Brogdon gets partial repayment extension

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Christopher Brogdon received another partial extension of his court-monitored plan to repay investors he has been found liable of swindling in a sequence of bond deals, even as the officer overseeing that plan alleged another breach of cooperation.

The Atlanta-area financier’s court-administered monitorship plan will now extend until Sept. 13 for seven assisted living facilities Brogdon is trying to liquidate. It will terminate at the end of this month for all of the rest of his assets. This order, entered Tuesday by U.S. District Judge Kevin McNulty in a federal court in New Jersey, followed Brogdon’s June request to create a new repayment plan and the Securities and Exchange Commission’s subsequent opposition to giving Brogdon any further extensions.

Meanwhile an attorney for Florida-based CPA Soneet Kapilla, who is the court-appointed monitor of Brogdon’s efforts to repay more than $65 million owed to bond investors, filed a new letter to McNulty this week complaining that Brogdon had once again flouted the court’s orders.

The court found in 2015 that Brogdon was liable for fraudulently raising $168 million from 54 conduit municipal bond deals and $22 million from private placements over 25 years. He has repaid some $33 million to investors, but whether the court continues to keep some sort of monitorship in place or simply enters a judgment against him for the remainder, it appears unlikely investors will be made whole.

Kapila already complained about Brogdon’s conduct in an April letter to the court, indicating that he believed Brogdon and his wife were dragging their feet on the sales of several multi-million properties, including a luxury condo, a vacation home, and a Beechcraft King Air 300 airplane valued at $1.5 million.

In his latest missive, the monitor told the court that Brogdon appears to have directed one of his companies, Ban NH, to declare bankruptcy without seeking either Kapila’s or the court’s approval first, as required under the court order governing the monitorship plan. Ban NH was delinquent on more than $500,000 of taxes owed to the Internal Revenue Service and was apparently insolvent, according to Kapila’s letter, but Brogdon nonetheless transferred almost $300,000 from Ban NH to other entities under his control, Kapila wrote.

Brogdon’s lawyers have proposed that the Brogdons be allowed to submit an "amended or alternative plan" under the helm of a new monitor.

The SEC could choose to change its mind and continue to support the monitorship plan being extended beyond September, but has indicated in court filings that it has no reason to believe doing so would further benefit investors.

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