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Creditors hunt for fraud in bankruptcy

Oct. 16, 2012 at 5:08 PM   |   Comments

SANTA ANA, Calif., Oct. 16 (UPI) -- Creditors of a bankrupt California auto leasing company say they have hired a former FBI agent to learn where $13 million went before the business collapsed.

Bankruptcy trustee David Hahn said in court documents that former principal in Silver Oak Leasing, Mary Reafsnyder, wife of a grandson of amusement park pioneer Walter Knott, may have orchestrated a Ponzi scheme.

Reafsnyder has denied wrongdoing, The Orange County (Calif.) Register reported Tuesday.

Among those who say they have lost money in Silver Oak -- which specialized in leasing exotic and luxury automobiles -- is Reafsnyder's sister-in-law and Knott granddaughter Maureen Sloan, who claims she lost $10.5 million and is paying the $165-per-hour fee of fraud investigator and former FBI agent Gary Morley, the newspaper said.

Hahn said in court papers he wants Morley to track down Silver Oak's missing assets and determine whether the case should be recommended to a prosecutor.

Most fraud allegations in Southern California are handled as civil cases rather than criminal cases, the newspaper noted.

"I have no reason to believe the money is not there. It's just out of our reach," said Sloan.

Silver Oak had only $3,000 in a bank account when a bankruptcy trustee took over the company in March, court papers said.

Topics: David Hahn
© 2012 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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