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Trustee pressing Daniels, others to return Durham's donations

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The trustee in the bankruptcy liquidation of Fair Finance Co. is pressing Gov. Mitch Daniels and other prominent Indiana politicians to return money donated to their campaigns by Fair owner Tim Durham.

Trustee Brian Bash sent letters nearly two months ago to politicians who he says collectively received at least $900,000 in donations that Durham funded with borrowings from the Akron, Ohio, finance firm. Durham made some donations to Democrats but in far smaller sums than to Republicans.

The political donations were part of $54 million Durham borrowed from Fair, according to a slide show Bash presented to company investors on Monday in Ohio. Durham, a prominent Republican fundraiser, also spent Fair money on gambling, interior decorating, real estate and his other business ventures.

Only three politicians have responded to the letters—including Daniels—but none has yet committed to give Durham's donations back, according to attorneys working for Bash.

"We are disappointed that we've not had more responses," said Kelly Burgan, one of Bash's attorneys. She added, "It's not uncommon for politicians to return tainted funds."

The letters are the first step in the trustee's efforts to recover the money from politicians, Burgan said. But he has additional legal options, such as moving to have a judge declare Durham's donations fraudulent transfers. Bash intends to use all legal tools he has to get the money back from Hoosier politicians, Burgan said, but his next steps will depend on the circumstances of each donation.

Daniels received at least $195,000 in Fair money from Durham, according to Bash's calculations. The Indiana Republican State Committee garnered at least $185,000. The House Republican State Committee got $60,000. And the Greater Indianapolis Republican Finance Committee collected $33,000.

Durham gave the most money—$225,000—to his close friend Carl Brizzi, the Marion County prosecutor. Brizzi has yet to receive a letter because it took Bash's team longer to sift through local political fund-raising filings, compared with state and federal records, which are easily searchable online, according Joe Esmont, another attorney working for Bash. Esmont said a letter should go out to Brizzi within the next week.

Asheesh Agarwal, an attorney who represents Daniels' Aiming Higher political action committee and his Mitch for Governor Campaign Committee, acknowledged receiving a letter from Bash. But he indicated in a written statement that Daniels' organizations do not intend to refund money already spent.

"Based on what we know now, it is not out of the question that some of the money could be returned, but we need to see more than a letter from an attorney," Agarwal said. "In fact, if a court finds wrongdoing, and these funds were the source, a refund of any remaining dollars would be appropriate."

Likewise, the Indiana Republican Party said it will wait for a court ruling before giving any of Durham's money back.

"It has long been our practice to spend the money we raise in the election cycle in which it was donated. This is certainly the case with Mr. Durham's contributions, as his donations came several years ago," Trevor Foughty, a spokesman for the party, said in a written statement. "At this point, it is too premature to say if we would deviate from that practice, and we will withhold further judgment and comment until a court rules in the case."

The Durham loans represent the largest chunk of more than $168 million in related-party loans issued by Fair. The company’s lending spree began shortly after Durham and partner Jim Cochran bought the business in 2002, according to securities filings.

Fair Finance shut down in late November, after FBI agents raided its offices and seized records. The same day, the Justice Department filed court papers alleging Durham was operating Fair as a Ponzi scheme, selling new investment certificates to pay off prior purchasers.

Fair had 5,000 investors, who are now owed more than $200 million.

"Most of Fair Finance Company’s creditors are individuals of modest means. Many are retirees who put their life’s savings into Fair Finance 'investment certificates,' and are now scrambling to survive," Bash wrote in his letters to politicians' campaign committees and fund-raising groups. He added, "I anticipate that the committee will make the honorable decision to voluntarily return the contributions of Durham and his related entities to me, to be used in furtherance of compensating the victims."

An FBI investigation continues. Durham has not been charged with a crime.

Durham, 47, has acknowledged owing lots of money to Fair, but denied defrauding investors. In court papers, his attorneys contend offering circulars provided to prospective purchasers of investment certificates outlined the risks, including that they carried no government guarantee.

