Judge Moves to Seize Okun Assets: Confiscated Assets Will Be Liquidated for 1031 Tax Group Settlement

U.S. Bankruptcy Court judge Martin Glenn recently ordered the seizure of assets from 1031 Tax Group owner Ed Okun as the next step in attempting to pay back monies owed to investors aka creditors. According to the Associated Press, this agreement allows the 1031 Tax Group to seize control of it’s owner’s (Okun) assets for liquidation to meet debts outlined in the settlement. Judge Glenn was quoted as saying “This agreement immediately results in the debtor’s recovering assets that can support a liquidation plan and distribution to creditors.”

In the original settlement, creditors rejected the deal because that deal would have allowed Ed Okun to keep ” his four houses, four airplanes, seven boats and 20 cars” The assumption, and nobody from Okun’s camp has chosen to prove otherwise, is that these assets were purchased with creditor’s monies. The old “other people’s money” strategy of investing.

The list of assets seized: a helicopter, Learjet, and two Gulfstream jets. In addition 7 boats will be taken amongst them are a 38ft Cigarette go-fast boat and a 37ft Heim wooden replica vessel. Even more impressive are the cars an incredible collection beginning with two Indy race cars, two Ferraris, two Lamborghinis, a Bentley, and a Rolls.

Although this is a good beginning to recovery, what is puzzling is the fact that the judge is taking all of Okun’s assets away. . . or is he? In the deal, according to Associated Press reports, the judge specified, that “Mr. Okun would be allowed to keep two multimillion dollar homes in New Hampshire and Florida and two cars. Okun will also be able to negotiate a living allowance.”

Granted it is very possible that the two multi-million dollar houses and two cars were assets earned prior to his maneuvers with the 1031 Tax Group. Unfortunately that is not much consolation to people who have lost absolutely every dime they owned in this deal. For those investors, their retirement days will be filled with work trying to rebuild from scratch. Hopefully everyone will be able to walk away with something including Mr. Okun.

JPS Answers the Bell: Finally Some Good News For Okun Investors, A Lesson for deansguide

Like a bolt out of the blue skies, I received an email that is good news for the investors in the 1031 Tax Group case. I made a mistake and was hasty in reporting that JPS Capital had removed themselves from the 1031 Tax Group settlement. How do I know that I had my facts wrong? The following was sent to me by Mr. Joel Shapiro, principal, of JPS Capital Partners LLC.

Before I continue I must say that I am honored that Mr. Shapiro or anyone of his stature is spending time to read this tiny blog of mine. Back to business, Mr. Shapiro’s comment on my Oct 26 article “1031 Tax Group Reorganization Plans Stymied: West Oaks Mall Files For Bankruptcy Protection Leaving Investors Reeling” is much welcome news for those people who have suffered through this ordeal.

Thank you Mr. Shapiro for stepping to the plate to help these people. Thank you for giving us the correct information and I hope that this information is circulated throughout the investor community. Here is Mr. Shapiro’s correction of my initial impression:

“Having read your October 26, 2007 article on the 1031 Tax Group Reorganization, we want to contact you to correct any misimpression that you have with respect to JPS Capital Partners role in this transaction. We would ask that you update your story to reflect the statement below:

“JPS issued a $300 million Term Sheet to Edward Okun on June 20, 2007 based upon representations made by Mr. Okun as to the value of his assets. After performing due diligence it became apparent that the values represented to JPS could not be verified. Based on the values that we were able to verify, JPS issued a commitment to Okun for $148,625,000 on October 8, 2007. This commitment provided Okun, and by extension the creditors, with $20 million at closing and with the ability to receive up to an additional $125 million over the ensuing 24 months, through profit participation as the assets are liquidated.

This is a plan designed to maximize value for the Estate and its creditors, given the values of the underlying collateral.”

