Bankruptcy trustee lowers boom on a Hecker holding company

In an unusual move, the bankruptcy trustee handling the personal bankruptcy of fallen auto dealer Denny Hecker put one of Hecker's holding companies into bankruptcy Thursday and noted that Chrysler Financial is the legitimate creditor, not a bank in North Dakota.

The filing listed Jacob Holdings of Stillwater LLC (JHS) as having $1.8 million in assets and $262.7 million in liabilities that it said were all owed to Chrysler Financial, the chief creditor in Hecker's 2009 personal bankruptcy case.

Trustee Randy Seaver alleged in Thursday's filing that Cornerstone Bank in Fargo, N.D., had unfairly obtained the JHS deed from Hecker and that its claim for the property would be "disputed."

Hecker's Jacob Holdings of Stillwater LLC is commercial property in Forest Lake that is tucked behind several dealerships just off Interstate 35.

In filing the bankruptcy for Seaver, attorney Matthew Burton said: "Technically Cornerstone Bank is not a creditor. They never lent money to this entity." Instead, Hecker, who turns 58 Sunday, used the property to guarantee various fleet financing loans he had with Chrysler Financial. Those loans are all in default.

Burton said the court would most likely appoint a different trustee to handle the new bankruptcy filing soon.

The filing surprised attorney Barbara May, who is representing Hecker in his bankruptcy.

Hecker filed for personal bankruptcy one year ago, listing $767 million in total liabilities owed to Chrysler Financial and scores of other creditors. In that filing, Hecker described Jacob Holdings of Stillwater as a parcel of land at 22552 Everton Av. N. in Forest Lake and noted that he had forfeited the deed in lieu of foreclosure.

In the same 2009 filing, Cornerstone, the North Dakota bank, is separately listed as having an unspecified security interest in promissory notes worth about $4.75 million.

Hecker, who once owned Advantage Rent a Car, 26 new and used car dealerships and dozens of limited liability companies, has since given up his battle in bankruptcy court. He has been accused in federal criminal court of 25 charges of bankruptcy and wire fraud, conspiracy and money laundering. Hecker has pleaded not guilty.