Victims to get $736,000 from Petters accomplice

  • Article by: DAVID PHELPS , Star Tribune
  • Updated: December 5, 2012 - 11:34 PM

Receiver Doug Kelley recovered assets from Larry Reynolds' bank accounts, homes and luxury cars.

Larry Reynolds

Nearly $736,000 was distributed to the U.S. Justice Department from the estate of Larry Reynolds, a co-defendant in the Tom Petters Ponzi scheme, court documents showed Wednesday.

In a final report to U.S. District Judge Ann Montgomery, court-appointed receiver Doug Kelley said his office collected and liquidated slightly more than $2 million worth of personal assets held by Reynolds, including bank accounts, homes and luxury automobiles.

After expenses, fees and taxes, the amount available for the government to eventually distribute to Ponzi scheme victims was $735,983, the report said.

The Reynolds report is the first of six that Kelley eventually will file in the civil portion of the Petters case. Pending reports include those of co-defendants Deanna Coleman, Robert White, James Wehmhoff, Michael Catain and Petters himself. The six all had roles in the decade-long, $3.65 billion Ponzi scheme headed by Petters, in which money from investors who thought they were buying consumer electronic goods was used to pay earlier investors.

Petters was convicted for his role in the operation and is serving a 50-year prison sentence. The others pleaded guilty to various charges and are serving or have served shorter prison sentences.

David Phelps • 612-673-7269

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