Joel G. Shapiro
Principal
JPS Capital Partners LLC
200 West 57 Street
Suite 303
New York NY 10019
212-790-6714

deansguide’s ‘Big Break’ on The Nightly News HarperTeam JibJab.com Style

You prepare yourself for the unthinkable, practice your public speaking, polish your prose, and maybe just maybe a major media source picks you up. A program director, “booker”, talent scout, or editor decides that your writing isn’t half bad. They hem and haw over the childish nature of some of your efforts but the big Kahuna decides that you are worthy.

Your phone rings, or your email sings, or your ears burn but in any one of these cases you are contacted with the sweet news-your blog is being picked up. You are about to live your 15 minutes and it is your shot at the big time, the “show” as Kevin Costner liked to slobber in “Field of Dreams” yes you are on the precipiss. YOU ARE BEING FEATURED ON JOHN HARPER’S FRIDAY NIGHTLY NEWS at theharperteam.com.

You quickly click over and there it is in bold writing:

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Most interesting yet was the wonderful write up John and his team bestowed upon me. Little did I suspect that I was about to make my “Dancing Without Any Stars” Carmen Miranda debut. For a real laugh, it hurts to watch, check this out courtesy of jibjab:

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Go to the following link to see my routine at www.theharperteam.com. The rest as they like to say is history. For more information on how you can set up ah I mean help a friend out go to www.jibjab.com.

My next post will feature this cool tool from jibjab.com. Until then I got to get to the studio and practice!

1031 Tax Group Reorganization Plans Stymied: West Oaks Mall Files for Bankruptcy Protection Leaving Investors Reeling

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A Houston, Texas super mall has just filed for bankruptcy protection in order to guard against foreclosure proceedings. The “rest of the story” as the great Paul Harvey used to say, is that the West Oaks Mall, a 1.1 million sq ft complex, was the centerpiece of Edward Okun’s assets that are now under attack by investors seeking to recover their lost monies in the 1031 Tax Group mess.

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Mark Heschmeyer of CoStar Group wrote a fantastic probe, in his ongoing investigative series, on the current state of the 1031 Tax Group-Ed Okun proceedings. Heschmeyer’s article “Mall Bankruptcy Complicates 1031 Investors’ Problems” provides a grim picture of the domino effect of the West Oak Mall bankruptcy filing.

The results of this filing is that one of the largest assets “owned” by the 1031 Tax Group, that investors pinned their hopes on liquidating to recover their lost monies, is now deemed untouchable.

The following paragraph “strike through” is the result of new information provided by JPS Capital Partners LLC principle Joel Shapiro. Mr. Shapiro’s information is featured in my Oct 29 article “JPS Answers the Bell: Finally Some Good News for Okun Investors, A Lesson for deansguide.” Please disregard my misimpressions in the strike through paragraph below For the correct information reference “JPS Answers the Bell: Finally Some Good News for Okun Investors, A Lesson for deansguide.”

According to CoStar sources, JPS, the investment firm providing the loan to Okun in order to complete the reorganization deal and repay investors, has made the decision to back out of the deal altogether. These same sources claim that JPS’s decision was made prior to any knowledge of the West Oaks Mall bankruptcy filing.

These turn of events have left the proceedings up in the air, the 1031 Tax Group scrambling for a new plan, and poor investors livid and frustrated.

Swampalot’s “West Oaks Mall: Your Exchanges are No Good Here” piece provides a beautiful picture of West Oaks Mall as well as a nice accompanying article.

As one investor interviewed for Heschmeyer’s story related: “Okun’s toys and assets are continuing to get diluted.” The sad fact of these developments are that investors will most likely see fewer and fewer dollars coming back to them in their settlement.

1031 Tax Group Case Spinning Out of Control: Assets Are Evaporating While Investors Are Searching For Answers

It just continues to slowly erode the confidence and hopes that investors have harbored since the day the 1031 Tax Group owned by Ed Okun first declared the money was “missing.” The “It” I speak of is the proposition that investors were going to get their money back. CoStar Group’s Mark Heschmeyer wrote an eye opening article on the current state of the Ed Okun trial: Investors Still Ensnared In 1031 Exchange Collapses.

