Valley’s receiver cuts asset estimate
What remains of Valley Investments might not be worth even the $5 million that was estimated late last year, the receiver for the company told investors Wednesday.
After looking “with a hard, cold eye” at the assets of Valley Investments, especially at some of the aging and decaying mobile homes in the parks it operated, attorney Kirk Rider said he is starting to question his original estimate.
Valley Investments, 1445 N. Seventh St., collapsed last year. More than 400 investors lost about $31 million.
Rider spoke to 89 investors Wednesday in a conference call.
Owner Philip Rand Lochmiller Sr., his son, Philip Rand Lochmiller Jr., and an employee, Shawnee Carver, were indicted on multiple charges related to mail and securities fraud and are awaiting trial in federal court in Denver. Prosecutors have said they hope to have the trial conducted in Grand Junction.
The receivership has sought and asked law enforcement investigators whether there is any evidence that money was hidden offshore, “and there just isn’t any,” Rider said.
Valley Investments’ books showed the company paid about $11 million back to investors, Rider said. That effectively reduces the net value of the investors’ claims to the estate by one-third, or down to about $20 million, he said.
Of the company’s 421 investors, 366 filed claims to the receivership, he said.
Valley Investments asked investors to invest $20,000 to $40,000 in low-income housing projects in Colorado, Idaho and Utah. Investors were given what were purported to be first-trust deeds to lots on those properties. Investigators found that lots frequently were encumbered by many deeds.
Rider is planning to ask Denver District Court to approve his plan to liquidate all the assets and distribute the proceeds to all investors.
Some investors, however, have opposed that plan and have asserted their right to foreclose on their deeds. Some of the 55 investors who didn’t file claims with the receivership might oppose his proposal before the court, Rider said.
Rider said he is negotiating with the Lochmillers and family members to settle the receivership claims against their personal property, such as homes they own.
He also is dealing with 60 people or companies that have claimed Valley Investments owed them about $775,000, including a $770 massage-therapy bill, Rider said. The non-investor claims likely will cost about $450,000 to settle, he said.
He was unable to offer a date when he will be able to send out checks to investors, Rider told one investor during the call.
“I just don’t have a timeline for you. I’m sorry,” he said.
The receivership’s fees of about $220,000 were approved by the court, Rider said, but the estate does not have that much money yet. The receivership has yet to be paid for any of its work, Rider said, but should soon be able to pay itself and others, such as lawyers and accountants, about $100,000, he said.