CONCORD, N.H. (Legal Newsline) - Involuntary petitions for bankruptcy have been filed by Attorney General Michael A. Delaney against two New Hampshire businesses abandoned by their owners.
The petitions, filed in the United States Bankruptcy Court, District of New Hampshire, allege that Scott Farah, sole shareholder of Financial Resources Management, Inc., and Donald Dodge, sole shareholder of C L and M, Inc., have abandoned their Meredith, New Hampshire, businesses.
Delaney's office has been contacted by individuals claimed to have lost approximately $23 million owed to them by the two companies.
Money obtained from various investors by the two companies, the state has learned, was used for the construction of housing developments and other construction projects, building of single family homes or renovating existing homes.
Additionally, those who obtained mortgages from FRM who are both ready and willing to make payments on their outstanding mortgages have found themselves unable to determine where to direct their payments. Some investors, fearful of losing their investments, have begun demanding direct payment from homeowners or threatened to take possession of property securing the various loans.
"I have taken this action in order to begin the process of an orderly and lawful dissolution of both FRM and C L and M, Inc.," Delaney said. "This step is necessary to provide assurance to those who, in good faith, obtained loans from FRM and C L and M, and are looking for a procedure for making future payments. The filing of the bankruptcy petitions will also begin the process to establish a system for the orderly distribution of assets to creditors."
The Bankruptcy Court is asked by Delaney's petition to enter an order directing the United States Trustee to appoint an interim trustee charged with taking over the assets of the two corporations.
"The appointment of an interim trustee is important and necessary where, as has occurred in this case, the businesses have been abandoned and valuable property has been left unsecured," Delaney said.