In the latter part of August, the 1031 Tax Group presented a plan for reorganization; the plan was to be reviewed in bankruptcy court this month. According to Heschmeyer the plan proposed that “340 unsecured creditors” would receive $142 million; the money was to come from a loan made to Okun by JPS Partners.

Okun’s collateral for these loans, according to Heschmeyer, was the following laundry list:

1. 13 Investment properties estimated worth of $162.5 million and personal residences that total another $19.5 million.

2. 20 cars which included 4 Indy race cars, Rolls Royces, Lamborginis and other exotic rides.

This collateral and JPS plan sounds like it would take care of the investors problems. Unfortunately that has not been the case. In past bankruptcy case history, the US Trustee appoints a small committee of unsecured creditors to represent the other unsecured creditors (victims) in the case.

When the 1031 Tax Group unveiled it’s plans for reorganization, 3 of the 12 appointed unsecured creditors in the committee resigned. Of those 3 who resigned, two have sold their rights to any potential recovery to an investment firm for a substantially reduced settlement. They took whatever money they could and ran.

Heschmeyer asserts that under the first plan of reorganization with JPS, investors would receive “75% to 84% of their investment” back.

1031 Tax Group has a back up plan in place if the JPS plan does not go through. (It is not looking as if JPS will go through with this deal at the time of this article.) This mere fact caused much of the sell off by unsecured creditors of their settlement rights to investment companies. It also had the investment companies, looking at bailing the 1031 Tax Group out, refusing to take on this deal.

Heschmeyer states that “under the backup plan, they (unsecured creditors) would get only 52% to 66%.” This plan would rely upon Okun to fulfill his obligation by selling off his assets. This is not a very likely scenario.

Even worse yet is the last alternative: liquidate all of the 1031 exchanges. Under this scenario unsecured creditors would be left with the crumbs of a 9 or 10 cents per dollar settlement.

The newest development that has come to light could spell the end of JPS’s involvement in the case altogether. Stay tuned for the next article in this long series, as I describe how one of 1031 Tax Group’s most valuable commercial property assets is in jeopardy.

National Association of Women Business Owners: The Greatest Networking Event and Association in the San Francisco Bay Area

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Over the course of the last 4 years I have attended hundreds of networking events, business mixers, and marketing breakfasts aimed at meeting real esate professionals and brokers. I have traveled around the Bay Area from San Jose to San Francisco and eastward from Walnut Creek to Livermore in search of networking opportunities. I have seen it all and done almost everything to raise the awareness of like minded professionals in regards to my consulting business.

Yet I believe I have found what is easily one of the most effective, action oriented, and professional networking events right in my backyard, Marin County. The event is a breakfast sponsored by the National Association of Women Business Owners held in Corte Madera’s Town Center at Illfornaio restaurant. The meetings begin promptly at 7:30am and run a full 90 minutes. The Marin breakfast meeting is once per month on Tuesday with the San Francisco breakfast meeting being held once per month on a Wednesday. What makes the NAWBO such a rich environment of networking information, business connections, and referral system?

This group is collaborative, goal oriented, and willing to share information and resources with group members. The very nature of these people is to help one another, without worry of compensation, reach their business goals. This is NOT set up like a BNI revival meeting where members are pressured into producing referrals, given very little valuable time to address the group, and often times never fully integrated into the group dynamic due to any number selfish obstacles.

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Instead NAWBO meetings begin with an agenda. The agenda is then facilitated by a leader. Each attendee receives 2-4 minutes to express themselves during a “Needs and Leads” exercise. This portion of the meeting is worth it’s weight in gold for the following reasons:

First, members are allowed to tell their business story and elaborate beyond the 30 second elevator pitch.