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  • Durham A Looser
    Tim Durham...class of 1980 Seymour High School. What a looser! When will he start to feel the pain that he has caused?
  • Geist is for wannabes
    I am with you-- who would want to live with all those losers!! None of them have pot to ..ss in and they all are upside down in their homes, living on credit cards which they cannot pay. We will all end up paying for their lavish, FAKE lifestyles. NO REAL people there
  • We're still SOO admiring you geisters
    Is it just me or is Geist JUST THE PLACE TO LIVE!! Oh Boy we're so much better than everybody else in Indy! What's up with everyone in Geist being investigated by the FBI, Jumping out of planes to fake their deaths, running up their credit card debt fueled lifestyles, then acting like kings of the hill? I watched that Schrenker dateline special the other day and they had that Pat Corneni or whatever her name is on there all smiles about how Wonderful geist is and how they're so admired, should have TV shows, etc. YAWN. Are there any homes in Geist that AREN'T upside down? I have a great idea for your reality TV show PAT. Call it Adolescent Adults with Financial risk. I won't be tuning in. This has been going on for years, nobody cares. Get lives people, nobody cares!
  • TO J
    Ill bet you are a loser J
    • Losers!!
      Today's paper read "personal loans to family & friends" exceeded $16 million. Trustee states most of them are unable to pay back because they are insolvent-- LOSERS -- live in geist and live a lie.. Most can't even run lemonade stands.
    • legal fees
      IBJ should look into what the trustee has collected in legal fees ,so far,I believe his fee is 500 an hour. Who is the thief here?When he gets thru these poor people will hate him as much as Fair.
    • Sick of it
      I'm calling the FBI on Monday. HOW FLIPPING LONG is the shirade going to continue??? Carl Brizzi is Andrew Jackson Reincarnated in my book. And Mitch, what the hell? The money's been spent, sorry. We all know you BOTH have enough money to make due and return it. This is the first time in my life that I am ashamed to be a hoosier. I never thought that this thought would ever cross my mind. UNBELIEVEABLE. How much forensic evidence is necessary to END this episode and put away these politicians who are a DISGRACE. How can you wake up every day and call yourselves politicians? Aren't you supposed to be public servants and dedicate your actions to the well being of the people you represent? All I see are a select few with their pockets lined looking the other way. Unreal. I have no sympathy for the elderly in Ohio who were robbed. They were greedy and took a risk and the risk granted them no reward. However, Carl Brizzi and Mitch Daniels are 100% morally bankrupt and have no interest in serving the community. A message to all hoosiers. Pick up your phones on Monday, call the FBI and ask them why they haven't arrested Carl Brizzi. My guess is Durham has the ULTIMATE ace in the hole and nobody can trump it. There is NO other explanation as far as I can see.
    • Indiana Morally Bankrupt Politicians???
      You are so totally right on doing the right thing... If I were a Ohioan you are correct they should demand the OH AG, OH GOV send CERT Letters to My &itch Mitch and Dirty Brizzi's Briefs and say DO THE RIGHT THING...
      There money is nearly $500,000 alone...

    • don't forget the interest
      that trustee keeps forgetting to mention the unpaid interest...for Dan Laikin it's about $10M on the $11M loans (even tho he took more) because the interest compounds...on Tim Durham he owes over $50M in interest, making the sum outstanding he "owes" over $100M....shall I go on?

      These losers got a free ride off the backs of elderly, naive, trusting Ohioans. What would Mitch do if the residents had been Hoosiers?

      Everyone needs to fax the Ohio Governor and tell him to give Mitch a talking to.
    • re
      Durham "borrowed" money? LAUGHING!!!!

      You lend me money to lend to someone else--an operating business that is profitable and has recurring revenue-- for a margin. Instead I "lend it to myself" by blowing it at King's Image, girls, trips, blah blah blah. That is not "borrowing" but instead stealing.

