Thursday, June 24, 2010

FBI Seizes Durham's Cars

Alleged Ponzi scheme operator Tim Durham amassed a collection of valuable cars worth several million dollars. According to an online report tonight on the Star's website, FBI agents served warrants and seized cars belonging to Durham in Indianapolis and Los Angeles. Acting U.S. Attorney Tim Morrison filed a forfeiture action last November against Durham-owned properties, including his valuable collection cars, last November after FBI agents raided his offices in Indianapolis and Ohio as part of its fraud investigation of Fair Finance, an Ohio company owned by Durham that has subsequently gone into involuntary bankruptcy. Morrison abruptly dropped the forfeiture action only days after filing it after receiving assurances from Durham's attorneys that his assets would not be converted or wasted.

Durham's attorney, Barnes & Thornburg's Larry Mackey, reacted with anger to the news of the seizure of the cars.  "If the FBI were as focused on investors as they are on creating headlines, they would know that today's (Thursday's) seizures were a total waste of taxpayer monies," Larry Mackey told the Star. Mackey says Durham turned over title to the cars to the trustee overseeing the bankruptcy of Fair Finance months ago. "(Thursday's) seizures were another unfortunate example of the FBI acting before they get the facts," Mackey said. "The honest taxpayer loses now as the FBI's actions today have only served to start a battle with the trustee; whose time to fight that battle will sadly reduce recoveries for the investors. Avoidable, embarrassing and regrettable."

Mackey would be correct in his assertion if the FBI seized the vehicles with the intent of keeping the proceeds of the sale of the cars for the government. It's not clear to me, however, that the FBI didn't act for the benefit of the investors in Fair Finance, who stand to lose as much as $200 million if substantial assets are not recovered from Durham. WISH-TV was on hand to witness the seizure of cars at a downtown garage owned by one of Durham's companies. WISH-TV indicates that the trustee for Fair Finance said the FBI gave him a courtesy call prior to carrying out today's seizures at three locations in two states.

UPDATE: An attorney for the bankruptcy trustee is now telling the IBJ's Greg Andrews that the FBI seized Durham's vehicles for the benefit of the Fair Finance investors. In that sense, the attorney tells Andrews that the FBI is not competing with the bankruptcy trustee. It looks like Mackey's disinformation campaign against the government just fell apart.


Diana Vice said...

It's about time! Spend as much tax money as you need to put crooks behind bars!

Unknown said...

I am guessing the FBI took the cars for impending IRS criminal charges (tax evasion.) Larry knows darned well the money always goes to victims first, nice pitch and rhetoric though from Mackey. Hopefully Larry will be required to return his massive retainer and fees--he also knows you cannot accept stolen money for legal services.

PS, Larry--you are a busy man lately. Have you been meeting with a certain money manager wife of a certain attorney, you know that gal who traded in Cellstar on inside information and helped a lot of the dopplegangers make money on that? Cuz I think that stuff is about to be charged but what do I know? In fairness to Timmy and the gang no one has been criminally charged with any wrongdoing.