It appears the last clawback lawsuit in the Lamar Adams case is finally wrapped up. SEC Receiver ALysson Mills asked U.S. District Court Judge to approve a $6.5 million settlement agreement with the UPS Store and other defendants in a motion filed on August 20.
The SEC Receiver was tasked with clawing back illegal profits earned by Lamar Adams and others in the $164 million Ponzi scheme based on phony timber investments. Ms. Mills sued the UPS store in Madison and several employees in 2019 for allegedly notarizing phony deeds in federal court. The complaint accused UPS Store notaries of notarizing the "deeds" even the "seller" was not present as required by law, thus allowing Adams to perpetuate his fraud. A synopsis of the case is posted below.
The motion spells out the terms of the proposed settlement agreement:
Under the proposed settlements, TUPSS, Inc. will pay to the Receiver the sum of $5,000,000; the Notary Defendants will provide total consideration of $1,500,000 (with a credit to the amounts paid by American Casualty) and American Casualty will pay $50,000 to the Receiver in addition to $100,000 previously paid by it, for a total of $6,500,000.
The lawsuit charged the defendants with gross negligence, civil conspiracy, and aiding and abetting. A hearing on the motion has not been scheduled.
Synopsis
SEC Receiver Allyson Mills sued the UPS Store in Madison and several UPS employees in U.S. District Court in 2019 for notarizing phony deeds in the Lamar Adams timber fraud scheme. The defendants are Herring Ventures, LLC, Austin Elsen, Tammie Elsen, Courtney Herring, Diane Lofton, and Chandler Westover. The SEC is trying to claw back illegal profits earned by Lamar Adams and promoters of a $164 million Ponzi scheme based on phony timber investments. Receiver Alysson Mills represents the SEC. She will recover assets, distribute them among the victims, and provide progress reports to the court. The Receiver claims the defendants "enabled" Adams to further his Ponzi scheme by notarizing the fake timber deeds each investor received for the investment. The timber deed claimed they gave Madison Timber the right to harvest timber on the subject land in each deed. The Receiver's claim against UPS rests upon this crucial argument: 27. The timber deeds appeared to have been signed by the landowner, as grantor, and Lamar Adams for Madison Timber, as grantee. Below the two signatures, a notary attested to the signatures’ authenticity and affixed his or her notarial seal. The following is representative of Defendants’ attestations:
However, the landowners never "personally appeared" before the notary. The landowners/grantors often did not exist. "In all instances, the grantor-landowners' signatures were forged by Adams," said Ms. Mills. She said the grantor's signature was the most "important mark" on the document. Without the signature, the right to harvest the timber on the subject property would have been unenforceable by the investor. Adams used several means to forge signatures:
sometimes Adams forged the grantors-landowners’ signatures before he presented the timber deeds to Defendants, such that it appeared that he or she had already signed. Other times Adams presented the deeds with a blank where the grantor-landowner would sign, such that it appeared that he or she would sign later. At no time, however, did any grantor-landowner sign the documents in Defendants’ presence.
31. Over the course of the Madison Timber Ponzi scheme, Adams fabricated fake timber deeds for thousands of investments—501 in the last year of Madison Timber’s operations.
A notary is barred from notarizing a document when the signature is blank or the signing party is not present. UPS offers notary services to the public. Ms. Mills accuses the UPS notaries of participating in the conspiracy to defraud investors by notarizing phony timber deeds and signatures.
Ms. Mills charged the defendants with civil conspiracy, aiding and abetting, and gross negligence. She charged the UPS Store in Madison with one count of negligent supervision and retention. The complaint argues UPS Store, Inc is liable for all damages awarded against the Madison store and its employees.
13 comments:
Does that mean those early investors will be able to keep their ill-gotten gains, to the detriment of later investors who funded those gains? Or is this a case where the last shall not be first?
Do notaries carry insurance? Where else would they come up with $1.5 million?
It was not recorded. It was never enforceable. And the "grantor" was probably added after the notarization. Grantees don't sign deeds. As for the word "two", unless you knew exactly what he was trying to do, you'd just brush it off as an innocent typo IF you even noticed it.
Tidy little sum extracted from a deep-pocketed corporate behemoth that really was on the periphery of the bad behavior. A lawyer or two will get a Bahamian vacation out of it.
i have followed this story from the outset. Baker Donelson was the only party who the receiver did not make a recovery.
I've been party to dozens of deed signings in my lifetime. I've never seen a notary witness a signature without the signee presenting identification. The notary log books have also made a big comeback. UPS definitely was in the wrong. Glad they got hammered.
It’s the one with deep pockets that gets sued not the one who’s guilty. If I were a bank or ups I would stop providing the service
When will they go after the upper level investors whose names were used to draw additional people into the scam. Have those funds bee recovered ?
Notaries Public are required to maintain surety bonds.
I’m curious has any of the clawback $ been given back to the investors yet or can that not happen until all money is received? Also, how is the money distributed? Is it done on a percentage basis or ? Just wondering.
If a UPS store can make $5 million dollars, i'm in the wrong line of work and need to quit and open a UPS store.
Thanks.
To 10:16 AM: LOL !!!! Bless your naive heart!
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