Monday, December 28, 2009

The Tale Of Durham's 1930 Duesenberg

The sale of a 1930 Deusenberg at Auburn auto action last Labor Day weekend is causing a lot of consternation for Dowagiac, Michigan Mayor Donald Lyons. A Virginia businessman, who paid $2.9 million for the collector car, charges in a federal lawsuit that accused Ponzi scheme operator Timothy Durham, Lyons and others with an interest in the car defrauded him. James Scott accuses persons who held an interest in the car of running up the bid at auction to boost the selling price of the car. A story in the Dowagiac Daily News sheds more light on what transpired. Lyons told the newspaper that he and his wife did not do anything wrong and bid on the car in good faith. The details of the sale, however, don't look real good for Mayor Lyons.

Durham had agreed to sell the classic car to Lyons for $1 million prior to the auction. Because the car had already been advertised, and the museum on the grounds was to receive a donation from the sale of the car, Durham's Diamond Auto Sales was unable to consummate the agreement with Lyons. Instead, Lyons attended the auction with an agent, Mark Hyman. According to Lyons, nobody expected the car to go for more than $1 million at auction, and he fully expected to walk away with the car. Nonethless, Hyman continued the bidding against Scott for Lyons until the price reached $2.9 million. Lyons' last bid was $2.8 million.

The story gets interesting when you see what transpired after the auction. Durham offered to sell the car to Lyons for the original $1 million selling price if he transferred the funds within a week. Durham told Lyons and Hyman they could split the balance of the proceeds from the sale of the car to Scott for $2.9 million. Durham told Lyons and Hyman that he would transfer title to the car directly to Scott. Lyons and Hyman agreed to the deal and received their share of the proceeds from the sale. What they didn't know, according to Lyons, was that Durham never transferred title to Scott. As it turned out, Webster Business Credit Corp. held a lien on the car for money it had loaned to Diamond Auto. Following the sale, Diamond Auto never sent the money to Webster it needed to pay to extinguish the lien on the car. The bank is also named as a defendant in the lawsuit.

What do you think? Are Lyons' hands clean in this deal? The deal Durham offered him sounds an awful lot like the e-mails I receive from some Nigerian heir seeking assistance in obtaining the proceeds of a huge family estate. I just have to agree to facilitate the transfer of funds by handing over my banking information, and I get to keep a portion of the proceeds for just being a nice guy and helping out. We know how all of those deals end. If it looks to good to be true, it probably is. One would think that Mayor Dowagiac would have smelled something when he agreed to transfer $1 million to Durham so he could almost double that amount with his agent. Lyons is, after all, a very successful businessman. If Durham didn't pay off the loan to the bank with the $1 million he received from Lyons, what he do with that money?


Erich said...

Why would the news article not mention Durham's name, at all?

Also odd that Lyons, Hyman and Scott all claim to have sent money without receiving title to the car. No escrow?

And Lyons sold the car without ever having title? Sounds like a problem.

Gary R. Welsh said...

The article refers to Diamond Auto Sales, the company Durham owns. Not sure why it doesn't mention he is the owner of the company.

Dowagiac Informer said...

The name wasn't mentioned because Lyons did this as a press release.

Mr Lyons is the MAYOR of a town and he cannot allow his name to be involved with someone that sems to have problems with the FBI

artfuggins said...

At least, it appears that Prosecutor Brizzi was not involved in the entangled web of this car.

Unknown said...

ArtFuggins, I wouldn't presuppose innocence for anything associated with Brizzi post-Durham.

This was on the Indianapolis Times, did everyone see this outlandishly awful ruin of an otherwise fabulous Bentley?

Unknown said...

It all sounds fishy to me....sounds like they were looking to make a little bonus for themselves.

Dowagiac Informer said...

Has anyone heard anything else on the court case?