By summit1031bk

By summit1031bk [ http://connect.oregonlive.com/user/summit1031bk/index.html ]

Dear Summit 1031 Exchangers,

July 16, 2009

I am so sorry your money has been caught up in the Summit 1031 Bankruptcy. You have reason to be very upset. You trusted Summit 1031 with your money and suddenly the company is in bankruptcy court. It is an unfortunate situation for all, but mostly for the exchangers. Summit 1031 owed exchangers $27.8 Million, but they only had $13.6 Million in cash. Their shortfall was $14.2 Million. How could this have happened? It is upsetting and you want answers, but mostly you want all your money back! I can understand the anger you have. Who wouldn't be angry? You have every right. You also deserve to hear the truth about what has happened.

GOAL: Are there better solutions to getting your money back to you? I want to know and I want to do what I can to make that happen.

Did you know the principals of Summit 1031 always wanted to turn over their assets to help pay off their debt to you? They never intended for this to happen and have always wanted to do what was right by their clients. However, since the company filed for Chapter 11 Bankruptcy, this has been practically impossible. All that seems to be going on is rising professional and attorney fees. I just submitted an objection to fees amounting to almost $1 Million. I am doing this to help minimize the cost, help maximize the value back to the exchangers because it is what the principals and I want.
I know you have no reason to trust me, but if you want to know more about what is happening to your money, I have posted the information on a website.

I don't think the principals of Summit are not to blame. Their business was not able to pay you back. They should have to deal with whatever consequences they get, but based on the truth or at least the complete facts and circumstances that led to their bankruptcy. They did not intend for this to happen and they just want you to get your money back. They have been, since DAY 1, wanting to give all they had to cover the shortfall. They transferred practically everything they owned personally to help pay you back, but with the outrageous legal fees and the falling market it will be tough.
Please know that if the principals could go back and do a better job at getting your money to you they would, but now your money is in the hands of Kevin Padrick and I want you to be aware of what he is doing to get your money back. I think Terry Vance would do a better job and maybe you would not have to pay Kevin Padrick and his team of professionals the $1 Million of professional and legal fees they have submitted in their fee application. This is only for 5 months worth of work. Kevin Padrick is supposed to have this job for 5-7 years. At this rate, it will be at least $11 Million for the duration of his tenure as bankruptcy trustee.

Please go to my website at http://www.summit1031bkjustice.com for more information. I think you having more information on this case can only help you to get your money back.

Yesterday, I received an email from David Aman at Tonkon Torp, Kevin Padrick's legal counsel, requesting I remove the taping of the presentation from my website. I already researched the legality of this taping with an attorney and it was allowed because this presentation is considered semi-public and the video equipment was not concealed. Apparently, they don't want this video out there for the public to see. Why would that be? Take the time to watch the video and read the transcript to see why Kevin Padrick and Obsidian Finance doesn't want you to see this. It will be interesting to see what Kevin Padrick's next step will be to get this taping off of my website. I will update you as events occur...stay tuned!

Sincerely,

Stephanie Studebaker-DeYoung

(I am an investor in 4 of the LLC's where the principals' interest has been transferred to the Trustee of the Summit Bankruptcy and I am the daughter of Mark Neuman, one of the principals of Summit 1031. I am a person who wants your money paid back to you.)

12:24PM

By summit1031bk

July 16, 2009

Below is a more complete recap of what is going on in the Summit 1031 Bankruptcy Case...

Legal & Liquidation Services
Posted: 2009-07-11 by Summit 1031 Kevin Padrick Complaint

Kevin Padrick Complaint

Complaint Rating:
Company information:
Obsidian Finance Group, LLC
Bend, Oregon
United States
www.obsidianfinance.com

I have been dealing with a lawyer, Kevin Padrick, who knowingly took advantage of a business, Summit Accommodators, Inc. dba Summit 1031 Exchange, that was having liquidity problems by selling himself and his companies, Obsidian Finance Group, LLC, services to them. He told them his company would help facilitate 1031 exchanges, fund the exchanges, and liquidate the assets for top dollar to earn their high hourly rates and 15% commission. The shareholders of the company were not familiar with bankruptcy law because their company was not in danger of bankruptcy for the last 15 years. It was only when the real estate market collapsed that they found themselves with a liquidity problem. They couldn't get temporary loans, the could liquidate property, they couldn't get paid back on loans owed to them. However, when they declared bankruptcy, they still had $13.6 Million in the bank account. Kevin Padrick, Senior Principal of Obsidian Finance Group, LLC, saw the cash in the bank and decided that a few million of the cash should be his. Instead of helping the debtor facilitate the exchanges and liquidate the assets, he and his company did nothing except stall and go to the other side (creditors' committee) with priviledged information (debtor's gave him) claiming he had done all the research and somehow convinced them to give him the job as Chief Restructuring Officer. Originally, this was a bankruptcy that was a debtor in possession with a Chief Restructuring Officer (CRO) in charge of the restructuring efforts. Obsidian Finance was supposed to be working for the CRO. Obsidian Finance or Padrick did not communicate with the CRO or the debtors. Instead, they communicated with the creditors. All of a sudden, the Court said their needed to be a trustee and Kevin Padrick was appointed as bankruptcy or liquidating trustee.

