“Article” posted on Wally’s BK

http://tampabankruptcy.pro/blog/6752/angry-investors-meet-bankrupt-walter-ng/

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21 thoughts on ““Article” posted on Wally’s BK

  1. Thank you John Robie for posting above. Cruising google under “Walter Ng” I found it tooand did not know what to do with it. Who knew there was a Bankruptcy Blog? I hope someone can determine the method in which we can identify the ages of the Ng victims. I am 69, practically an infant compared to the 97 year old person that I heard about today. Can you just imagine the added burden of looking through decades of documents, trying to understand their meaning, worrying about your lost safety net, while attemping to be David to the Ng goliath and his platoon of expensive attorneys. It feels like being stabbed over and over and over again…never, ever being able to relax as the cloud hangs over your head that you will be spending the remainder of your life in litigation.

  2. “About 3,000 of them gathered, spilling into the hallway of the bankruptcy court.”

    It must have been a BIG hallway!

    The ‘3000 investor’ figure is going to need revisited. That number may be indicative of the number of ‘accounts’ but the number of ‘investors is’, I believe, less. Many investors (including me) had multiple accounts.

  3. Some investors have received a letter from Swanson and McNamara, Walter’s criminal defense team, asking us to agree to stay the Adversary Complaints on Walter’s bankruptcy case that we filed on August 5th until after a Chapter 11 reorganization plan has been approved. Anyone have advice/suggestions/comments on whether we should agree to stay these? Do we lose any rights by doing so? Staying these might save unnecessary legal costs.

    • Let our attorney’s on this blog answer that. We don’t want them to have any leverage in their favor. I don’t believe anyone but ourselves have our backs and we might be giving up something that we have no clue what they are attempting to do. Equitatus, John Robie, Robert Brower can you help on this?? I don’t believe allowing a Chapter 11 will help us, it will only help them. They will never have to pay anyone out of their pockets if we allow then to file for bankruptcy protection. I can’t imagine the Ng’s living a good life while I am suffering so much.

      • Whenever I receive an unsolicited offer to settle, I look at the
        offer from both sides. Let’s start with Walter Ng’s side.

        There are currently 18 adversary proceedings on file which need
        answers filed in each one. Mr. Kaplan and Farella Braun + Martell
        are not authorized to represent Walter Ng in any of these cases.
        Swanson and McNamara have a Court Order allowing their firm to
        represent Walter Ng in all criminal investigations and proceedings.
        So, Kelly Ng needs to hire a third law firm to handle the pending
        adversary proceedings against his father.

        Does he have the money? One indicator is the retainer that Kelly Ng
        paid to Swanson and McNamara. It was $50,000 from Bar-K, money
        that Bar-K received from the judgment in the Hawaii airport case after
        defense costs were paid and the remainder was laundered through a
        Farella Braun + Martell trust account. At $500 per hour, this retainer
        represents 100 hours of work. In my view, a realistic retainer would
        have been for 500 hours, $250,000. This is based upon the complexity
        of the criminal problems, which include the Department of Labor
        investigation and a possible $800,000 to $1,000,000 fine, the re-opened
        SEC investigation and the criminal fraud investigation by the FBI.

        Kelly Ng has his own problems. This week the Court will hear a motion
        for discovery into his assets in the sexual molestation case. He will have
        to settle this case and he will need at least six figures to do so.

        So Kelly Ng probably does not want to spend more money to hire another
        firm to defend the adversary proceedings against his father. Swanson and
        McNamara crossed the line drawn by the Judge and sent out an unedited
        error-filled letter, probably as a favor, pro bono.

        Let’s look at the deal from your side.

        How hard will it be for you to try your case? First, we have to assume
        that the Judge will order the class action to go first. If the class action
        succeeds, then your case is moot. You win by showing up. Second,
        if you go first, what will be the defense. Because of the pending criminal
        investigation, Walter Ng will assert his Fifth Amendment privilege. Kelly
        Ng cannot testify. Kelly Ng was prepared to take the Fifth Amendment
        when he was served to testify in the McGuire case. Barney Ng will testify
        for you. Bruce Horwitz is an unknown.

        What’s in the deal for you to wait? As i see it, nothing.

        Is there a better deal?

        Listen to the audio from the last status conference and pay close attention
        to the Judge’s comments. The Judge proposes that Walter Ng agree
        that your claim is not dischargeable. That’s might be a better deal for
        you.

        • Thank you for your comments. Everything you write on this blog has been very helpful to me and I really appreciate you taking the time to do that.

        • So – is this correct that Walter is using investor’s money from the funds to retain a personal criminal lawyer? This is sickening!! How do we stop this?

          • No. Sorry that I did not make it clear.

            The criminal defense attorneys retainer of $50,000 was
            paid with money from BAR-K. BAR-K lost its real estate
            brokers license and is not operational. The funds come
            from a judgment awarded to BAR-K from the Hawaii
            airport litigation. From those funds, the BAR-K attorneys
            in the Hawaii airport case were paid first. The rest of the
            BAR-K money was sent to Farella Braun + Martell were it
            was laundered through a trust account. The money that
            was left was given back to Kelly Ng and Walter Ng for, or
            on behalf of, BAR-K.

