Turner Grain bank data subpoenaed
The trustee in the Turner Grain Merchandising bankruptcy case has subpoenaed records relating to more than $6 million in checks and withdrawals from two bank accounts belonging to Turner.
The subpoena was filed Tuesday for records held by Merchants and Planters Bank of Clarendon.
Baxter Sharp, the bank’s attorney, said Wednesday that he could not comment on the matter.
Turner Grain Merchandising Inc. of Brinkley filed for bankruptcy in October 2014, listing liabilities of $24.8 million and assets of $13.8 million. The failure cost farmers who did business with the grain dealer tens of millions of dollars, and a flurry of lawsuits were filed against Turner in state and federal court seeking to recover payment for grain delivered to the company. Most of those suits are now part of the bankruptcy case, which was converted to a Chapter 7 liquidation in May.
In August, U.S. Bankruptcy Judge Phyllis Jones approved a request by trustee Richard Cox to hire Lain, Faulkner and Co., a Dallas bankruptcy accounting firm that performs forensic audits among other services. Cox did not return a phone call Wednesday.
The subpoena is for all documents and information requested in an exhibit prepared by Lain, Faulkner. The exhibit asks for a “legible copy of check image or documentation supporting beneficiary of payment” for 17 transactions between May 15, 2014, and July 29, 2014. The transaction amounts range from about $2.4 million to $11,933. Three transactions are marked “withdrawal” and are in the amounts of $600,000, $250,000 and $45,000. The grand total for all 17 transactions listed in the exhibit is $6,027,082.
The two bank accounts in the exhibit are listed in the Statement of Financial Affairs
filed as part of Turner Grain Merchandising’s initial bankruptcy petition by the receiver, Kevin Keech.
The Statement of Financial Affairs says the accounts were closed on Aug. 1, 2014, and Aug. 4, 2014. The U.S.
Department of Agriculture shut down a grain elevator run by Turner on Aug. 14, 2014, after finding there was no grain stored there despite certificates saying otherwise. Turner’s creditors began suing the company soon after.
One of those lawsuits was filed in state court by Southern Rice and Cotton LLC of Harrisburg, which says it started
selling rice to Turner in the fall of 2013.
The Southern Rice suit was one of those that was made part of the federal bankruptcy case. On Monday, its attorney, Lyndsey Dilks, asked Jones to send the case back to Circuit Court in Poinsett County. Southern Rice contends that another entity, KBX Inc., “was intricately involved with Turner Grain”
and failed to pay Southern for rice it received.
Southern Rice’s complaint says that Turner wrote a check for the rice in July 2014 that was rejected by Merchants and Planters Bank for insufficient funds. Turner later paid Southern Rice part of what it owed but has since refused to pay the balance, according to the lawsuit.