Evans Seeks to Postpone Exam Re: Trust Account
by Amy McCullough
Published: June 3,2010
JACKSON–Charles Evans Jr. is set to be questioned this week about his trust account, but he is trying to postpone the exam, claiming that he cannot comply with bankruptcy court wishes because he is currently jailed on felony charges for resisting arrest by U.S. Marshals.
According to a bankruptcy court document filed today (June 3), one of Evans’ attorneys, along with his brother Chris Evans, gained temporary access on Wednesday to a unit at Uncle Bob’s Self Storage in Jackson where Evans, and possibly his brother, have documents stored. There are a large quantity of documents in the unit, and Evans attorneys state that they cannot examine the documents with the help of Charles Evans Jr.
Without Evans, parties will not be able to determine which documents comply with the subpoena, violate the attorney-client privilege of Evans’ various clients, or implicate Evans’ constitutional right not to incriminate himself, the filing said.
Charles Evans Jr. is set to undergo a Rule 2004 examination on June 8 and 9 led by numerous lawyers from Mississippi Valley Title Insurance Company (MVT) and more than 30 Mississippi banks, which were allegedly defrauded by him and his brother Chris Evans.
A Rule 2004 examination under U.S. Bankruptcy Code is a thorough investigation of a debtor’s estate by a creditor. Under the rule a debtor’s attendance for examination and the production of documents may be compelled. The examination may relate only to the acts, conduct, property, liabilities and financial condition of the debtor, or to any matter which may affect the administration of the debtor’s estate.
Chris Evans filed for bankruptcy in October.
More than $40 million in claims have been filed against MVT by banks, which were used as investors in an alleged Ponzi scheme conducted by the Evans brothers. Public records show that the brothers stacked multiple commercial real estate development loans on single pieces of property. Loans were obtained through shell companies, using various parcels of land as collateral, when the title to the collateral was often not owned by the business entities obtaining the loans. As the brothers defaulted on loans, banks scrambled for rights to the land and for payment from the insurance company.
Charles Evans Jr. was an approved attorney who wrote title insurance policies for MVT. Alleged illegal activities began in 2003. The shell companies owned properties in Madison, Harrison and DeSoto counties and also in the state of Texas. The brothers were first sued in September by MVT. The case is being handled by federal bankruptcy court in Jackson.
No criminal charges have been filed in the case regarding fraudulent activities.
Charles Evans Jr. was arrested on May 26 by U.S. Marshals in the MetroCenter Mall parking lot in Jackson after resisting arrest. He was in possession of a firearm. Bankruptcy Court Judge Neil Olack had issued a warrant for Evans on May 21 after holding him in civil contempt for failure to appear at a hearing and surrender information about his trust account.
Evans is being held in Madison County jail awaiting his next hearing on the felony charges. Law requires that he be indicted within the next 30 days.
A Mississippi Valley Title Insurance attorney said recently that the company believes Evans has access to significant funds.
An FBI agent testified this week in federal district court that although the agency has been investigating the case for almost a year, it still cannot determine whether Evans has significant funds left.
MVT has $30 million set aside for claims reserves, which is not enough to pay the 65 claims made by banks. The company’s parent, Old Republic National Title Insurance Company (ORNT), jointly issued all of the company’s policies. ORNT has several hundred million in claims reserves.
An FBI agent testified in federal district court that the agency has been investigating the case for almost a year but still could not determine whether the brothers have significant funds.
Evans defense attorney, John Collete, said Evans does not have money.
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