Bill McHenry received millions of dollars in “commissions” in exchange for his recruitment of new investors to Madison Timber.
The Receiver obtained a $3,473,320 judgment against McHenry on August 16, 2019, but he has not paid it.
On January 27, 2020, McHenry filed for bankruptcy. In addition to the $3,473,320 he owes the Receivership Estate, he represents that he owes the I.R.S. $706,761.93 and a handful of banks more than $684,000.
By filing his petition for bankruptcy, McHenry triggered an automatic stay of litigation against him. The automatic stay applies to all bankruptcy petitioners pursuant to 11 U.S.C. § 362.
The result is that the Receiver cannot collect the $3,473,320 judgment against McHenry while his bankruptcy proceedings are pending.
The Receiver, however, can and will participate in McHenry’s bankruptcy proceedings in order to assert the Receivership Estate’s rights. The Receiver will post meaningful developments below.
Timeline of proceedings against McHenry:
October 1, 2018
The Receiver filed a complaint against McHenry to recover for the Receivership Estate “commissions” paid to him by Lamar Adams or Madison Timber.
January 25, 2019
A federal grand jury indicted McHenry for securities and wire fraud.
August 16, 2019
The Receiver obtained a final judgment against McHenry in the amount of $3,473,320. For that ruling, click here.
December 2, 2019
The criminal trial of McHenry commenced. It concluded with an acquittal on December 5, 2019. For the Receiver’s letter regarding the verdict, click here.
The Receiver did not examine McHenry regarding his assets while criminal proceedings were pending because he would have invoked his right to silence.
December 12, 2019
The Receiver moved the court for an entry of an order permitting her to examine McHenry under oath in open court regarding his ability to pay the $3,473,320 judgment against him.
January 7, 2020
The court ordered McHenry to appear for examination on February 10, 2020, and to produce documents relevant to his finances to the Receiver on or before January 27, 2020. Read the court’s order here.
January 27, 2020
Rather than produce documents as required by the court’s order, McHenry filed for bankruptcy under Chapter 7 of the United States Bankruptcy Code.
February 6, 2020
Because McHenry filed for bankruptcy, the court postponed indefinitely the examination that had been set for February 10, 2020.