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Indianapolis accounting firm settles with Fair Finance trustee

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Somerset CPAs P.C. will pay $500,000 to settle litigation brought by the bankruptcy trustee of Fair Finance Co., the Ohio-based firm convicted financier Tim Durham used to conduct a major Ponzi scheme.

Trustee Brian Bash alleged that Indianapolis-based Somerset received $760,454.90 in fraudulent transfers while working for Durham’s related companies. In a bankruptcy-court motion filed Wednesday, Bash said he was willing to accept the $500,000 to avoid expensive litigation over the complex case.

Somerset President Pat Early was traveling and unavailable for comment Thursday morning.

Bash’s claim involved dozens of transfers through 11 entities, including Fair Holdings, DC Investments and Obsidian Enterprises. In reality, Bash alleged, all of the payments to Somerset came from Fair Finance through a series of loan transactions. He alleged that Fair Finance had received no value for the fees because the related entities were insolvent.

Somerset disputed its liability and some of the factual allegations of the trustee’s claims, Bash noted. The firm admits no responsibility under the settlement.

The firm has already placed the $500,000 in a trust account for release upon the judge’s approval, it said.

Somerset is the seventh-largest accounting firm in the Indianapolis area with 56 CPAs, according to IBJ research.

Durham, the financial fraudster convicted in June, switched accounting firms in 2005 after he couldn’t get a clean audit. His former accounting firm, BGBC, told him it couldn’t issue an unqualified audit report for 2003 or 2004 because Fair’s “conduct indicated it was not being run for its own benefit.”

Somerset later accepted Fair as a client and issued a clean opinion for 2004. Early told IBJ that Durham provided “additional collateral he had not brought to the table when he was dealing with them.”

Somerset didn’t provide a clean opinion for 2005, and Durham dismissed the firm as his auditor.

In related news, Durham's attorney is protesting the proposed sentence recommended in the presentecing report that Durham spend around 225 years in prison and pay $209 million in restitution. Click here to read more.



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  1. From his recent appearance on WRTV to this story here, Frank is everywhere. Couldn't happen to a nicer guy, although he should stop using Eric Schnauffer for his 7th Circuit briefs. They're not THAT hard.

  2. They learn our language prior to coming here. My grandparents who came over on the boat, had to learn English and become familiarize with Americas customs and culture. They are in our land now, speak ENGLISH!!

  3. @ Rebecca D Fell, I am very sorry for your loss. I think it gives the family solace and a bit of closure to go to a road side memorial. Those that oppose them probably did not experience the loss of a child or a loved one.

  4. If it were your child that died maybe you'd be more understanding. Most of us don't have graves to visit. My son was killed on a state road and I will be putting up a memorial where he died. It gives us a sense of peace to be at the location he took his last breath. Some people should be more understanding of that.

  5. Can we please take notice of the connection between the declining state of families across the United States and the RISE OF CPS INVOLVEMENT??? They call themselves "advocates" for "children's rights", however, statistics show those children whom are taken from, even NEGLIGENT homes are LESS likely to become successful, independent adults!!! Not to mention the undeniable lack of respect and lack of responsibility of the children being raised today vs the way we were raised 20 years ago, when families still existed. I was born in 1981 and I didn't even ever hear the term "CPS", in fact, I didn't even know they existed until about ten years ago... Now our children have disagreements between friends and they actually THREATEN EACH OTHER WITH, "I'll call CPS" or "I'll have [my parent] (usually singular) call CPS"!!!! And the truth is, no parent is perfect and we all have flaws and make mistakes, but it is RIGHTFULLY OURS - BY THE CONSTITUTION OF THIS GREAT NATION - to be imperfect. Let's take a good look at what kind of parenting those that are stealing our children are doing, what kind of adults are they producing? WHAT ACTUALLY HAPPENS TO THE CHILDREN THAT HAVE BEEN RIPPED FROM THEIR FAMILY AND THAT CHILD'S SUCCESS - or otherwise - AS AN ADULT.....

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