The tony Lafayette Country Club has agreed to return nearly $4,000 it received from bankrupt auto dealer Denny Hecker last summer.
Hecker is accused of illegally siphoning those and other funds from insurance policies last summer, and bankruptcy trustee Randy Seaver has demanded the funds back.
In a notice to the court Monday, Seaver said the "Lafayette agreed to repay the amount of $3,732.92 in full satisfaction of the trustee's demand. The trustee believes the settlement is reasonable and in the best interest of the estate."
The court learned last summer that Hecker illegally cashed or borrowed $154,000 from Prudential insurance policies and then rushed to spend most of it. He paid the Lafayette Club $4,750 in money orders in an attempt to clear an overdue account.
The Minnetonka Beach country club returned $1,017 to Hecker, noting that he overpaid. Now it's agreed to part with the rest.
Court records show that Hecker, who filed for bankruptcy last year claiming $767 million in debt, went on a wild spending spree after getting access to the insurance funds. He did not inform either the bankruptcy court or the criminal court, as he was required to do, and ultimately was sent to jail in October for failing to give the court a full accounting.
Seaver has demanded all of the wrongly spent money be returned to the bankruptcy estate for liquidation to creditors. Hecker told a judge in October that he owed the Lafayette Club money and that the owners were longtime friends he couldn't let down.
Hecker, who faces up to 10 years in prison for bankruptcy fraud and defrauding Chrysler Financial of $13.8 million, will be sentenced early next year.
