Andrews

Comments powered by Disqus