Securities and Exchange Commission v. Nadel et al

Filing 1289

STATUS report Receiver's Twenty-First Interim Report by Burton W. Wiand. (Attachments: # 1 Exhibit A - Standardized Fund Accounting Report, # 2 Exhibit B - Receivership Assets Sold or Otherwise Disposed, # 3 Exhibit C - Chris Moody's Assets, # 4 Exhibit D - Neil Moody's Assets)(Lamont, Michael)

EXHIBIT B

Receivership Assets Sold or Otherwise Disposed

Asset

Description of Asset

Disposition

Loans/Liens

Amount
Received
Waived

Real Property Business Operations
Venice Jet Center, LLC
("VJC")

The VJC was a fully operating
fixed-based operator that
included a flight school,fueling
service, hangar rentals, and a
café.

599 North Lime Avenue, A building owned by Lime
Avenue Enterprises, LLC which
Sarasota, Florida
housed a flower shop owned by
A Victorian Garden Florist, LLC

$1,960,169
loan from
Northern Trust

On January 20, 2010,the Court approved the sale of the VJC's $540,780.88 plus
elimination of
assets and an agreement with Northern Trust(Doc. 321). In
over
pertinent part, VJC's assets were sold to Tristate Aviation
approximately
for(1)$300,000 cash at closing;(2)a
Group of Florida LLC
$1,960,169 in
$250,000 unsecured promissory note payable over a term of
debt
three years;(3) resolution of a $1,960,169 loan with Northern
Trust; and (4)assumption of prosecution of the Part 16
Complaint subject to an offset of the note obligations to the
Receiver for up to $50,000 for expenses and costs actually
incurred in connection with efforts to resolve all disputes with
the City of Venice, including the Part 16 Complaint.

A mortgage owed
to Ron Carter and
James Neal with a
remaining
balance of
approx. $600,000

On May 26, 2011,the Court approved the conveyance of this
building and the remaining assets of the florist to Messrs.
Carter and Neil in exchange for the elimimation of over
$600,000 in debt and a claim of over $1,160,000 against the
Receivership estate(Doc. 633).

Page 1 of 14

Elimination of
over $600,000 in
debt obligations
and a claim of
over $1,160,000

Receivership Assets Sold or Otherwise Disposed

Asset

Description of Asset

Loans/Liens

Disposition

Amount
Received
Waived

On January 6, 2010,the Court granted the Receiver's motion $109,128.75 plus
elimination of
to sell certain of Home Front Homes' assets and approve an
over $3,000,000
agreement with M&I Bank (Doc. 293). In salient part,(1)
in debt
South American Development Corporation agreed to
purchase certain assets for $250,000, with $150,000 to be
paid at closing and a zero interest promissory note secured by
the assets due December 18, 2010 for the $100,000 balance
and (2) M&I agreed to waive over $3,000,000 in debt
obligations and forego any deficiency claims against the
Receivership estate in exchange for 65% of the cash and note
proceeds after $12,000 has first been paid to the Receiver for
expenses incurred.

Home Front Homes, LLC

Home Front Homes was engaged Loan from M&I
in the business of manufacturing, Bank for approx.
marketing, and selling energy$3,000,000
efficient homes.

512 Paul Morris Drive,
Englewood, Florida

On March 10, 2010,the Court approved the conveyance of
A building owned by Home Front Loan from
Regions Bank for this building to William Bishop in exchange for the release of
Homes on Lot 81 of the Morris
approx.$80,000 all claims against the Receivership estate(Doc 355).
Industrial Park
and loan from
William Bishop
with a balance of
approx.$700,000

200 Grandview Trail,
Thomasville, Georgia

Approximately 14 acres which
encompassed 45 lots, 44 of
which were undeveloped; one
held a single family home

Loans from
Thomasville
National Bank
with balance
owed in excess of
$759,000

Elimination of
over $790,000 in
debt obligations

Elimination of
On February 26, 2010,the Court approved the sale of this
over $759,000 in
property for $725,000 and an agreement with Thomasville
debt obligations
National Bank wherein the bank agreed to accept the
purchase price less commissions in exchange for a full
settlement of all amounts owed under the loans and the
waiver of all claims against the Receivership estate(Doc. 352).

Page 2 of 14

Receivership Assets Sold or Otherwise Disposed

Asset

Description of Asset

Disposition

Loans/Liens

Amount
Received
Waived

Land Lot 11 of the 23rd
Land District of Grady
County, Georgia

Approximately 33.296 acres of
undeveloped land

None known

On April 25, 2011,the Court approved the sale of this
property for $135,000(Doc. 620).

