IBJNews

Durham ordered to be held at halfway house for 7 days

Back to TopCommentsE-mailPrintBookmark and Share

A federal magistrate on Wednesday afternoon ordered indicted financier Tim Durham held at a halfway house for seven days until he can provide a better accounting of his finances.

Durham, 48, appeared in court in downtown Indianapolis for an initial hearing following his indictment and arrest March 16 on 12 felony counts, including conspiracy to commit wire and securities fraud.

He and two business partners, James Cochran and Rick Snow, are accused of defrauding about 5,000 investors in Akron, Ohio-based Fair Finance Co. of more than $200 million.

A federal magistrate in Los Angeles on March 21 ordered Durham, who lives in California, released on $1 million bond. The bond was posted by Joan and Beurt SerVaas, Durham’s ex-wife and her father. Durham has been held on home detention since his release.

But Magistrate Kennard P. Foster, unsatisfied with Durham’s financial disclosures, ordered him to a halfway house at 611 N. Capital Ave. operated by Volunteers of America of Indiana Inc.

“There’s a lot of money [involved],” Foster said. “Money means flight.”

One of Durham’s lawyers told the magistrate that financial disclosures have been made.

But Foster shot back: “What I saw was not sufficient.”

The lawyer later objected to the seven-day lockdown, but the magistrate promptly overruled the objection.

Foster set a time of 2 p.m. April 11 to re-evaluate Durham’s release from detention.

Durham, dressed in a dark-colored suit, barely spoke at the conference, only answering the magistrate when asked if he had read the indictment or had any questions.

A status conference to discuss issues of the case is set for 9:30 a.m. Thursday.

Durham and his two business partners are set to be tried May 16, though Assistant U.S. Attorney Winfield Ong admitted after Durham’s hearing that it’s “unlikely” a trial could be conducted that soon.

Each defendant faces a maximum of five years in prison for the conspiracy charge, 20 years in prison for each wire fraud count, and 20 years in prison for the securities fraud. In addition, each could be fined $250,000 for each count on which they are convicted.
    
Charges stem from a lengthy FBI investigation that made headlines in November 2009 when agents raided Obsidian’s offices in Indianapolis and Fair’s Akron headquarters.

Prosecutors worked for more than a year to piece together the complex case and present it to a grand jury.

Cochran and Snow were released on their own recognizance following a March 16 initial hearing in Indianapolis before Magistrate Foster.

Durham and Cochran bought the then-68-year-old business for $23 million in 2002, using almost entirely borrowed money.

They immediately began doling out related-party loans, adding to the debt load, while scaling back what had been Fair’s profit-making business—buying customer-finance contracts from fitness clubs, time-share developers and other firms that offered customers extended-payment plans.

Durham and Cochran allegedly sold off additional receivables over the years to pay off investors even as they used money from Fair Finance to pay for extravagances like a $250,000 garage remodeling project, a $150,000 gambling spree and $50,000 in country club dues.

Fair Finance was forced into involuntary Chapter 7 bankruptcy in early 2010.

More of IBJ's coverage of Tim Durham can be found here.


 

ADVERTISEMENT

  • Question--Bingham Hale
    th oldere guy in the pic is an attorney from Bingham Hale, Joe Hogsett's old firm--how is that not a conflict of interest?

    No wonder Tim is smiling. He gets all this attention knowing even if he is convicted it will be reversed based on conflict of interest?
  • Good Times
    Maybe Bales can sneak him out for one last bender with Brizzi.
  • Super job by the judge
    Tim is now going to have to reveal contents of accounts and corresponding account numbers--not just a "list" of purported assets like he had been duping the Ohio Department of Securities for the last ten years.

    If the judge is reading this please make sure you demand the last two year's worth of checking account records as well as all online activity AND his Apple Lap Macbook Pro computer that the feds "forgot" to retrieve when they arrested him. All his online accounts are stored on it--if you want to know where the money really is.

