This post is reprinted with permission of The Taxpayers Channel in Greenwood.
Yesterday, Craig Geno, the attorney for bankrupt Express Grain, finally filed EG's April and May 2022 Monthly Operating Reports.
A comparison of the April and May reports discloses that in May, 2022, EG paid out $57,553,754.25 in grain settlement money to UMB Bank, StoneX, Macquarie, and a few farmers.
This money was paid out as final settlement of the 557 Grain dispute, where farmers, UMB Bank, StoneX and Macquarie were contesting ownership and/or collateral interests in the grain that EG had on hand when it declared bankruptcy on September 29, 2021.
Farmers had delivered some $48 million in grain for which they were never paid, while EG had sold and stored more grain to StoneX and Macquarie than the total amount actually held by EG.
The court had ordered that the grain be converted to cash, and according to the April 2022 report, the segregated cash amounts collected totaled $56.2 million on April 30. The last of the inventory on hand was sold in May 2022.
The $57,553,754.25 paid out in May to creditors broke down as follows:
$8,599,324.14 -- Consenting Farmers
$10,402,816.40 -- UMB Bank
$30,361,537.55 -- StoneX
$8,190,076.16 -- Macquarie
StoneX had claimed that EG owed it $36,084,000. Macquarie's claim was for $9,735,000. Both of these creditors therefore received 84.1% of their claims in this grainsettlement payment.
EG owed UMB Bank $70,589,128.70 in outstanding loans and interest payments, so UMB Bank only received 14.7% of what EG owed from the grain settlement payments. However, UMB Bank also obtained the rights to practically all of the physical assets of EG, which were apparently highly overvalued.
Precisely how much UMB Bank ultimately lost is not known publicly, but its losses are in the tens of millions of dollars.
The "Consenting Farmers" had agreed to the 557 Settlement Agreement. The full value of their claims is not known, as the list of consenting farmers has not been publicly disclosed.
Most of the farmers, however, did not accept the settlement, and rather "disclaimed," or renounced, their interests in the grain that they had delivered. Most of them will pursue UMB Bank under attorney Don Barrett's accusation that the bank conspired with EG to effectively "seize" their grain to pay off UMB Bank's loans.
To understand the complexities of the 557 Grain Settlement, and why so many farmers objected to it, please see here: Express Grain Bankruptcy Court approves Settlement Agreement over disputed grain proceeds
To understand how EG misrepresented its grain inventory ownership and sold more beans than it actually possessed, see here: Filings show Express Grain repeatedly stole soybeans it had sold to others for almost two years
To read UMB Bank's description of how it was swindled by EG, see here: UMB Bank levels new fraud accusations against John Coleman and Express Grain
Finally, to read attorney Don Barrett's accusations against UMB Bank, and attempt to extract the farmers' money from the Bank, see here: Farmers double down in class action suit against UMB Bank in Express Grain failure
As for UMB Bank, it also has claims against EG president John Coleman, who is also in bankruptcy, and Dr. Michael Coleman, both of whom signed guaranties to pay back UMB Bank in the event EG did not.
Operating Reports include the bank balances, the money taken in and spent, the company's balance sheet, receipts and payments, and other matters. The April 2022 report can be viewed here:
April 2022 Monthly Operating Report for Express Grain
Receipts and Payments
Balance Sheet
Statement of Operations
A/R Aging
A/P Aging
Inventory
Payments to Professionals
The May 2022 report can be viewed here:
May 2022 Monthly Operating Report for Express Grain
Receipts and Payments
Balance Sheet
Statement of Operations
A/R Aging
A/P Aging
Inventory
Payments to Professionals
Monthly Operating Reports must be filed every month until the bankruptcy case is concluded. As of the time of this publication, the June, July, August, and September operating reports have not yet been filed.
11 comments:
The Taxpayers Channel has done a good job covering the story.
Michael and John Coleman are both crooks. There is no denying it. I hope both get long prison terms (they won't). Even the things they have done since being busted have shown them to be nothing but low-life con artists. Both of them. The father and the son. Hiding assets, refusing to show up at hearings, etc.
There are no winners in this thing.
Everybody (shown) wound up with more in settlement than they ever anticipated. Prove me wrong.
@807 maybe, maybe not. You can't tell how many consenting farmers there are or what their total claims were.
When EG was telling farmers to bring their grain with higher moisture content and paying higher than other grain elevators, it caused many to question what was going on. When the farmers stopped taking their grain because word had gotten out that they weren't going to get paid, EG threatened to sue.
Even now, there is some rumblings inside the bankruptcy proceedings to go after the farmers who didn't fulfill their contracts because they knew they wouldn't get paid. How is that justice?
For that reason, and many more, I hope that Don is able to take UMB to the proverbial woodshed and get relief for the farmers who got hosed in this whole fiasco.
Consenting farmer here. Paid in full.
@945, I'm intrigued a consenting farmer (or any farmer) would be posting to a blog during the day in the middle of harvest season. Call me a skeptic.
"@807 maybe, maybe not. You can't tell how many consenting farmers there are or what their total claims were."
What ifs, imaginary unknowns and speculation don't count. Nobody knows what the farmers total claims were as compared to the counter suits for them backing out on their prior contracts (and what the outcome of that could be).
It's a spider web for sure. Can it be un-webbed. Probably not. That's why judges are issued gavels.
9:45, were all the consenting farmers paid in full? If so, that would mean that there weren't very many farmers who agreed to the settlement. At the time the settlement was discussed, it was anticipated that the settlement would only pay 20 cents on the dollar, but if most farmers rejected the settlement, then those that consented would receive a higher payout.
Has Big Hat Pumpkin Farmer Gipson stepped up his state established regulatory game any since his (and Tater's) State Grain Warehouse regulators failed to regulate the business they were supposed to regulate?
John Pittman Hey,
My understanding is that all consenting farmers were paid in full. And, it was a small group.
As to the other guy, our harvest is done minus a week’s worth left of picking cotton.
1:46, thanks for that update! I have since heard from another consenting farmer that he was paid almost all of his claim. May have been some dispute about the figures he submitted, etc., to explain the difference.
I'm glad it worked out for some of the farmers.
But looks like almost $40 million of the other farmers' claims were NOT paid out. Very sad.
Every Delta farmer I know has a drawer full of sharp pencils.
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