$123,717.84

2433 West Main Street,
Tupelo, Mississippi

A building owned by Scoop Real
Estate, LP which was being
leased to a Starbucks

None known

On February 22, 2011,the Court approved the sale of this
building for $715,000(Doc. 601).

$651,216.18

5 McCollum Station,
Newnan, Georgia

A gas station which consisted of None known
approximately two acres of land
and a 3,500 square-foot building

On August 4, 2010,the Court approved the sale of this
property for, in pertinent part, a purchase price of $1,725,000
and payment of $25,000 by the buyer to the Receiver for legal
fees and costs associated with the buyer's failure to close a
previous transaction (Doc.451).

$1,750,000.00

22 Nantucket Circle,
Oberlin, Ohio

1,450 square foot single family
residence

On September 6, 2011,the Court approved the sale of this
property for $100,000 less pro-rated real estate taxes for 2011
up to the date of closing(Doc. 651).

$98,383.30

None known

Page 3 of 14

Receivership Assets Sold or Otherwise Disposed

Asset

Description of Asset

Residential condominium in
774 North Jefferson
Avenue,Sarasota, Florida Jefferson Pines

Loans/Liens

None known

Disposition

On May 18, 2011,the Court approved the sale of this
condominium for $55,000(Doc. 630).

Amount
Received
Waived
$48,347.79

On April 17, 2012,the Court approved the sale of this building
for $950,000(Doc.819).

$898,699.91

$2,655,000
On May 8, 2012, over Wells Fargo's objection, the Court
interest-only loan entered an order granting the sale of this building for
from Wells Fargo $2,400,000. Wells Fargo filed an emergency motion for
reconsideration of this order, which the Court denied on May
15, 2012(Doc. 853). Wells Fargo has asserted a claim to the
proceeds of the sale of this building. The proceeds of the sale
are currently being held in reserve until Wells Fargo's claim to

$2,229,463.15
(being held in
reserves until a
claim to these
proceeds is
resolved)

4905 Waters Edge,
Raleigh, North Carolina

None known
A building which was leased to
Electronic Data Systems ("EDS").
EDS' lease term ended in January
2010 and the Receiver was
unable to find another tenant.

841 South Main Street,
Graham, North Carolina

A building which was being
leased to a Rite-Aid Pharmacy.

them is resolved.
780 Woodlake Blvd.
Tazewell, Tennessee

An undeveloped lot in a golf
community

None known

On April 5, 2012,the Court approved the sale of this property
for $45,000(Doc. 811).

Page 4 of 14

$40,322.86

Receivership Assets Sold or Otherwise Disposed
Amount
Asset

15576 Fruitville Road,
Sarasota, Florida

Description of Asset

Residential property

30393 Upper Bear Creek Residential property
Road, Evergreen,
Colorado

Respiro, Inc.

Loans/Liens

Disposition

$209,264.92 due
on loan from
Northern Trust as
of July 15, 2013

On July 18, 2013,the Court approved the sale of this property
for $181,500 and an agreement with Northern Trust wherein
the bank agreed to accept 60% of the net sale proceeds in full
satisfaction of the loan with the remaining 40% of the net
proceeds to be paid to the Receiver(Doc. 1044).

$68,450.55

$377,749.50 due On July 18, 2013,the Court approved the sale of this property
for $750,000 and approved the Receiver's intent to satisfy the
on loan from
Freddie Mac
outstanding amount on the Freddie Mac loan at closing with
the balance of the sale proceeds going to the Receivership
(serviced by
Wells Fargo Bank) estate(Doc. 1043).
as of July 31,
2013

$322,677.60

On October 1, 2013,the Court granted the Receiver's motion
to sell Respiro's assets(Doc. 1075). In pertinent part, Respiro's
assets were sold to Martix Medical, LLC("Matrix")for $65,000
subject to a possible decrease of the purchase price by $250
for each deficient and/or missing patient file. Matrix
reviewed Respiro's files and deducted (i) $6,750 based on
both missing and deficient files, and (ii) $12,500 for amounts
billed by Matrix since assuming control of Respiro but which
had been paid to Respiro. This resulted in a net purchase
price of $45,750. Matrix paid this amount to the Receivership
on October 4, 2013.

$45,750.00

None known
Respiro, headquartered in
Sarasota, Florida, provided home
respiratory services and medical
equipment products.

