IBJNews

Judge moves Durham fraud trial to next year

Back to TopCommentsE-mailPrintBookmark and Share

A federal judge in Indianapolis on Thursday morning set a new trial date for indicted financier Tim Durham while his lawyers again argued for his release from a halfway house that a magistrate sent him to on Wednesday.

Judge Jane Magnus-Stinson vacated the original trial date of May 16 and instead set jury selection for June 8, 2012, a Friday.

The trial for Durham and two business partners would start the following Monday and could last four weeks, federal prosecutors estimated.

Durham along with 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.

“The complexities of the case outweigh the public's and defendants’ interests in a speedy trial,” Magnus-Stinson said.

In the meantime, telephone conferences involving the judge, prosecutors and defense lawyers will be held every 60 days to monitor the status of the case.

A federal magistrate in Los Angeles on March 21 ordered Durham, who now 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 had been held on home detention since his release.

He appeared for an information hearing on Wednesday, where Magistrate Kennard P. Foster, dissatisfied with Durham’s financial disclosures, ordered him to a halfway house at 611 N. Capital Ave. operated by Volunteers of America of Indiana Inc.

Durham’s lawyers objected to the seven-day lockdown but were overruled by Foster.

The magistrate set a time of 2 p.m. April 11 to re-evaluate Durham’s release from detention. However, Durham’s lawyer Thursday morning asked Magnus-Stinson to vacate Foster’s detention order and requested his release.

Howard Srebnick, of Miami, cited a previous federal case to argue that only a judge, and not a magistrate, can alter release orders.

“It appears that Magistrate Judge Foster did not have the authority to make the order,” Srebnick told Magnus-Stinson. “We simply ask that Judge Foster’s order be vacated, and [Durham] be released to home detention.”

Srebnick further argued that Durham poses no flight risk. But during Wednesday’s hearing, Foster ordered Durham to the halfway house because he said there’s a lot of money involved, and “money means flight.”

Magnus-Stinson took the matter under advisement and could rule as soon as the end of the day Thursday.

The judge did grant a request by Srebnick to allow Durham to meet with lawyers at a downtown law office until 4 p.m. Thursday.

Lawyers for Cochran and Snow also attended Thursday’s status conference.

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 offices of Durham's business, Obsidian, in Indianapolis and Fair’s Akron headquarters.

Prosecutors worked for more than a year to piece together the 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 and Fair Finance can be found here.
 

ADVERTISEMENT

  • Hidden
    This is where durham was clever paying cash out to the likes of Brizzi, Daniel's and many others over the years, he is now recalling the favours. I bet if he was held on remand the trial would be brought forward,but if he can afford Roy black he will still have two or three million put away, this will be looked after by his most trusted people I hope they know when it's found they will also do jail time for contempt. Burt will also be pulling strings to get him out, hence the closed court, for once I thought we had a strong judge, it was the best thing he could do sending Harry potter to the half way house Durham will never disclose where the rest of the cash is hidden. and to the judge do not believe the assett report you are given on monday Durham had 70 + cars for a kick off only 37 have been taken and sold
  • Who paid $23M
    great question, especially when you review the two offerings of $60m dated 10/01 and 12/01...that's $120M in offerings to help Tim pay an allegedly inflated price of $23M for a business that in MY OPINION was maybe worth $8M....but hey, what do I know....Mr. Fair took a seller note and kept his mouth shut despite allegedly figuring out Tim was up to no good...

    so...the real question is will the BK trustee go back against Don Fair for the portion of the seller note paid during hte 4 years prior to the BK?
  • follow the money
    who loaned the 23 million;who owned the businesses they bought? were the businesses worth the selling price?
    • doesnt have enough money
      Fair Finance stole a lot of money and Durham spent a lot of it. Wall Street leadership stole 100x these amounts and are free to walk the street. Durham just didnt make enough to escape the classification of middle-management-level white collar criminal.
    • JUDGE WORKS FOR MONEY
      IF MONEY IS INVOLVED AND THE PRICE IS RIGHT A DEAL IS MADE (ALWAY'S FOLLOW THE MONEY) AND THE TRUTH WILL BE FOUND
    • Speaking of Voter Fraud...
      Anybody have Dick Lugar's home address? I want to put him on my Christmas card list.
    • Special entitlement Care
      Had he been anyone else, he would be thrown in jail - Period. Held without bond. But he gave millions and millions of dollars to the GOP and thus he is entitled to special considerations - why anything less than what Charlie White is getting for felony theft and voting fraud.
      • Great timing
        Will be in the news cycle during a presidential election year. Dream come true for Dems, especially if Mitch decides to run.
      • Flight RIsk?
        You don't really think he'd stick his ex and her dad for $1MM, do you? Only a real scumbag would do something like that. Unless, of course, he's already paid them 10x that much....Hmmmm....
      • Air Africa
        Better keep a tab on those one-way tickets to Namibia, ala Kobi Alexander.
      • Are you kidding?
        No matter what his crime involved, he is charged with it. (Further, he stole more money than many bank robbers!) Why should he be given leniency? Put him in the halfway house and let him enjoy some PB&J for awhile!!!!
      • amazing!!!!!
        June 2012!!!!!! OMG!!! what is going on here!!!!!!!!!!!
      • Lifestyles Of Rich and Famous
        Will he be inviting camera crews into the halfway house to show it off?
      • Indiana is corrupt
        Wow! what corruption please let IBJ dig into this matter more, and find out who this judge is friends with!

