Civil suit filed against businessman Durham
David MacAnally/Eyewitness News
Indianapolis - Indiana businessman and millionaire Tim Durham has more legal trouble. The court-appointed trustee of one of his failed companies is now accusing Durham of using an Ohio investment firm as his own piggy bank.
The lawsuit, which was filed in bankruptcy court in Cleveland is civil, not criminal, but Durham isn't out of the legal woods. Durham has denied any wrongdoing.
"What we did was completely legitimate and entirely legal," he said.
But now, the lawsuit filed by the trustee charges Durham ran Fair Financial "as a Ponzi scheme" and "looted every last penny" from the company. Durham is not charged with a crime, but Ponzi schemes are illegal and he is still under federal investigation.
Last summer, Durham handed over his vast car collection and house for sale to help repay investors. They are out about $200 million and many are retirees.
When the feds raided the Indianapolis offices of Durham's Obsidian Enterprises, they looked for any evidence of a Ponzi scheme.
The suit says when he bought Fair Financial, Durham claimed "this will be like taking candy from a baby." It alleged he "began looting Fair at a stupendous pace" with no hope of paying the company back.
He told Eyewitness News anchor Anne Marie Tiernon in an interview last fall he didn't consider himself as Indiana's Bernie Madoff. Despite claims in the suit of millions of Fair's money going to Durham and others as personal loans, Durham says nothing illegal happened. He blames the FBI raid and the media.
"It would be virtually impossible for many companies to survive that and, unfortunately, several of ours didn't," Durham said in the fall.
He says he feels "terrible" for Fair Financial's 5,000 investors.
"It's a terrible situation. Just terrible," he added.