The trustee for bankrupt Fair Finance Co. will be filing claims against some holders of Fair Finance investment certificates and asking them to return money they made on the certificates.
The investors were not identified in the trustee’s status report filed late Monday and discussed Tuesday morning in U.S. Bankruptcy Court in downtown Akron.
Brian Bash, the Cleveland-based trustee for Fair Finance, said he “will be pursuing certain payments made by [Fair Finance] to investment certificate investors as preferential payments . . . or fraudulent transfers.”
Bash said “preference payments” total $932,865.94 and “fraudulent transfer payments” total more than $2.6 million.
“In connection with any such claims, the trustee is committed to taking into consideration the possible financial impact of the Fair Finance bankruptcy on the investor and reviewing any individual cases of financial hardship in connect with such claims,” the status report says.
About 5,300 Ohio residents and organizations bought more than $200 million in uninsured Fair Finance investment certificates.
Fair Finance was forced into bankruptcy in 2010 following FBI raids just before Thanksgiving in 2009; the longtime consumer loan and accounts receivables business never reopened. Fair Finance’s Indiana owners, who bought the company in 2002, are awaiting trial on federal charges that they operated the company as a Ponzi scheme.
Bash also is filing waves of lawsuits seeking to bring in tens of millions of dollars into the Fair Finance estate for eventual distribution to creditors who largely are investment certificate owners.
Bash filed 27 lawsuits last week and anticipates additional “waves” of lawsuits to be filed through Feb. 3.
Jim Mackinnon can be reached at 330-996-3544 or firstname.lastname@example.org.