Second, it provides a forum to relate a business owner’s perfect lead or need.

Third, it provides public speaking practice and the hones the ability to think on your feet.

The final portion of the meeting is dedicated to one member’s presentation of their business. Each speaker is given 10-15 minutes to relate their information with a solid Q & A session at conclusion.

The NAWBO offers both dinner and breakfast meetings. In addition, “Brown Bag” luncheon seminars with speakers provide more education opportunities from “experts” in a diverse number of fields.

In today’s meeting, October 23, I met the following business owners:

1. Michelle Lerman Partner with Lerman Law Partners, LLP. Michelle is an award winning lawyer concentrating on Estate Planning, Trust, and Probate law.

2. Jennifer Baum Managing Director of Peridot Productions specializing in project management and getting the job done right. Jennifer has one of the fastest growing new small businesses in the East Bay.

3. Joan Jovan President, JJovan Insurance Services, Inc. is a comprehensive financial services firm. Joan is dynamic and well versed in her field.

4. Judith Stark Owner Judith Stark Consulting. Judith specializes in IT solutions with one of her main concentrations in solutions for small business IT challenges.

5. Kelly McKae of Women’s initiative. Kelly facilitates programs that help “high potential low income” women achieve the dream of business ownership. This is a very worthwhile non profit that needs our help.

6. Vida Harband, Esq of Advanced General Counsel. Vida specializes in part time in-house general counsel.

7. Linda Hammond of Bay Area Move Management. Linda provides moving services that specialize in helping Seniors and Boomers with downsizing and moving. A very valuable service.

8. Vijaya Jhothi of Safronya retreat. Vijaya is the owner and provider of one of the most spiritual complete “wellness” day spas I have ever encountered. Safronya’s focus is on Ayurveda is the 5,000 year old Science of Life originated in India. This is truly an amazing place!

Our meeting today included 15 members and guests. I met with eight and I knew most of the rest after only one meeting. This breakfast is truly an amazing source of energy and authentic collaborative efforts. I love it!

One of the Best Internet Guides for Realtors: “Rule the Web–How To Do Anything And Everything On The Internet-Better, Faster, Easier”

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This past summer’s Inman Blogger’s Connect conference in beautiful San Francisco was a huge success for many reasons. One of the best sources of information came as a gift from Brad Inman at the end of the conference. The gift was Mark Frauenfelder’s , founder of boingboing, book “Rule the Web: How To Do Anything And Everything On The Internet-Better, Faster, Easier.” This book is a veritable treasure chest of information, tips, and strategies to help any Realtor understand and utilize the web successfully. At $14.95, with 392 jammed packed pages of information, it is easily the most valuable document, for the least amount of money any Realtor can buy.

The following is a short overview of just a few of the topics covered:

1. Creating and Sharing: Blogs, Wikis, Social Networking, Video and more.

2. How to search and browse on Google: Many of the tips are very useful. An example “How Can I Find Someone’s Phone Number Even If It’s Unlisted? The answer according to Mark can be found at http://www.zabasearch.com.

3. Wireless Computing with valuable information for staying connected during travel, cell phones and other devices.

4. Tips are a big part of the Value of this book. Mark devotes an entire section to Tips from top notch bloggers. This information alone is worth the price of the book.

5. How to use translation software to convert your pages to another language. This is a burgeoning area in diverse areas such as the San Francisco Bay Area. Realtors willing to embrace translation of their web site or blog site into other foreign languages often find a very enthusiastic audience that is under serviced and eager to learn more information not available to them.

6. Podcasting is rich with information. Tips covered are what is a Podcast, how to listen to them, how to record a Podcast and how to broadcast a “live” podcast so that people can actually call into the podcast show!

This is just a brief description of the richness and importance of information contained in this book. The best part about the book is that it is very approachable for the non-technology person. Frauenfelder makes sense of the mundane, demystifies the mystical, and gives the reader plenty of examples of the value of his tips.