Connecticut Park Foreclosure Case Thickens
A court-appointed co-manager of the Strawberry Park campground near Preston, Conn., is alleging that campground operator Hyman Biber admitted creating a limited liability company last year to avoid the claims of creditors and keep the business going, which Biber is denying, theday.com reported.
In a 26-page affidavit filed Wednesday (Nov. 17) with the Connecticut District of the U.S. Bankruptcy Court, James P. Tucciarone says that an August letter of commitment to refinance the property comes from Hard Rock Holdings Inc., of Ridgefield, N.Y., an entity that doesn't exist either in New York or Connecticut.
Tucciarone also states that Biber systematically overdrew bank balances by thousands of dollars – and, in one case, by as much as $185,914 – in a checking account at Chelsea Groton Bank in order to keep the business running.
Biber filed for bankruptcy on Oct. 21. A series of hearings related to the case are scheduled at 10 a.m. today in Room 715B of the federal bankruptcy court in Hartford.
"Mr. Biber admitted that he regularly had the company (Strawberry Park Resort LLC) issue and deliver checks for which funds were not currently available and then tried to either earn or borrow the funds to make them good," Tucciarone writes.
After obtaining records from Biber on Oct. 4, Tucciarone says he found two payments of $9,900 each to Alvin Parmassar, president of Hard Rock Holdings Inc., which Tucciarone suggests "can indicate an intent to avoid the $10,000 cash limit for reporting transactions in cash," a requirement of the IRS and the Bank Secrecy Act.
Reached by phone Wednesday, Biber said he adhered to whatever Tucciarone asked him to do "100%," and is constrained from saying much more because of the legal proceedings in federal and state courts.
"I will say I am aware of the things he alleged and they are not what they appear to be, and he's taken things and made them appear to be serious transgressions, and in point of fact, they simply are not," Biber said.
Biber's attorney, Carl Gulliver, said, "It may very well be that there are innocent and legitimate explanations for matters that are addressed by Mr. Tucciarone. It takes some time to investigate."
Tucciarone, who is based in Norwalk, was a partner in the accounting firm of Touche & Ross and an auditor and group manager for the IRS. He is now a trustee managing more than $2 million a year in commercial rents for several trusts that own real estate in Connecticut and elsewhere, according to the court request for a receiver.
After he was appointed Sept. 27, Tucciarone's discoveries led him to withdraw as co-manager of the park on Oct. 22. He said it was "impossible" for him to fulfill the court order to help manage the property without violating the Superior Court order to ensure tenants pay "all rents."
New London Superior Court Judge James J. Devine put Elite Resorts, a management company from Salt Springs, Fla., in charge of the property on Nov. 2. In that case, TD Bank won a Superior Court judgment of default for more than $8 million on a campground mortgage. A hearing for a sale by foreclosure is slated for Feb. 26.
Preston Strawberry Funding Associates, a defendant in the TD Bank foreclosure case that claims Biber owes it more than $3.4 million, asked the court to appoint Tucciarone as co-manager and receiver of rents in late June.
In that motion, attorney Mark Stern asserted that, as a sole member in multiple companies, Biber created "complex layers … in part to shield the property and its cash flow from foreclosure."
Stern also alleged that income generated from the property was being used for purposes other than paying creditors, and that Biber "is employing dilatory tactics," including filing for bankruptcy, as a way of blocking foreclosure "at all costs