Page 5 of 14

Received
Waived

Receivership Assets Sold or Otherwise Disposed

Asset

Description of Asset

Loans/Liens

Disposition

Amount
Received
Waived

Tradewind, LLC.

Tradewind owned and controlled $876,505.30 due
31 hangars at the Newnanon a loan with
Coweta airport in Georgia.
the Bank of
Coweta

On March 27, 2014,the Court granted the Receiver's motion
to sell Tradewind's assets(Doc. 1110). In pertinent part,
Tradewind's assets were sold to a private buyer for
$1,200,000 and the Court approved the resolution of the
outstanding balance of the Bank of Coweta loan from the
proceeds of the sale. The resolution of this loan balance also
resolved a claim submitted by the bank in the claims process.
The Receivership received the net amount of $322,482.43
from the sale of Tradewind's assets.

$322,482.43

Fairview, North Carolina

Residential property

On November 18, 2014,the Court approved the sale of this
property for $287,500(Doc. 1151). On July 28, 2015,the
Court approved a settlement agreement wherein the parties
agreed that the Receiver would pay BB&T $10,000 to resolve
BB&T's claim to any portion of the sale proceeds for this
property (Doc. 1187). The remainder of the sale proceeds was
deposited into the Receivership accounts.

$257,270.59

Remaining
principal balance
of approximately
$248,941.73 on
loan from Branch
Banking and
Trust Company
("BB&T")

Page 6 of 14

Receivership Assets Sold or Otherwise Disposed

Asset

Description of Asset

Disposition

Loans/Liens

464 Golden Gate Point,
Unit 703, Sarasota,
Florida

Residential property

Primary
mortgage loan in
the amount of
$956,000 and a
home equity line
of credit with an
initial balance of
$880,000

On April 29, 2015,the Court approved the sale of this
property for $2,300,000 and approved the Receiver's request
to hold the proceeds until disputes regarding the proceeds
are resolved (Doc. 1177).

3343 U.S. Route 2 and
3353 U.S. Route 2,
Marshfield, Vermont

Two adjacent parcels of real
property

Federal tax lien
for $49,710.12
and property
taxes of
$12,066.69 in
arrears

On March 16, 2016,the Court approved the sale of these
properties for $90,000 free and clear of the federal tax lien
and approved the Receiver's request to satisfy the
outstanding property taxes from the sale proceeds. The
Receiver received the net amount of $69,242.55 after
payment of the property taxes and costs associated with the
sale(Doc. 1230).

Page 7 of 14

Amount
Received
Waived
$2,147,993.69
which presently
are being held in
a separate
account

$69,242.55

Receivership Assets Sold or Otherwise Disposed

Asset

Description of Asset

Disposition

Loans/Liens

Amount
Received/
Waived

Aircraft and Vehicles
Helicopter

1997 Schwietzer 300

None known

Sold for $200,000(Doc. 100).

$200,000.00

Airplane

1971 Cherokee Piper PA-28-140

None known

Sold for $27,500(Doc. 433).

$27,500.00

Airplane

1978 Cessna 152

None known

Sold for $9,000(Doc. 581).

$9,000.00

Airplane

1977 Baron

None known

Sold for $65,000(Doc. 491).

$65,000.32

Airplane

1996 Learjet 31A

Loan with
General Electric
Corporation for
approx. $2.4
million

Returned in exchange for the cancellation of the outstanding
debt(Doc. 119).

cancellation of
debt of
approximately
$2.4 million

Airplane

1992 Citation

Returned in exchange for the cancellation of the outstanding
Loan with VFS
Financing, Inc. for debt(Doc. 119).
approx.$2.1
million

cancellation of
debt of
approximately
$2.1 million

Car

2008 Mercedes-Benz E63

Leased

The Receiver surrendered this car to the respective leasing
company without penalty and without the lessor retaining
any claim to Receivership assets(Doc. 67).

Page 8 of 14

waiver of penalty
and claim

Receivership Assets Sold or Otherwise Disposed

Asset

Description of Asset

Disposition

Loans/Liens

Amount
Received/
Waived

Car

2009 Volkswagen EOS

Leased

On March 19,2009,the Court granted the Receiver's motion waiver of penalty
and claim
to surrender this car to the respective leasing company
any claim to
without penalty and without the lessor retaining
Receivership assets(Doc. 89).

Car

2008 Maserati Gran Turismo

Leased

On March 3, 2009,the Court granted the Receiver's motion to waiver of penalty
and claim
surrender this car to the respective leasing company without
penalty and without the lessor retaining any claim to
Receivership assets(Doc. 52).

