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Lawsuit Filed Against Embattled Indy Businessman
Investors Seek $200M
POSTED: 4:34 pm EST December 4, 2009
UPDATED: 4:49 pm EST December 4, 2009
INDIANAPOLIS -- A prominent Indianapolis businessman whose companies are under investigation by the FBI is now the target of a $200 million lawsuit.The suit was filed in Summit County, Ohio, on Friday and seeks class-action status. It names Tim Durham and other executives and seeks to rescind $200 million in investor purchases of Fair Finance Co. securities.Images: Inside Durham's House
More: Have you done business with Tim Durham or his companies? Send Us An E-mailAttorneys with Maddox Hargett & Caruso of Fishers and David P. Meyer & Associates of Columbus allege that millions of dollars in insider loans were made to Durham and fellow Indianapolis businessman James Cochran, who used Fair Finance Co. "as their own personal bank.""The Ohio investors, many of whom are retired and on a fixed income, were tricked into buying these investments based on representations that Fair Finance was in the same line of business that it had been in since 1934," Meyer said. "The problem is that after Durham and Cochran bought Fair Finance in 2002, they drastically changed that business."The Indianapolis Business Journal reported that the suit appears to be the first investor lawsuit filed since the U.S. Attorney's Office alleged in court papers late last month that the business was operating as a Ponzi scheme, using the influx of money from new investors to pay off existing ones.The FBI on Nov. 24 executed search warrants and seized records at Durham's Indianapolis-based Obsidian Enterprises and at Fair Finance's headquarters.No criminal charges have been filed against Durham, and his attorney has said his client believes he has done nothing wrong.Indiana politicians have distanced themselves from Durham, who previously contributed heavily to primarily Republican campaigns.6News reported last week that Durham had contributed $280,000 to Gov. Mitch Daniels' campaigns and nearly $180,000 to Marion County Prosecutor Carl Brizzi.In 2007, 6News toured Durham's 30,000-square-foot-home near Geist Reservoir. The seven-bedroom mansion includes a private apartment, where the late Anna Nicole Smith once stayed during the Indianapolis 500, and a two-story garage housing an extensive classic car collection.
More: Have you done business with Tim Durham or his companies? Send Us An E-mailAttorneys with Maddox Hargett & Caruso of Fishers and David P. Meyer & Associates of Columbus allege that millions of dollars in insider loans were made to Durham and fellow Indianapolis businessman James Cochran, who used Fair Finance Co. "as their own personal bank.""The Ohio investors, many of whom are retired and on a fixed income, were tricked into buying these investments based on representations that Fair Finance was in the same line of business that it had been in since 1934," Meyer said. "The problem is that after Durham and Cochran bought Fair Finance in 2002, they drastically changed that business."The Indianapolis Business Journal reported that the suit appears to be the first investor lawsuit filed since the U.S. Attorney's Office alleged in court papers late last month that the business was operating as a Ponzi scheme, using the influx of money from new investors to pay off existing ones.The FBI on Nov. 24 executed search warrants and seized records at Durham's Indianapolis-based Obsidian Enterprises and at Fair Finance's headquarters.No criminal charges have been filed against Durham, and his attorney has said his client believes he has done nothing wrong.Indiana politicians have distanced themselves from Durham, who previously contributed heavily to primarily Republican campaigns.6News reported last week that Durham had contributed $280,000 to Gov. Mitch Daniels' campaigns and nearly $180,000 to Marion County Prosecutor Carl Brizzi.In 2007, 6News toured Durham's 30,000-square-foot-home near Geist Reservoir. The seven-bedroom mansion includes a private apartment, where the late Anna Nicole Smith once stayed during the Indianapolis 500, and a two-story garage housing an extensive classic car collection.
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