IBJNews

Deca Financial to wind down after trustee opts for liquidation

Back to TopCommentsE-mailPrintBookmark and Share

Forced by creditors into involuntary Chapter 11 reorganization earlier this year, Deca Financial Services LLC instead is headed for oblivion.

On Monday, U.S. District Bankruptcy Judge Robyn Moberly approved a request by Deca’s bankruptcy trustee to terminate and wind down operations of the Fishers debt collection agency.

“The trustee has not been able to find substitute vendors willing or able to assist in the reorganization of the debtor,” trustee attorney John Hoard, of Rubin & Levin PC, said in an April 10 court filing. The filing said that as of Feb. 21, Deca owed key vendors $935,000.

Hoard could not be reached for comment Tuesday morning.

The U.S. Trustee’s office said Deca needs to retain about 11 employees to wind down operations over the next 60 days or so

It’s believed Deca had about 80 employees before a handful of creditors asked the court on Feb. 21 to place the company into involuntary Chapter 11.

It’s an astounding reversal for three-year-old Deca. Touted by economic development leaders as one of the state's most-promising young companies, the firm in 2012 was offered $2.5 million in conditional tax credits by the Indiana Economic Development Corp. Those credits would have kicked in had Deca created 270 jobs by 2015.

But Deca won’t hit that target. BMO Harris Bank, which previously made Deca a $3.3 million real estate loan and issued it a $7.5 million revolving line of credit, began freezing Deca’s accounts last year.

Deca claimed the freeze created havoc in its cash flow. In January, Deca successfully petitioned Hamilton Superior Court to compel the bank to unfreeze its accounts, at least for a time. But under questioning by attorneys for BMO, company insiders testified Deca was having trouble paying some clients before the account freeze.

Moreover, BMO cited concerns with Deca’s financial statements and that receivables were overvalued.

Deca co-founder Todd Wolfe said he’d been sidelined from the company for some time due to a fight with stomach cancer.  When he returned late last year, he dismissed a number of managers, including friend and executive David Hoeft.

Hoeft, who helped Deca procure the first phase of a U.S. Department of Education contract, testified that after he was temporarily named president of Deca he discovered that someone had moved $2 million from a company account.

For his part, Wolfe blamed what he said was a botched attempt by managers in his absence to refinance a mortgage loan on land the company uses.   

Fingerpointing ensued, and the final blow came when several customers petitioned the court in February to place the company into involuntary bankruptcy reorganization, alleging they were owed more than $362,000.

The court gave Wolfe a few weeks to come up with the money. Wolfe said he’d lined up a potential $11.5 million loan secured by real estate to inject capital into the company and pay creditors. But the deal for financing fell through at the last minute, and last month the court OK’d Chapter 11.

Deca was the second debt collection firm launched by Wolfe. In 1999, he started Indianapolis-based Premiere Credit North America. It was later acquired.

Much of Deca’s business was in collecting medical debt.

It’s not immediately clear how much the company has in potential assets that could be liquidated. Earlier this month, the court approved selling 31 of the company’s personal computers for $31,000.

Correction: An earlier version of this story incorrectly stated that David Hoeft was a co-founder of Deca Financial Services.




 

ADVERTISEMENT

  • DECA DOES DIRTY DEALS
    The only one paying the price are the people who worked there who are not getting paid for their collection efforts over the past couple of weeks
  • DECA DOES DIRTY DEALS
    My son worked for DECA until this past Friday after he was paid. On Monday they let all employees go with the exception of 11. Monies were being collected from innocent people who are now stuck in the middle. Though DECA was in Chapter 11, these workers had to keep calling and collecting money. A confirmation letter was to be mailed acknowledging their payments. None of the letters were mailed by DECA.So, people have paid DECA with no receipt of payment and now the medical entity which they owed is now sending someone else after them to collect the same debt which was just paid to DECA. My son found this to be a very unethical practice by both the company and the court appointed trustee. No I have a 25 year old Purdue graduate who may have to move home with his two dogs.
  • Karma...
    Good. They are scum anyway. Now they get to pay, lol!!!!!!!
    • Sad
      This is very sad news. This company was growing and had great potential. We need businesses to succeed in central Indiana. Just sad to read this today.

    Post a comment to this story

    COMMENTS POLICY
    We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
     
    You are legally responsible for what you post and your anonymity is not guaranteed.
     
    Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
     
    No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
     
    We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
     

    Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

    Sponsored by
    ADVERTISEMENT

    facebook - twitter on Facebook & Twitter

    Follow on TwitterFollow IBJ on Facebook:
    Follow on TwitterFollow IBJ's Tweets on these topics:
     
    Subscribe to IBJ
    1. Can your dog sign a marriage license or personally state that he wishes to join you in a legal union? If not then no, you cannot marry him. When you teach him to read, write, and speak a discernible language, then maybe you'll have a reasonable argument. Thanks for playing!

    2. Look no further than Mike Rowe, the former host of dirty jobs, who was also a classically trained singer.

    3. Current law states income taxes are paid to the county of residence not county of income source. The most likely scenario would be some alteration of the income tax distribution formula so money earned in Marion co. would go to Marion Co by residents of other counties would partially be distributed to Marion co. as opposed to now where the entirety is held by the resident's county.

    4. This is more same-old, same-old from a new generation of non-progressive 'progressives and fear mongers. One only needs to look at the economic havoc being experienced in California to understand the effect of drought on economies and people's lives. The same mindset in California turned a blind eye to the growth of population and water needs in California, defeating proposal after proposal to build reservoirs, improve water storage and delivery infrastructure...and the price now being paid for putting the demands of a raucous minority ahead of the needs of many. Some people never, never learn..

    5. I wonder if I can marry him too? Considering we are both males, wouldn't that be a same sex marriage as well? If they don't honor it, I'll scream discrimination just like all these people have....

    ADVERTISEMENT