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Mansion of Petters associate for sale; proceeds will be held

  • Article by: DAN BROWNING
  • Star Tribune
  • November 16, 2008 - 9:39 AM

Frank Vennes Jr., a Shorewood businessman who has been linked to an investment fraud scheme allegedly run by entrepreneur Tom Petters, got court approval Thursday to sell his Florida mansion for $5.8 million.

Vennes bought the 8,300-square-foot oceanfront home in Tequesta, on Florida's Atlantic coast north of Palm Beach, two years ago for $5.5 million. Built on a half-acre lot in 2005, it has four bedrooms, eight bathrooms and a guest house.

Vennes listed the property for $6.5 million. An appraiser put the value at $5.8 million.

U.S. District Judge Ann Montgomery approved the sale Thursday. After the home's two mortgages are paid off, net proceeds of $1,384,074 will be paid to the receiver overseeing Vennes' property pending the outcome of the investigation of Petters and his associates.

On Tuesday, Montgomery also approved the sale of a three-bedroom house Vennes had owned in Bismarck, N.D. He paid $160,000 for the 2,712-square-foot home in 2005, and it sold for $155,000. Net proceeds of $138,896 will be paid to the receiver.

Last month, Montgomery also authorized the sale of a golf club membership owned by Vennes. His attorney, James Volling of Faegre & Benson, put the value of the golf membership at about $80,000 and acknowledged that the proceeds would be subject to court control.

According to the government, Petters enticed investors into giving him money by telling them it would be used to buy merchandise that he would then resell for a substantial profit through big-box retail chains. The government says that the merchandise never existed, and that Petters used the money for other businesses, to make lulling payments to investors and for his lavish lifestyle.

Vennes, who has not been charged in the case, has told the FBI that he earned millions of dollars a year by referring investors to Petters.

Dan Browning • 612-673-4493

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