Fair Finance Co.’s bankruptcy trustee has filed a lawsuit against Tim Durham’s mother, alleging she received more than $831,000 in transfers from the financier in the four years before his financial empire collapsed in late 2009.
According to the lawsuit filed Friday in U.S. Bankruptcy Court for the Northern District of Ohio, Mitza Durham of Seymour received 58 checks or wire transfers from Durham from Feb. 28, 2006, through Nov. 17, 2009.
The lawsuit is among 25 that Fair bankruptcy Trustee Brian Bash filed late last week against individuals and businesses that he alleges collectively owe the bankruptcy estate more than $5.9 million.
Bash says the defendants either defaulted on loans or received transfers from Durham or his businesses. He contends the payments were fraudulent transfers that must be repaid because they were made when Durham and his companies were insolvent.
Other defendants in the barrage of suits include the criminal defense law firm Voyles Zahn Paul Hogan & Merriman, and the bankruptcy law firm Rubin & Levin. The suits seek to recover a $25,000 retainer Voyles Zahn received, and a $40,000 retainer to Rubin & Levin. Both were made in December 2009, weeks after the FBI raided Durham’s businesses.
Another target of the suits is Table Moose Media, which published Indy Men’s Magazine before it folded in 2007. The business, which was owned by Durham and former Eli Lilly and Co. Chairman Randall Tobias, owes $322,250, court papers allege.
Bash for nearly two years has been trying to recover money for Ohio investors who purchased unsecured investment certificates from Fair boasting interest rates as high as 9 percent. The Akron-based company stopped paying and never reopened following the FBI raid. About 5,300 investors are owed more than $200 million.
A grand jury in March indicted Durham and two business associates on charges of wire fraud, securities fraud and conspiracy to commit wire and securities fraud. Prosecutors allege that after buying Fair in 2002, Durham raided its coffers to fund a lavish lifestyle as well as a host of money-losing businesses.
Durham and his co-defendants, Jim Cochran and Rick Snow, have denied wrongdoing.
Mitza Durham told WRTV-TV Channel 6 in 2010 that she believed her son's generous nature led to his financial problems.
"He's one of the most giving, kind people you will ever meet," she said. "That's where he got in trouble, I think. He helped too many people."
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