    He should also be required to show proof of funds for how he paid Roy Black, and how he has been paying his utilities, and $28k a month rent to 1650 Marlay owner/landlord Dan Fitzgerald of LA, that none of the feds could manage to interview. Sure would save a lot of time and expense.

    Again, great job to this judge for at least doing something.
  • WORSE THAN PRISON
    No question about the comments made regarding this VOA ½ way house; BTDT...Incompetent, ignorant, pointless, racist; there is no question that Tim has found his way to a place that is worse than prison and our local jail. The joint is run by buffoons! Though most of us that have experienced this place deserve it greatly, there are few that are worse than the mob that runs it. They hate work, responsibilities, whites and don't speak an intelligible language for that matter either so God only knows what they are saying when they do provide instruction or answers to questions. If the public wants to see Tim suffer, they can look no further.
  • Across the Street
    Ha! Maybe John Bales will visit him now, since Bales's office is ACROSS the street!
  • halfway house
    I don't know who got him in to that halfway house but they did him no favors. It is the most racist, unprofessional,mentally challenged place to be. So if some one thinks prison is rough they have never been to this VOA. I did alot of time and I would rather do 2 weeks in prison then to stay at the VOA for 7days. He is in hell now. LOL
    • picture this...
      I'm not supporting anyone here (heck, I'm a democrat), just wanted to present a little thought exercise. Say one of your loved ones was dying and someone you know gave you the money for an expensive, life-saving procedure that you could never have afforded on your own. That person is later convicted to stealing that money. You're still scraping by paying for health care costs and not able to afford much else. Would you compromise your loved one's continuing health to pay the money back, even though you never knew that the money was obtained fraudulently?

      I'm not saying it's the same situation, just trying to frame political donations in a slightly different light for the sake of thought and discussion.

      Welcome any replies.
      • re
        Why is a Federal Judge pussyfooting around with this Republican funding source, high value criminal who defrauding American People out of $200 Million? Why is the Judge not jailing him for Contempt of Court? Why is the Judge not demanding the Governor testify and show cause why he should not go to jail for refusing to return $275,000 squeezed from this "alleged" Criminal? The same question should be asked of former Prosecutor Brizzi (R) in testimony before this Judge.

        This is a Federal Case in the Southern District of Indiana, why is a Federal Judge not acting like he knows the Law, knows the accused's crimes, and the use of fraudulently garnered money to support Republican candidates and causes?

        There is something very fishy about this case.

        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. With Pence running the ship good luck with a new government building on the site. He does everything on the cheap except unnecessary roads line a new beltway( like we need that). Things like state of the art office buildings and light rail will never be seen as an asset to these types. They don't get that these are the things that help a city prosper.

        2. Does the $100,000,000,000 include salaries for members of Congress?

        3. "But that doesn't change how the piece plays to most of the people who will see it." If it stands out so little during the day as you seem to suggest maybe most of the people who actually see it will be those present when it is dark enough to experience its full effects.

        4. That's the mentality of most retail marketers. In this case Leo was asked to build the brand. HHG then had a bad sales quarter and rather than stay the course, now want to go back to the schlock that Zimmerman provides (at a considerable cut in price.) And while HHG salesmen are, by far, the pushiest salesmen I have ever experienced, I believe they are NOT paid on commission. But that doesn't mean they aren't trained to be aggressive.

        5. The reason HHG's sales team hits you from the moment you walk through the door is the same reason car salesmen do the same thing: Commission. HHG's folks are paid by commission they and need to hit sales targets or get cut, while BB does not. The sales figures are aggressive, so turnover rate is high. Electronics are the largest commission earners along with non-needed warranties, service plans etc, known in the industry as 'cheese'. The wholesale base price is listed on the cryptic price tag in the string of numbers near the bar code. Know how to decipher it and you get things at cost, with little to no commission to the sales persons. Whether or not this is fair, is more of a moral question than a financial one.

        ADVERTISEMENT