      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. Uh, sorry Johnnie, but you are incorrect. Despite the assertions by yourself and various defenders and captains, sports attendance is NOT off significantly at most sporting events in the US. Variances in attendance has been in the range of single digits, both + & - for years now. MLB has had most of its best overall attendance nubers in the last decade, and that trend has been consistent for most major sporting events. The number one issue cited by most fans when asked about attendance is the overall cost of attending. The presence of HD and big screen televisions in home doesn't even register, as a factor for not attending an event. VALUE in the product is the key, and apparently is something lacking in the current ICS. What other explanation is there when with what is routinely touted as the "best" racing on the planet, fans are staying away in DROVES. A "close" title battle into the last event at Fontana, with the "cars and stars" of the ICS, and who showed up? MAYBE 8K. Sorry, but HD TV isn't to blame for that kind of fan apathy.

      2. Do you need finance to establish your business ? Are you interested in getting a loan at 3% from our private company? If so please Email: suntrust_oil@blumail.org

      3. If she was worth the $ the public outcry over direct tv dropping them would have kept them on their dishes as we have seen with other companies. I too quit watching channel 13 after she showed up since I left channel 8 because of her all show rather than production results. When Randy on 8 corrected her she had a big head and incorrectly challenged his correction for pronunciation of a city. Other antics while she matures was too much for me with her very inaccurate forecasts. All the forecasters were predicting rain until Thursday except Chris. They predicted sunny on Thursday but instead of rain until Thursday upon which the sun would finally make it out in full glory Chris was right on the money just as I too predicted looking at the radar on weather.gov. One thing I love about Angela is the fear you can see in her every time it thunders in the winter. It far exceeds the entertainment value of her body language (high heel noise drags, depression, etc) when her forecasts are so incorrect. Her hair stands on end, you have to see it!!!

      4. Good Day, Apply For A Loan I am Mr Fernadez Antonio, a private Loan lender and a cooperate financial for real estate and any kinds of business financing. I also offer Loans to individuals, Firms and cooperate bodies at 3% interest rate We offer any kind of loans. email us via fernadezloaninvest@outlook.com LOAN APPLICATION FORM First name:......................... Middle name:......................... Last name:........................................ Date of birth (yyyy-mm-dd):....................... Gender:........................................... Marital status:................................... Total Amount Needed............................... Loan Duration.................................... Address:.......................................... City:............................................. State/province:................................... Zip/postal code:.................................. Country:.......................................... Phone:............................................ Fax:.............................................. Mobile/cellular:.................................. Monthly Income.................................... Occupation:....................................... Best Regard, Mr Fernadez Antonio.

      5. i will love to share my testimony to you all the people in world i got married to my husband about 2 year ago we start having problems at home like we stop sleeping on the same bed,fighting about little things he always comes home late at night,drinking too much and sleeping with other women out side i have never love any man in my life except him. he is the father of my child and i don't want to loose him because we have worked so hard together to become what we are and have today .few month ago he now decided to live me and the kid,being a single mother can be hard sometimes and so i have nobody to turn to and i was heart broken.i called my mom and explain every thing to her,my mother told me about DR.okoro how he helped her solve the problem between her and my dad i was surprise about it because they have been without each other for three and a half years and it was like a miracle how they came back to each other. i was directed to DR. okoro on his email:okorospell@gmail.com and explain everything to him,so he promise me not to worry that he will cast a spell and make things come back to how we where so much in love again and that it was another female spirit that was controlling my husband he told me that my problem will be solved within two days if i believe i said OK So he cast a spell for me and after two days my love came back asking me to forgive him i Am so happy now. so that why i decided to share my experience with every body that have such problem contact Dr okoro the great spell caster on his email addresses spellcasterforlove@outlook.com

      ADVERTISEMENT