The Chapter 7 bankruptcy of a Basalt-based business long shut down, filed approximately eight years ago, has just been discharged, with almost $20 million creditors’ claims still unsatisfied, as reported in the Aspen Times.
Nineteen Aspen-Snowmass and Basalt area creditors were listed in the court records.
The books on the bankruptcy closed on April 27 with only $35,593 for administrative costs, associated with the bankruptcy only, showing as paid.
The business, Rare LLC, was a mail order wine company that focused on selling Bordeaux futures. It was run by Basalt resident R.W.
U.S. prosecutors claim that R.W. took money from his clients, from 1999 to 2003, to purchase wine futures that he failed to deliver – in most instances. Prosecutors further stated that the funds R.W. collected he instead spent on a BMW, his home remodel, a membership in the Roaring Fork Club and global flights.
R.W. was convicted and sentenced on February 12, 2007 on federal charges. The amount of money that he had stolen totaled $13 million.
He has been ordered to pay his clients at least $11 million as part of his sentencing.
The sentence also included five years of probation and two years of house arrest.
A failure in his probation by June 2010 resulted in further jail time – an additional nine months in prison and 27 months of supervised release.
R.W. had failed his parole by not paying restitution, not providing his probation office with both state and federal income tax returns, a failure to hold a job, failure to submit his monthly report forms and failing to report in with his probation officer.
Trustee Joseph G. Rosania had approved the bankruptcy. Rosania identified all of the creditors that Rare LLC owed, that had filed claims seeking to be paid from the Rare estate, and not one will be paid.
Two Guess? Inc. company founders, M.M. and P.M., made claims against Rare estate that were left unpaid. M.M. filed two claims – one for $1,468,545 and the second for $1,724,954.
P.M. also made two claims – for $378,118 and $750,891.
A third creditor listed, S.O., a former executive with Microsoft, had a claim over $1 million that was also not paid.
Other clients listed in the scam that will not be getting any of their money back include sports broadcaster, C.F. for $22,388, and a non-profit organization run by baseball pitcher, J.M., for $13,275.
According to bankruptcy records, Aspen businesses not seeing a payout include: Aspen-based attorney, John Beatty for $234,259, Aspen law firm Garfield & Hecht for $21,953, Labor Source for $12,845, Mountain Temp Services for $5,311, Grassroots Community Television for $500, and Pitkin County Clerk and Recorder’s Office for $686.
The original bankruptcy, a Chapter 11 protection, was filed on March 17, 2003.
On May 14, 2004, the bankruptcy was converted to a Chapter 7 liquidation.
Filing for a personal or business bankruptcy doesn’t have to result in jail time and unpaid creditors. Contact a bankruptcy attorney for assistance with your filing.