Once again, friends with deep pockets jumped in to help bankrupt auto dealer Denny Hecker, this time preventing the contents of his home from being seized and sold at auction.
In a last-minute deal, unidentified donors came up with $15,000 Wednesday to pay the trustee in Hecker's bankruptcy, avoiding an unpleasant scene at the Medina home.
The trustee's attorney, Matthew Burton, stood ready with a court order to call in a moving van and U.S. marshals if necessary to remove property so that it could be sold at auction.
Hecker's criminal defense attorney Brian Toder said, "It's a done deal."
Burton confirmed that Toder turned over $15,000, though the source of the money will be investigated and the deal still requires court approval. For now, Burton said, it's enough to "call off the dogs as to obtaining the property."
U.S. Bankruptcy Judge Robert Kressel on Monday authorized using federal marshals after several attempts to get into Hecker's home were blocked by his girlfriend Christi Rowan. She was ordered in February to surrender $425,000 in gifts she got from Hecker, but hadn't turned over everything. She and her children share the $1.9 million house with Hecker.
Rowan pleaded guilty to bankruptcy and bank fraud Tuesday and agreed to cooperate in the federal investigation of Hecker. The plea agreement suggests Rowan could face about six months in prison and up to five years' probation for lying under oath in bankruptcy court and submitting a false W-2 tax form and lying about her income while applying for an auto loan when she purchasing a Land Rover for Hecker. She remains free on unsecured bond, but she had to give up her passport and not leave the state.
Hecker faces 25 federal charges, including bankruptcy fraud, mail fraud and conspiracy. The government alleges that he submitted fraudulent loan papers to Chrysler Financial and other lenders. Hecker has pleaded not guilty. He recently gave up his bankruptcy case, leaving him responsible for $400 million in debts.
Hecker says he has no money, but has been accused by the bankruptcy trustee of hiding assets. Hecker still must turn over Toyota and Jeep trucks discovered in Aspen, Colo., a commercial leaf blower and several watches, Burton said.
Burton said he must verify the existence of the donors who rescued Hecker's house belongings from seizure. Last month, Burton discovered that a $75,000 donation supposedly from Hecker's friend Ralph Thomas had actually came from trust funds for Hecker's children and grandchildren.
Burton did not reveal the names of Hecker's latest donors. Toder told reporters he will ask the judge not to allow disclosure of the donors' names to protect their privacy. These are "good friends of Denny's. They don't want any notoriety," he said.
A similar request not to release a donor's name is pending in Hecker's divorce case in Hennepin County District Court. That donor gave Hecker $125,000 to replenish a 401(k) plan he raided without the permission of his now ex-wife Tamitha Hecker. The Star Tribune has filed a motion in that case urging the court not to seal the information.
Kressel gave Burton permission to question Hecker's friend Nita Singh Johnson of Wayzata about how much money she gave him after he filed for bankruptcy in June. It's not known whether she was the source of the $125,000. Johnson could not be reached to comment.
The judge also ruled that Hecker's former employee James Gustafson can be questioned. Gustafson has challenged the subpoena, saying it would violate his Fifth Amendment right against self-incrimination. Gustafson hasn't been charged, but is under federal investigation. The bankruptcy trustee has said Gustafson helped Hecker hide money from the court and raid the Hecker family trust funds.
Attorneys' exit approved
In another ruling, Kressel allowed Hecker's former bankruptcy attorneys Clint Cutler and Bill Skolnick to quit. Skolnick has been questioned by Burton about the money taken from the trust funds. When handing over the $75,000 check in exchange for the deed to Hecker's home, Skolnick wrote Thomas' name on the memo line, leading the trustee to believe that he was the donor. Skolnick told the Star Tribune that he simply told the trustee what he had been told about the source of the money.
Kressel also approved a settlement giving Wells Fargo a $675,000 lien on Hecker's Baja California condominium. Wells Fargo will pay the bankruptcy estate $125,000 once the condo is sold. It is estimated to be worth between $1 million and $1.25 million, said Burton's co-counsel Jim Jorissen.
Dee DePass • 612-673-7725