      Durham thinks he is so clever. We'll see.

      With regards to Mitch, it doesn't matter what is legal or not, it matters what the perception is. Any skilled politician knows that. So, Mitch doesn't want to be President after all. Glad to know that.
    • Grandstanding
      Mr. Bash is making a big mistake by grandstanding in the media and trying to show that he is tough. He knows as well as anyone that there is no legal precedent where Gov. Daniels, Mr. Brizzi, et al would have to return anything and using cooperative media for pressure will not work on outgoing politicians who do not seem to have future ambitions. All we keep hearing is 'under investigation'; 9-mos. and no charges, yet this is still a story. Changing reporters for additional Durham/Brizzi bashing still does not make this interesting. Next time include the lines: "Durham would not comment" or "Brizzi refused to speak" or "the FBI will not comment," unless of course you are not actually investigating the story.
      • all funds should be returned
        KW -- good point -- I agree. All of the tainted money, large or small, Rep or Dem -- should be returned by the politicians - the notion that the money has been spent does not hold true. But clearly this will adversely affect more Reps than Dems. That was the point that I was trying to make earlier -- this -- Durhams contributions -- were more a Republican thing than a Democrat.
      • Where's The Beef????
        It is nice to see that the bankrupcy trustee is moving forward. However, as it technically stands now, Durham used borrowed funds for donations and other activities. In the absense of LEGAL CHARGES, there is nothing wrong. Unless the FBI comes across with charges, Durham borrowing money he can't pay is no more wrong than homeowners borrrowing more than they can re-pay on their house mortgages. Bad idea, but nothing immoral. The implications have been strong, but in actions, little. Why doesn't the FBI either charge or exonerate him. Without that, the trustee can sing until the cows come home and nothing will happen.
      • RE: K W
        I'm sure it would take months and 20 pages to list everyone that has received campaign contributions. We would be reading about this 2 months from now if that was the case.

        At least they listed it. Fox News wouldn't have.
      • re
        How about when Carl called out to Oregon to screw over Larry, the guy Tim was suing? Have his coach impounded at the concert, claiming he was violating state tax laws? Remember that Carl? (PS, Yep, the FBI knows all the details.)

        What else has Carl done to help Tim...oh yeah, didn't he provide references against a certain whistleblower who Tim was discrediting so no one would audit him to find out the....gasp...obvious?

        As for donations from Carl, he can assign his 50% interest in the triple net lease deal he scored in Elkhart. That will pay back the donations over a couple of years. I think he's already blown the money he made from Tim's tip to buy Cellstar right before Brightpoint bought them. Wait, Carl still owns some Cellstar shares. I think he also knew the cash reserved for Verizon on the balance sheet wasn't going to be paid. Just thinky, Carlito, had y'all just distributed the cash instead of Timmy directing it to Fair Finance none of us ever would have known about Fair, Tim'd be sitting fat in LA and you'd not be under federal investigation.

        You remember all of this, right Carl?
        • Message to Tim
          Dear Tim,

          Remember all those posts you put on the Brightpoint message board when you, Jeff, Neal and Henri were pumping Brightpoint stock, those posts you made about how mentally ill I am and needed help?

          Golly, Tim, you were right. And, I got some help from Greg Andrews. And Jon Boccieri. And now you're going to need lots of help, aren't you?

          I never went away. And now you get to see all your little secrets come out. You should have left me alone.

          Love,

          Venus
        • Do not hide behind some WEAK theory that the money is spent...That is a morally bankrupt position
          If these politicians do not return the fraudulently conveyed money then it is proof positive what slime balls we have in office.

          To say they have a policy to not return money already spent is as Bogus as the way Durham ran Fair Finance... Go fund raise some more you slime balls and get the money back to the trustee.Where is your soul? You should have been reserving for more than the past year as you knew you would have to belly up to the bar and own up to being involved with someone who knew how to operate with OPM (Called Other Peoples Money). Now step up and be respectable Gentlemen and respectable Ladies as the case may be and set examples for our youth.

