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Fair Finance investors object to Brizzi settlement

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A group of Fair Finance Co. investors are objecting to a settlement the company’s bankruptcy trustee reached with former Marion County Prosecutor Carl Brizzi, arguing that the deal might extricate Brizzi from lawsuits they’ve filed against him.

Under the deal filed Nov. 21 in U.S. Bankruptcy Court in Akron, Ohio, Brizzi agreed to pay the trustee $195,881—by far the largest settlement with a politician who received campaign contributions from Fair Finance’s CEO, indicted Indianapolis financier Tim Durham.

But an attorney for the investors on Thursday filed an objection to the settlement, charging that Trustee Brian Bash’s proposed compromise with Brizzi, a former director of Fair Finance, could prevent them from “having their day in court.”

To recover their lost investments, the group has filed claims against Fair Finance and its affiliated entities, as well as various officers and directors, including Brizzi, for violations of Ohio securities laws.

The trustee since early 2010 has been trying to recover money for Fair Finance’s investors—Ohio residents who purchased unsecured certificates with interest rates as high as 9.5 percent. Bash alleges Durham “utterly looted” Akron-based Fair after buying it in 2002, stripping the business of the financial wherewithal to repay more than 5,000 investors who are owed more than $200 million.

The lawsuits the investors have filed against Brizzi are separate from the settlement agreement, a point their lawyer emphasizes in the objection in which the investors are referred to as the “Wayne County litigants.”

“The broad language in [Bash’s] proposed settlement agreement could be construed to release [Brizzi] from all claims, including the Wayne County litigants’ claims,” their lawyer wrote in the objection. “This would prevent the Wayne County litigants from having their day in court with respect to their claims against Brizzi for his role in the sale of the Fair Finance investment certificates and his role as a director of Fair Finance.”

The investors argue that Bash lacks the authority to release Brizzi from pending litigation and that doing so would be unfair because the proposed settlement does not require Brizzi to compensate any investors for his alleged liability as a director of Fair Finance.

Bash’s settlement with Brizzi calls for the Brizzi for Prosecutor Committee to repay all $170,881 donated by Durham, Fair Finance and affiliated companies.

In addition, Bash alleged that Fair Finance and Durham provided Brizzi with personal loans and financial assistance totaling $55,735 for trips and miscellaneous expenses. Brizzi disputed the amount, according to the settlement, but agreed to pay $25,000.

Brizzi didn’t seek re-election in 2010 following criticism over his ties to Durham, a friend who served as his 2006 campaign finance chairman. Brizzi now is in private law practice.

Durham and two business partners, James Cochran and Rick Snow, were arrested in March after being indicted on 12 felony counts, including conspiracy to commit wire and securities fraud. They deny wrongdoing.

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

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  • Who Is The Crook?
    Who is the Crook- or are they All Crooks?
    Wearing a Tie (or Not)- these guys all stink like a four-day old dead fish.
  • Shame
    Carl Brizzi is a thug, that's right "thug" the only difference is he wears a suit and tie. He and Charlie White should both be serving time with Plowman.

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  1. to mention the rest of Molly's experience- she served as Communications Director for the Indianapolis Department of Public Works and also did communications for the state. She's incredibly qualified for this role and has a real love for Indianapolis and Indiana. Best of luck to her!

  2. Shall we not demand the same scrutiny for law schools, med schools, heaven forbid, business schools, etc.? How many law school grads are servers? How many business start ups fail and how many business grads get low paying jobs because there are so few high paying positions available? Why does our legislature continue to demean public schools and give taxpayer dollars to charters and private schools, ($171 million last year), rather than investing in our community schools? We are on a course of disaster regarding our public school attitudes unless we change our thinking in a short time.

  3. I agree with the other reader's comment about the chunky tomato soup. I found myself wanting a breadstick to dip into it. It tasted more like a marinara sauce; I couldn't eat it as a soup. In general, I liked the place... but doubt that I'll frequent it once the novelty wears off.

  4. The Indiana toll road used to have some of the cleanest bathrooms you could find on the road. After the lease they went downhill quickly. While not the grossest you'll see, they hover a bit below average. Am not sure if this is indicative of the entire deal or merely a portion of it. But the goals of anyone taking over the lease will always be at odds. The fewer repairs they make, the more money they earn since they have a virtual monopoly on travel from Cleveland to Chicago. So they only comply to satisfy the rules. It's hard to hand public works over to private enterprise. The incentives are misaligned. In true competition, you'd have multiple roads, each build by different companies motivated to make theirs more attractive. Working to attract customers is very different than working to maximize profit on people who have no choice but to choose your road. Of course, we all know two roads would be even more ridiculous.

  5. The State is in a perfect position. The consortium overpaid for leasing the toll road. Good for the State. The money they paid is being used across the State to upgrade roads and bridges and employ people at at time most of the country is scrambling to fund basic repairs. Good for the State. Indiana taxpayers are no longer subsidizing the toll roads to the tune of millions a year as we had for the last 20 years because the legislature did not have the guts to raise tolls. Good for the State. If the consortium fails, they either find another operator, acceptable to the State, to buy them out or the road gets turned back over to the State and we keep the Billions. Good for the State. Pat Bauer is no longer the Majority or Minority Leader of the House. Good for the State. Anyway you look at this, the State received billions of dollars for an assett the taxpayers were subsidizing, the State does not have to pay to maintain the road for 70 years. I am having trouble seeing the downside.

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