Van

1999 White Ford Van

None known

Sold for $500. Given the dimunitive value of this vehicle, the
Receiver was authorized to sell it without further approval
from the Court(see Order dated March 24, 2009(Doc. 97)

Van

2003 White Dodge Van

None known

Sold for $2,000. Given the dimunitive value of this vehicle,
the Receiver was authorized to sell it without further approval
from the Court(see Order, Doc. 97).

$2,000.00

Truck

2002 Silver Jeep Liberty
(damaged)

None known

Sold for $1,000. Given the dimunitive value of this vehicle,
the Receiver was authorized to sell it without further approval
from the Court(see Order, Doc. 97).

$1,000.00

Jeep

1998 Jeep Wrangler

None known

Sold for $4,500. Given the dimunitive value of this vehicle,
the Receiver was authorized to sell it without further approval
from the Court(see Order, Doc. 97).

$4,500.00

Car

2006 Green Subaru Legacy
Outback

None known

On March 24, 2010,the Court approved the sale of the
Subaru for $16,500(Doc. 371).

Jeep

1997 "Barbie" Jeep Wrangler

None known

On March 2, 2010,the Court approved the sale of the Barbie
Jeep for $7,875 (Doc. 357).

Page 9 of 14

$500.00

$16,500.00

$7,875.00

Receivership Assets Sold or Otherwise Disposed
Amount
Asset

Description of Asset

Loans/Liens

Disposition

Received/
Waived

ATV

2004 John Deere Buck 4x4

None known

Sold for $3,300. Given the dimunitive value of this vehicle,
the Receiver was authorized to sell it without further approval
from the Court(see Order, Doc. 97).

$3,300.00

Utility Vehicle

2001 Kawasaki Mule 4x4 Model
3010

None known

Sold for $4,325. Given the dimunitive value of this vehicle,
the Receiver was authorized to sell it without further approval
from the Court(see Order, Doc. 97).

$4,325.00

Car

2009 BMW 535i

Payoff balance of
$13,433.88 on
loan with BMW
Financial Services

BMW, previously used by Paul Downey in connection with
Quest, was sold for $17,000.00(see Order, Doc. 1050). After
payment of the outstanding loan on the vehicle, the Receiver
received $3,566.12.

$3,566.12

Car

2007 Lexus LS

None known

Seized from Donald and Joyce Rowe and sold for $26,750 at a
sheriffs public auction. After payment of fees and costs, the
Receiver received $24,605.25 from the sale.

$24,605.25

Other Assets Recovered
Marguerite J. Nadel
Revocable Trust UAD
8/2/2007

The Receiver's investigation
None known
revealed that this trust was
funded entirely with proceeds of
Nadel's scheme

On February 11, 2009,the Court expanded the Receivership
to include the trust(Doc. 44). The Receivership took control
of the account and transferred the funds into Receivership
accounts.

Page 10 of 14

$381,142.34

Receivership Assets Sold or Otherwise Disposed

Asset

Description of Asset

Loans/Liens

Disposition

Amount
Received/
Waived

Three bank accounts

Three bank accounts jointly held None known
in Marguerite and Art Nadel's
name which had been frozen at
the beginning of the Receivership

On July 12,2012,the Court entered an order denying Mrs.
Nadel's motion for relief from the freeze order for these three
accounts(Doc. 884). On July 17, 2012,the Court entered an
order directing the banks to transfer all money held in these
accounts to the Receiver (Doc. 887). On August 3, 2012,
$28,384.84 was transferred to the Receiver from these three
accounts. The accounts are now closed.

$28,384.84

Three bank accounts

Two bank accounts held in Art
Nadel's name and one bank
account held in the name of the
Clark-Nadel Revocable Trust
which had been frozen at the
beginning of the Receivership

None known

On August 4, 2015,the Court entered an order granting the
Receiver's motion for possession of these bank accounts and
modifying the asset freeze to permit Wells Fargo Bank to
release the money in the accounts to the Receiver and close
the accounts(Doc. 1189). On August 19, 2015,the Receiver
received $13,610.94, which was the total amount held in
these accounts.

$13,610.94

Jewelry

39 pieces of various jewelry
obtained from Queen's Wreath
Jewels, Inc., Mrs. Nadel, Sharon
Moody, and another profiteer

None known

On March 11, 2011,the Court approved the sale of the
jewelry by public auction (Doc. 608). Through an auction held
by Leslie Hindman Auctioneers on April 10 and 11, 2011,the
Receiver successfully sold all 39 pieces for a total of
approximately $643,890. After payment of commission and
other related expenses, the Receivership estate netted
approximately $591,883.85 from the sale of this jewelry.

