IBJNews

Fair trustee sues to recoup $138,580 in GOP donations

Back to TopCommentsE-mailPrintBookmark and Share

Fair Finance Co.’s bankruptcy trustee this week filed five lawsuits seeking a total of $138,580 from recipients of political donations from accused Ponzi schemer Tim Durham.

Trustee Brian Bash is seeking the largest sum—$50,000—from the Greater Indianapolis Republican Finance Committee. In all the cases, Bash argues that Fair is entitled to recover the money because at the time Durham made the donations he owed millions of dollars to Fair and its parent companies.

The suits seek donations made since 2006. By the end of 2005, at the latest, Fair operated as a Ponzi scheme and was insolvent by more than $50 million, each of the lawsuits say.

“Durham made the payment to defendant with actual intent to hinder, delay or defraud Fair Finance and its parent companies,” according to the suits.

The other suits seek $40,000 from the committee for Lawrence Mayor Paul Ricketts, $33,580 from the House Republican Campaign Committee, $10,000 from the committee for Speaker of the House Brian Bosma and $5,000 from the Marion County Republican Central Committee.

Before his financial empire collapsed in 2009, Durham was a huge funder of Republican political candidates. The trustee hasn’t filed suits against the biggest recipients of Durham’s political largesse—campaign committees associated with Indiana Gov. Mitch Daniels and former Marion County Prosecutor Carl Brizzi. Both candidates received about $200,000 from Durham.

In an email Friday afternoon, Brizzi suggested a settlement might be in the offing. "We are working with the trustee toward a mutually agreeable resolution," he said.

Bash said in a statement last month that Daniels at least had responded to the trustee’s request that he return campaign contributions, unlike most others, and the trustee hoped “for mutual resolution through continued discussions.”

A spokeswoman for Daniels did not respond to a request for comment Friday. Joe Esmont, an attorney for the trustee, declined to comment. Representatives of the committees named in this week's suits were not immediately available.

For more than a year, Bash has been trying to recover money for Fair investors—Ohio residents who purchased unsecured investment certificates with interest rates as high as 9.5 percent. He alleges Durham “utterly looted” 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.

In the statement, he praised Indiana Sen. Mike Delph for “doing the right thing” and returning $10,000 and implored fellow elected officials to follow suit. At least one other Republican has returned Durham money. Former Marion County sheriff candidate Tim Motsinger in late 2009 returned all contributions and loans from Durham, his campaign finance manager, and withdrew from the race.

Last month, Marion County Republican Party Chairman Kyle Walker expressed sympathy for victims of Fair Finance’s collapse but said Durham’s contributions to the party have “long since been spent in good faith.”

Most of Durham's political contributions went to Republicans, but former Indianapolis Mayor Bart Peterson collected $2,000, and former U.S. Rep. Baron Hill received $5,000. Adam Kisch, spokesman for the Marion County Democratic Party, said he did not know whether the men, both Democrats, had returned the contributions.

Durham and two business partners, James Cochran and Rick Snow, were arrested March 16 after being indicted on 12 felony counts, including conspiracy to commit wire and securities fraud.

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

 

ADVERTISEMENT

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:
 
thisissue1-092914.jpg 092914

Subscribe to IBJ
  1. Cramer agrees...says don't buy it and sell it if you own it! Their "pay to play" cost is this issue. As long as they charge customers, they never will attain the critical mass needed to be a successful on company...Jim Cramer quote.

  2. My responses to some of the comments would include the following: 1. Our offer which included the forgiveness of debt (this is an immediate forgiveness and is not "spread over many years")represents debt that due to a reduction of interest rates in the economy arguably represents consideration together with the cash component of our offer that exceeds the $2.1 million apparently offered by another party. 2. The previous $2.1 million cash offer that was turned down by the CRC would have netted the CRC substantially less than $2.1 million. As a result even in hindsight the CRC was wise in turning down that offer. 3. With regard to "concerned Carmelite's" discussion of the previous financing Pedcor gave up $16.5 million in City debt in addition to the conveyance of the garage (appraised at $13 million)in exchange for the $22.5 million cash and debt obligations. The local media never discussed the $16.5 million in debt that we gave up which would show that we gave $29.5 million in value for the $23.5 million. 4.Pedcor would have been much happier if Brian was still operating his Deli and only made this offer as we believe that we can redevelop the building into something that will be better for the City and City Center where both Pedcor the citizens of Carmel have a large investment. Bruce Cordingley, President, Pedcor

  3. I've been looking for news on Corner Bakery, too, but there doesn't seem to be any info out there. I prefer them over Panera and Paradise so can't wait to see where they'll be!

  4. WGN actually is two channels: 1. WGN Chicago, seen only in Chicago (and parts of Canada) - this station is one of the flagship CW affiliates. 2. WGN America - a nationwide cable channel that doesn't carry any CW programming, and doesn't have local affiliates. (In addition, as WGN is owned by Tribune, just like WTTV, WTTK, and WXIN, I can't imagine they would do anything to help WISH.) In Indianapolis, CW programming is already seen on WTTV 4 and WTTK 29, and when CBS takes over those stations' main channels, the CW will move to a sub channel, such as 4.2 or 4.3 and 29.2 or 29.3. TBS is only a cable channel these days and does not affiliate with local stations. WISH could move the MyNetwork affiliation from WNDY 23 to WISH 8, but I am beginning to think they may prefer to put together their own lineup of syndicated programming instead. While much of it would be "reruns" from broadcast or cable, that's pretty much what the MyNetwork does these days anyway. So since WISH has the choice, they may want to customize their lineup by choosing programs that they feel will garner better ratings in this market.

  5. The Pedcor debt is from the CRC paying ~$23M for the Pedcor's parking garage at City Center that is apprased at $13M. Why did we pay over the top money for a private businesses parking? What did we get out of it? Pedcor got free parking for their apartment and business tenants. Pedcor now gets another building for free that taxpayers have ~$3M tied up in. This is NOT a win win for taxpayers. It is just a win for Pedcor who contributes heavily to the Friends of Jim Brainard. The campaign reports are on the Hamilton County website. http://www2.hamiltoncounty.in.gov/publicdocs/Campaign%20Finance%20Images/defaultfiles.asp?ARG1=Campaign Finance Images&ARG2=/Brainard, Jim

ADVERTISEMENT