Friday, March 22, 2019

Cashing the Checks Until He Couldn't

Life is always about timing and the Lamar Adams case is no exception.  One poor victim bought $100,000 of phony timber investments from William McHenry and Lamar Adams literally hours before the SEC froze all of Adams' assets.



U.S. District Judge Carlton Reeves denied a motion to order the receiver to return funds on March 13.  The order tells the sad story:

On April 20, 2018, John Endris invested $100,000 with Madison Timber Properties. William McHenry moves for the Receiver to return that investment. The Receiver and the SEC oppose the motion.

On April 19, 2018, Endris gave McHenry a $100,000 check for an investment with Madison Timber Properties (“MTP”). Hours later, Lamar Adams turned himself in to federal authorities and admitted MTP was a Ponzi scheme. The following morning, McHenry, unaware of Adams’ actions the previous evening, deposited the $100,000 check from Endris into a MTP bank account at Southern Bancorp Bank. Later that afternoon, the SEC filed its complaint against Adams and in the early evening the Court entered an Order permanently freezing the assets and all operations of MTP. See Docket No. 5.

McHenry argues that the bank’s acceptance of the $100,000 deposit on April 20, 2018, and the government’s failure to reverse and cancel the check, is a violation of the Court’s Order.1 The SEC and the Receiver, with the support of the Mississippi Secretary of State’s office, oppose this request because the check was deposited before the Order was entered and it would force the Receiver to prioritize the recovery of one victim over many others.

The SEC has also moved to file a sur-reply to include two new affidavits. One of the affidavits is from Southern Bancorp’s senior vice president and he attests that the deposit was made before the Court issued the Order....

Even though Endris lost his money in the final hours of the Ponzi scheme, he must wait with the other victims and allow the Receiver the opportunity to more thoroughly complete the job the Court appointed her to do.

This motion is denied.
McHenry was indicted for securities and wire fraud earlier this year.  


Kingfish note: So Adams & Krewe was still taking money even while they were talking to the Fibbies.  Classy.





11 comments:

Anonymous said...

If you invest in a forest that doesn't exist, does it make a sound?

Anonymous said...

Any relation to Craig Endris?

Prosecutors say Adams would buy timber rights from landowners and then sell the rights to lumber mills at a higher price. They say Adams and his company, Madison Timber Properties did not have the rights except for a few occasions. Loans guaranteed investors 12-13 percent interest. Craig Endris, a victim of the Ponzi scheme, says he did business for about 10 years with Adams and was at the hearing.

"You go to the bank every month and put in a large amount and it's a good every month and you complete your investment with him," said Endris. "You make your money. They call you back. They're fixing to buy more timber. You want to get back in and you want another deal with us? Sure I do. Why would I not ? The last one was good, and they've all been good."

Endris tried to confront Adams in the courtroom but was stopped by a marshal.

"What would you want to do if he took your life savings?" "He's a smooth operator," said Endris. "He'll get you to trust him, and there's no reason not to believe him," said Endris.

Kingfish said...

I think John is his father. Feel free to correct me. I saw Craig in the courtroom at the hearing. I think he told one reporter Adams had ripped off his parents .

Anonymous said...

Indeed it does. WAIT! I'm mistaken. That was the sound or air rushing when McHenry's asshole tightened up.

Anonymous said...

Are you kidding me? That McHenry guy had the unmitigated gall to try to tell a federal judge how to do his job better.

Anonymous said...

Will participants like Craig, who seems to be implying that he made money over the course of 10 years, be subject to a clawback of any profits?

Anonymous said...

10 years, at 12-13 percent guaranteed. Evidently putting $100k+ in a month?

Cry me a river, this guy made millions as a result of a criminal enterprise.

Anonymous said...

So the good news in this whole scenario is that no actual trees were harmed in the investment!

Anonymous said...

John Endris IS Craigs father. Most of the money that was invested by the Endris' was John Endris' wife's family money. She was a Trolio from Canton. Old money. I've heard that it was close to 750+K loss.

Anonymous said...

"Will participants like Craig, who seems to be implying that he made money over the course of 10 years, be subject to a clawback of any profits?"

Yes, any money or anything of value received by anyone that can be traced to the fraud is subject to a claim (see the Ole Miss return of donations for example). "Profit" received by "investors" are at the top of any such receiver's list because it wasn't _profit_, it was literally money taken from Peter to pay Paul. In a perfect world, a receiver could and would get every penny obtained by Adams, the various "brokers," the "investors," even the merchants where money was spent (and return to them unused merchandise, unconsumed food and drink, etc.) and reallocate everything to put everyone back in the position they were in prior to the fraud. It isn't a perfect world at all so when the dust settles some will keep money or other things and some will lose them. The receiver's goal is to make the redistribution as equitable as possible and practical.

As to this family and their "profit" and loss, *IF* it was basically the same "family pool" of funds and that "pool" had received considerable "profit," an attempt by the family to slip in a loss claim under the guise that it is different person making the loss claim than the person who handled the "investments" and received "profits" in the past, it probably won't work out very well for that family or their shared pool of funds when the dust settles.

Cynical Sam said...

Get in line sucker...no cuts.

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