Man indicted, accused of bankruptcy fraud
Published: April 13,2014
JACKSON — A Jackson man was indicted Wednesday on charges that he defrauded his bankrupt business of more than $9 million.
William “Butch” Dickson faces charges in U.S. District Court in Jackson. The 58-year-old is being held without bond in Mississippi, and a court appearance was set for Tuesday.
Federal prosecutors say that after Dickson’s company, Community Home Financial Services, filed for Chapter 11 bankruptcy protection, he wired nearly $9.1 million from company accounts to a bank in Panama. Prosecutors say he also sent mortgage checks the company had collected to Central America.
Prosecutors said Dickson was expelled from Panama on March 12, arrested on his return to the United States, and ordered held without bond by a U.S. magistrate judge in Miami.
The indictment charges Dickson with six counts of bankruptcy fraud, six counts of bank fraud and five counts of wire fraud. He could face decades in prison and millions of dollars in fines. Prosecutors also want him to forfeit the money in question.
A lawyer for Community Home in the bankruptcy case did not immediately return a phone call Friday. It’s unclear whether Dickson has a criminal lawyer.
The company, which had a downtown Jackson office, was in the business of collecting mortgage payments for debts that it and others owned. It was servicing several thousand accounts, according to court papers. Community Home said its revenue business was about $5 million a year in 2010 and 2011.
Community Home filed for Chapter 11 in 2012, claiming nearly $45 million in assets and $30 million in liabilities. Dickson was placed under certain restrictions, but left in charge of the company and its bank accounts, as is typical in a Chapter 11 proceeding.
The bankruptcy case included a side dispute over whether Community Home really owed money to its two main creditors, Edwards Family Partnership of Baltimore and Beher Holdings Trust of Bermuda. Those related entities told the bankruptcy court that Community Home owes them more than $30 million, and that they are the true owners of many if not all of the mortgages that Community Home was servicing. Jim Spencer, a lawyer for the creditors, declined comment Friday.
FBI Agent Bradley Hentschel testified that, starting in November, Dickson began wiring money from Community Home’s accounts to accounts at Banco Panameno in Panama.
In December, a lawyer for Community Home filed notice that the company was moving its operations to Costa Rica and Panama. U.S. Bankruptcy Trustee Kristina Johnson, who’s in charge of protecting funds for creditors, quickly moved to take over the company’s finances and operations, locking out Dickson.
Dickson refused to hand over the books and the money, court papers say. Prosecutors also allege that the company closed its downtown Jackson office and began directing customers to send loan payments to a Las Vegas address, where they were boxed up and sent to Costa Rica. After the bankruptcy trustee discovered the Las Vegas address, Hentschel testified that the company directed mail to a Miami address.
The trustee, in bankruptcy papers, said she has struggled to reconstruct the company’s books, including who still owes it money for mortgages, and is working with Community Home’s creditors to try to piece together complete records. She said she plans to hire a new servicing company to take over the work.
To sign up for Mississippi Business Daily Updates, click here.
5 Responses to “Man indicted, accused of bankruptcy fraud”
Top Posts & Pages
- Barbour to lead Butler Snow economic development firm
- Kemper plant employee gag order continued
- (UPDATE) Prison won’t interrupt ex-prison chief’s retirement cash flow
- Delta State conference brings renowned speakers
- (UPDATE) Judge rules on Google request on attorney general inquiry
- The leadership styles of President Obama
- Ex-prison boss and businessman admit to bribery scheme
- MARTIN WILLOUGHBY — Doug Dale’s self-awareness helps lift him to top of his game
- Analysis: Lawmakers squabble over election-year tax cuts