Fraud Identification Training Sept-Oct 2022

The indictment alleges the Gillums defrauded Almena State Bank in Almena; Landmark Bank in Manhattan; Colorado East Bank and Trust in Lamar, Colo.; Astra Bank in Scandia; TBK Bank in Dallas; Guaranty State Bank in Beloit; and The Bank in Oberlin.

Dozens of cattle producers were caught up in the scheme after money that was supposed to be set aside to pay cattle sellers was transferred from a custodial account to the Plainville Livestock Auction’s operating account. The Almena Bank froze both accounts, which resulted in bounced checks amounting to tens of thousands of dollars per producer. Almena Bank filed an interpleader case, which is legal action that seeks to determine to whom the money that was transferred out of the custodial account belongs. In the interpleader case, Almena bank indicated Plainville Livestock Commission had defaulted on three loans with its bank totaling more than $3.49 million.

The interpleader case has been transferred from Norton District Court to federal bankruptcy court. That case is pending separate from the main bankruptcy proceedings and is still working its way through the court system.

According to court documents filed May 31 in federal bankruptcy court, the trustee indicated Almena State Bank has the first lien on the real property to be sold at the upcoming auction and the second lien on the equipment.

The property consists of two tracts, one of which is 21 acres and the other 0.65 acres. The property is valued at $734,030, according to the Rooks County Appraiser’s office.

The trustee determined TBK Bank has first lien on the equipment. According to court records, TBK Bank is owed $227,238.

The attorney for TBK did not wish to comment on the bankruptcy or the pending auction, Almena Bank did not return previous calls regarding this story.

There are also secured loans on four trucks and a skid loader. The creditors that hold those liens will be paid first on the sale of those items. The claim on these items amount to more than $92,000.

The machinery, equipment, vehicles and office equipment were valued at about $542,000 with cash, equivalents and accounts receivable worth an additional $211,000 according to court records.

According to court documents, Plainville Livestock Commission debt is almost $14.5 million of which $3.7 million is secured debt. Landmark Bank of Manhattan is listed as an unsecured creditor with the commission owing $8 million.