            So it was never investor’s money. It was BAR-K’s money.

            I hope that this makes it clear.

          • Okay, Robert … AND … We were part of Bar-K (and B-4 partners before that) and had significant funds invested… we understood that those monies were moved to RE-Loans, LLC. Why did the $50,000 not go back into the funds, rather than be left to now be “gifted” to Walter to pay his criminal lawyer’s retainer?? We have not had access to any of our monies for a few years now… why did Walter have instant access to these monies??

          • Arlyss,

            You were never part of BAR-K. BAR-K was a licensed real estate broker.
            BAR-K is a California corporation. You were never a stockholder in BAR-K,
            you did not sit on the Board of Directors of BAR-K, and you were not an
            officer of the BAR-K.

            BAR-K stands for Barney and Kelly. They own BAR-K, 50-50.

            You were never part of B-4 Partners, before or after. The B-4 Partners
            were Walter Ng, Kelly Ng, Barney Ng and Bruce Horwitz. After Bruce
            Horwitz resigned in 2009, there have been three members of B-4 Partners.
            The current ownership interest is 25% Walter Ng, 25% Barney Ng, and 50%
            Kelly Ng.

            The money from the Hawaii airport judgment belonged to BAR-K. BAR-K
            filed the case and BAR-K won the judgment. After an appeal, the money
            that paid off the judgment in favor of BAR-K, went to BAR-K.

            This money was not a “gift.”

            If Kelly Ng wants to spend $50,000 of BAR-K’s money to pay his father’s
            criminal defense attorneys, then you cannot object. You have no standing
            to object.

            Your interests in certain limited partnerships merged into R.E. Loans. But
            R.E. Loans did not have the right to any of the Hawaii airport case money,
            which belonged to BAR-K. R.E. Loans has no right to object to how Kelly Ng
            uses BAR-K’s money

            Take for example, the investors in R.E. Reno. The Siena was sold and the
            proposed net sales proceeds are $3,438,283.17. These proceeds are subject
            to a proposed surcharge of $422,200, leaving $3,016,083.17 to be distributed
            to R.E. Reno.

            R.E. Loans had a 40% interest in the Siena loan, so R.E. Loans should get
            $1,206,433 from the net sales proceeds. If Mr. Weissenborn and Wells Fargo
            Foothill decide to distribute that to you as an investor in R.E. Loans, then you
            will get a check for your percentage interest in R.E. Loans. If Mr. Weissenborn
            and Wells Fargo Foothill decide to pay down the line of credit, you will get nothing.

            On the other hand, if you were an individual investor in R.E. Reno, then you should
            get a check for your percentage of the remaining 60%, $1,809,650. If that money is
            not paid to the individual investors on a pro rata basis, then those individual investors
            have a right to object because someone would be stealing their money. Anyone who
            is not an individual investor in R.E. Reno has no standing and no right to object.

            In this same way, you cannot object to Kelly Ng using $50,000 of BAR-K money
            to pay for his father’s criminal defense attorneys’ fees and costs. You have no
            standing to object.

          • Thanks so much for your detailed response.. I think I understand that we have no standing with those monies extended to Walter. Your understanding of this is so much better than most investors (me included) and I so appreciate you helping us all to understand it . We were (luckily) not part of the Sienna debacle, but hopefully your insight is helpful to them.. Thanks again for all that you do to help us all!!

            Let me know when you are doing a cooking class in Orinda!! I would love to attend….Arlyss

        • Mr. Brower: You state there are several Attorney’s representing Walter but specifically you state the complexity of the criminal problems which include the DOL with a large fine? Also, the SEC Investigation and the Criminal fraud investigation by the FBI. Do you know the status of any of these cases? After all of these fines imposed on the owners and managers, will there be money left or will they have to pay out of their pockets? I know this is a lot to ask but I feel we are in the dark with any resolution on these Federal entities. Thank you for any response you can offer.

          • The federal agencies work in secret so it is difficult to predict when they will file.

            The SEC filed a claim (No. 56) in the R.E. Loans bankruptcy case on February 3, 2012.

            It stated:

            “The staff of the Securities and Exchange Commission (“Commission”) has been conducting an investigation into certain pre-bankruptcy transactions and practices involving R.E. Loans, LLC (“RE Loans”). Based on this investigation, the Commission may file a civil action against RE Loans in an appropriate forum based on possible violations of federal securities laws. Such an action may result in a judgment against RE Loans, which may include penalties, disgorgement, and prejudgment interest. Accordingly, the SEC files this protective Proof of Claim to preserve any relief to which it may be entitled should such a judgment be obtained against RE Loans.

            The SEC reserves the right to amend and supplement this claim as appropriate under the circumstances.”

            I think that this claim means that an SEC action is likely and imminent.

  4. Dear Mr. Brower,

    Thank you so much for the information you provided us regarding what we should do about the letter from Swanson & McNamara. Again, we don’t know how to thank you for all that you have done to help us through this tragic situation.

    A wounded investor.

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