Saturday, September 19, 2009

Kelly G Rogers files Bankruptcy Part II

Kelly G Rogers Bankruptcy filing (Part I) was not surprise to those who know his mode of operation. It also came as no surprise that his wife, Carrie Rogers, was excluded from the Chapter 11 filing. By the way, click on any of these documents to see them in full size. 

Interesting. So the purpose of this Bankruptcy follow up story is to;

1. Raise inconsistencies discovered while comparing Mr. Rogers “summary of schedules” from his bankruptcy filing against the Personal Balance sheet provided to bankers in order to secure financing.

2. Identify specific assets that have totally disappeared or are significantly understated on the new summary.

3. Question how Kelly Rogers can lose millions of dollars of friends, business associates and Investors money, rack up massive debt, then create a cleaver strategy to free him of all responsibilities and simply live happily ever after on Carrie Rogers stated income of $45,000.

As we explore this information, I wonder how the people from Series C LP feel today about loaning both Kelly and Carrie Rogers $125,000 on February 2nd, 2009? Afterall, Kelly and Carrie Rogers signed their good name on the bottom line, promising to pay the $125,000 back on May 1st, 2009. It makes me wonder who owns this Series C LP company and why they didn't know the track record of lawsuits and investigations surrounding Kelly G Rogers when they loaned him the money back in February? Couldn't they have Googled his name and seen the lawsuit issued by the SEC? I wonder how they felt on July 9th when Kelly filed Chapter 11? Do you think they now question whether they should have made that loan for $125,000? I'll bet they were very surprised when the bankruptcy papers showed up at their office shortly after the filing!  Maybe if this blog had been up and running back in February, they could have saved themselves some hardship at the hands of Kelly and Carrie Rogers? Thus, the purpose of this truth.

Moving on, let's review some facts. In case number 71-198-Y-0001-07 and 71-198-Y-0001-08, Kelly Rogers’s “First Amended Cross-Claim against Co-Respondents, Page 3: “Since July, 2006 Richard Weyand has methodically committed acts of fraud against Kelly Rogers by illegally taking from Kelly Rogers his rightfully owned interests in many businesses. In July, 2006 Kelly Rogers and Defendant Weyand were partners in no fewer than 15 entities that were partnerships, LLC’s, corporations or Joint Ventures. Kelly Rogers obtained his ownership in these entities through either payment from his personal funds, interests derived from founding the companies and assisting in building the companies, providing his personal financial statement and personally guaranteeing the debts of the companies, and providing services And equipment to the certain companies”. So we can clearly establish that the purpose of the July 17th, 2006 balance sheet was to provide information to “Personally guarantee debts of the companies”. So let’s compare the this balance sheet and the stated assets listed on July 17th, 2006 to the assets listed on the chapter 11 filings in case number 09-42154.

First, let’s do some quick clean up on the bankruptcy filing. On the Summary of Schedules, Mr. Rogers has incorrectly added his numbers. He has understated the amount owed to unsecured creditors by $104,997. He stated a total of $4,300,863 to unsecured, non-priority creditors. So, if you’re keeping score at home, the total owed should read $6,563,852 rather than $6,458,794.

Here’s the list of assets and asset values that have disappeared from the B6 Summary document on his Chapter 11 filing;

    Asset description               B6 Summary   July 17th, 2006 B/S

1. Westin Kierland in Arizona-     $20,000    $     47,000
2. St. Regis Apartment                 Missing     $   515,000
3. Household furnishings               $30,000    $  360,000
4. Jewelry                                    $0             $  117,000
5. Mass Mutual/NWM                $0             $     36,500
6. Automobiles                            $8,600      $   180,000
7. Great Eastern Securitiies          Missing     $1,750,000
8. Activa Mutual Fund                 Missing     $       8,500
9. Federal Reserve Deposits        Missing     $   450,000
10. HR Block investment             Missing     $     27,500
11. Component        Missing     $   430,000
12. Demeter Systems, LLC         Missing      $1,150,000
13. Carbucks Carwash, LLC      Missing        $ 337,000
14. Discovery Resources             Missing    $21,000,000
                                                _____      ___________
                                                 $58,600    $26,408,500

To me, this is shocking. It begs the question; which set of numbers are correct, the numbers presented to banks from his July 17th, 2006 balance sheet when he was personally guarantee debt or the numbers in his bankruptcy report? On the other side of the coin, did the value of these assets drop form $26,408,500 to $58,600 or have they been transferred out of him name into third party and sheltered from bankruptcy? Our guess is this did not happen because on Exhibit D of the filing it specifically asks if any property has been transferred in the last two years and the answer is “None”.

However, one investor group who plunked down $1,200,000 for a Falcon Energy deal has filed a “Motion for rule 2004 Examination of Kelly Gordon Rogers”. Under this motion, it would allow the investors to dig through the assets of Rogers to find where the heck their money went. “Prior to the petition date, and upon information and belief, the debtor obtained possession of assets of the trust and currently has knowledge of where the trust assets or proceeds thereof are located”. This "deal" occurred in February of 2007 when Mr. Rogers was establishing his “Falcon Energy LLC” empire.

So, is it possible for one individual; to lose millions of dollars of other peoples money, add an 8,000 square foot addition to their home, place the home in a trust, rack up $6.5 million in debt, file Chapter 11 to release the debt to creditors, then walk away to live on his wife’s $45,000 per month income? Is that possible? Only time will tell.

In the meantime, the answers to these and other questions can only be determined by the Trustee who will sort through the maze of information. In the end, the truth will be uncovered.

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