          Ever wonder why the Roman Empire Failed? Look in the Mirror!!!
        • WONDER HOW BRIZZI SPENT MONEY THAT WAS CONTRIBUTED... HOPE THE TRUSTEE GETS COURT ORDR O REVIEW
          Wonder what the average contribution has ever been by one individual for the Marion County Prosecutoral Candidate.

          If The BRIZZ refuse to cough it up then it will least create a reason for the Expenditures to be reviewed. Many bloggers have cited Brizzi spent money on lavash gifts, cigars, fine dining... if those funds were not used properly Mr. BRIZZ better go amend his 1040's....
        • Loving Your Money
          The only thing Brizzi loves more than himself is YOUR MONEY. No way Brizzi gives anything back. Carl Brizzi strongly believes 'what's his is his AND what's your is his'.

          Brizzi was/is a part time Prosecutor and full time scamer.

          Brizzi is way in bed with
          Bob Grand
          Ryan Vaughn
          Tim Durham
          John Bales
          Paul Paige

          They all belong behind bars for the crimes they have committed
        • Wondering
          Not that Durham deserves any less heat on him for this fraud, where is Jim Cochran in all this mess? He was a co-owner and also borrowed millions yet all we hear about is Durham.
        • The real issue
          Joe - I get your point but is the issue defined by the dollar amount or by the action itself? If a democrat, republican, or independent accepted $10 and the call to return the money is made, does it not apply to the $10, too? Seems like a very skewed logic to me.
        • Durham is a Republican
          KW -- given how closely this issue has been reported on (by the IBJ and others) I am sure that the amount of money given by Durham to Democrats, if significant would have been reported on. Yes, I would like to know which dems got funds and how much, but anyone would have to agree that the pattern has been almost exclusively republican. And I laughed when the story referred to Durham as a "prominent Republican fundraiser" -- I suppose fundraiser is defined rather loosely here -- as in looting a company you own. When are the indictments of Durham (and Brizzi, I hope) forthcoming?
          • Fair & Balanced?
            IBJ: Thanks for the 3rd sentence in this story referencing that Durham also gave money to the Democrats. Any particular reason that the other 18 paragraphs talked about the republicans and how much they got and we never did fiond out who the dems. were, nor how much they got? Biased much?
            • Fair & Balanced?
              IBJ: Thanks for the 3rd sentence in this story referencing that Durham also gave money to the Democrats. Any particular reason that the other 18 paragraphs talked about the republicans and how much they got and we never did fiond out who the dems. were, nor how much they got? Biased much?
            • Innocent
              Bush Sr. + Servaas + Rep. Party = TD sunnying himself in LA LA land.
            • Yes
              What happened to the comments?? Is crook Brizzi going to return the stolen money? Of course he won't! Was Carlito buying up Italian suits with Durham? Remember when he said it was too early in the investigation to jump to conclusions? Where is Lincoln Plowman these days? Proof has shown it's ugly head. It doesn't matter because Brizzi believes he is THE LAW and if he says Durham is innocent then he MUST be innocent and he's not returning any money! The funny thing is that it actually works and in all reality BRIZZI IS THE LAW! Give him a break though, he's still mourning the loss of the mansion and his favorite Dodge Viper!
            • Republican Party
              United we stand.
            • aw.....come on.......give it back
              Stand up and do the right thing and give back the funds! Nothing less will be accepted by the public and Gen. Shorty will certainly not want to finesse the facts along with IPALCO, and possibly Brightpoint when expanding his resume.
            • What!
              Look like Shorty's not going to return the money which means he must not want to be President that badly.

              Hey, does anyone know if it's true that Mitch traded in Cellstar stock right before Brighpoint bought them? Lots of other Durham cronies did.

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