Office Furniture

Miscellaneous used office
furniture obtained from
Receivership Entities' offices

None known

Given the dimunitive value of this furniture, the Receiver was
authorized to sell it without further approval from the Court
(see Order, Doc. 97).

Page 11 of 14

$591,663.85

$3,500.00

Receivership Assets Sold or Otherwise Disposed

Asset

Description of Asset

Loans/Liens

Disposition

Amount
Received/
Waived

Home Front Homes
assets

Miscellaneous assets of Home
Front Homes which were not
included in the asset purchase
agreement. These assets
included a pick-up truck, two
small free standing storage
structures, and a telephone
system

None known

Given the dimunitive value of these items, the Receiver was
authorized to sell them without further approval from the
Court(see Order, Doc. 97).

Computer equipment

Miscellaneous dated and used
computer equipment obtained
from the Office

None known

Given the dimunitive value of this equipment,the Receiver is
authorized to sell it without further approval from the Court
(see Order, Doc. 97). The Receiver is selling pieces as he is
able though the internet and other means.

Piano

A Yamaha baby grand piano

None known

On August 1, 2012,the Receiver filed a motion seeking the
Court's approval of the sale of the piano for $9,900(Doc.
891), which the Court granted on August 2, 2012(Doc. 892).

$9,900.00

Paintings

Various paintings obtained from
David Band in connection with a
settlement involving transfers
from Donald Rowe

None known

The paintings were sold through auction. The Receiver
received net proceeds of $1,146 from the sale of the
paintings.

$1,146.00

Receivables/Notes/Securities

Page 12 of 14

$7,600.00

$763.00

Receivership Assets Sold or Otherwise Disposed

Asset

Description of Asset

Loans/Liens

Disposition

Amount
Received/
Waived

Bonds.com promissory
five promissory notes from
notes and shares of stock Bonds.com in the total amount
outstanding of $1,840,636 made
payable to the Moodys and
Valhalla Investment and
approximately 7,582,850
unrestricted shares of Bonds.com
stock

On April 13, 2012,the Court approved the Receiver's
agreement between him and Bonds.com for the repayment of
debt, termination of rights, and repurchase of securities(Doc
81.6). In pertinent part, the agreement(1) retired all of the
indebtedness of Bonds.com to the Receivership as reflected in
the promissory notes in exchange for payment of $2,250,000
within five days of entry of the order approving the
agreement; and (2)allowed Bonds.com to repurchase the
shares of stock for payment of $5,000.

$2,255,000.00

Flagship Global Health,
Inc.("Flagship")
promissory note

Flagship filed for relief under Chapter 7 of the Bankruptcy
Code. The Receiver submitted a claim for $149,300.91, which
was the outstanding balance of the note including accrued
and unpaid interest. The claim was allowed for the full
amount claimed. On July 19, 2012,the Receiver received
$94,525.40, representing 63.3120% of the Receivers claim, in
full satisfaction of the claim.

$94,525.40

The Receiver learned that these shares were escheated to the
State of Florida in March 2012. The state liquidated these
shares in July 2012. The Receiver submitted a claim to these
shares and received a check for $12,797.20 in March 2013,
which is the amount the state had obtained from the sale of
the shares.

$12,797.20

a convertible promissory note in
the amount of $250,000 from
Flagship to Valhalla Investment
Partners

MAM Software shares of 5,564 shares of ADNW stock
which became Aftersoft and is
stock
now known as MAM Software

Page 13 of 14

Receivership Assets Sold or Otherwise Disposed

Asset

Description of Asset

Loans/Liens

Disposition

Amount
Received/
Waived

Endai Marketing Growth, 67,000 shares of Endai stock held
Inc.("Endai")shares
in the name of Valhalla
Investment Partners

The Receiver obtained an appraisal for the Endai shares which
found that the Receivership's Endai holdings were worth
approximately $6,578.24. On August 31, 2012,the Court
approved an agreement for the sale of these shares to Endai
for $15,000(Doc. 903).

$15,000.00

First America Bank Corp. 36,000 shares held in the name
("First America")shares of Neil Moody

On May 5, 2015, First America was acquired by HCFB Holding
Company. The plan of merger provided for approximately
$33 million for all outstanding shares of First America. The
consideration per share was $8.00. This was an all cash tender
with no other options. The Receiver redeemed the shares held
by the Receivership for the total amount of $288,000.

$288,000.00

Page 14 of 14