The CRO had already figured out there was no Ponzi scheme and he was doing his job working with all the parties and liquidating properties. He approved $750K of sales before he was dismissed. Obsidian Finance & Kevin Padrick charged the bankruptcy estate $184K to get their Senior Principal the job of Bankruptcy Trustee. Then simply by transferring the remaining cash (cash not distributed to creditors) OR $6 Million, Kevin Padrick charged the estate 3% or approximately $1/2 Milllion for a simple bank transfer & money in checking when he got the job. Then Kevin Padrick hired legal counsel, Tonkon Torp, to harass innocent people until they run out of money and energy and give up their interest in properties where they put their hard earned money in and have every right to still own that interest. Tonkon Torp is charging the estate $270K of which most is for services that bring no benefit to the creditors, but hike up their hours and legal fees earned. The more time they waste, the more money they are able to charge. Total charges between these 3 entities is almost $1 Million in just 5 months. The only amount of money they have brought into the estate is $10K. Pursuant to 11 U.S.C. Section 330 of the United States Chapter 11 bankruptcy code, (3) in determining the amount of reasonable compensation to be awarded to a Trustee or professional person, the Court shall consider the nature, the extent, and the value of such services, taking into account all relevant factors, including...

(A) time spent on such services (Who gets paid $184K to land a job)
(B) the rates charged for such services (Kevin Padrick's rate is $600/hour and all he does for the hourly rate is waste time, allege things without proof, and harass innocent people until they throw up their hands and give them their property)
(C) whether the services were necessary to the administration of, or beneficial at the time at when the service was rendered. (Who gets $164K to transfer money from one bank account to another???? The remaining is simply 3% of what was in the Summit 1031's bank account when Kevin Padrick took over the job as Trustee)
(D) whether the services were performed within a reasonable amount of time commensurate with the complexity, importance, and nature of the problem, issue, or task addressed (Kevin Padrick makes it look like it is more complex than it is, he does nothing to make things move quickly, he ignores and loses offers on properties ($900K worth so far), and he has caused the majority of the delays in this case)
(E) with respect to a professional person, whether the person is board certified (Kevin Padrick is an attorney so he does fit this part of the code)
(F) whether the compensation is reasonable based on the customary compensation charged by comparably skilled practitioners (The attorneys are trying to finish the 1031 exchanges and the estate is paying for their learning curve...The attorneys have charged $125K more than a Qualified Intermediary would charge for the same work)

(4) (A) The Court shall not allow compensation for...
(i) unnecessary duplication of services (I identified almost 200K is for duplication of services)
(ii) (I) services that are not reasonably likely to benefit the debtor's estate (Kevin Padrick knows this is not a Ponzi scheme and there was not any Embezzlement, but he is trying to use this to drum up claims against innocent third parties. The fees that have been charged to go after innocent third parties is $111K. By the time everyone figures out there was no Ponzi Scheme or Embezzlement, Kevin Padrick will be $6Million dollars richer and on his way to benefit from someone else's misfortune. He has only netted the estate $3K, but has charged the estate almost $1Million. How is this benefitting the creditors? It seems that it is mostly profitable to Kevin Padrick, Obsidian, and Tonkon Torp for providing absolutely no value to the estate)
(ii)(II) necessary to the administration of the cased (This if for the Court and/or US Trustees Office to determine)

On 7/2/09, I filed an objection to these fees. To view this objection, go to http://www.summit1031bkjustice.com/?page_id=1196.

There is also a taping of Kevin Padrick & Obsidian Finance's presentation to interested parties and shareholders included on this site at http://www.summit1031bkjustice.com/?page_id=254. At this presentation Kevin Padrick does not want us to take notes, does not tell us who sent him to the creditors' committee, and does not tell us how he is going to bring value to the estate. From this presentation, it is difficult to tell what type of professional competence would warrant costing the estate $1 Million in Attorney and Professional Fees.

12:34PM

By summitripoff

July 16, 2009

I would like to respond to Summit1031bk. I imagine that this is difficult for your family, however your father and his business associates acted fraudulently and with no integrity. The executives of Summit 1031 are educated and extremely intelligent and to claim any ignorance is just unacceptable. You are in essence making an attempt to distract the public from the actual issue at hand. If you think that Summit executives had no idea that these attorney fees would be assessed through bankruptcy, you are clearly being deceived. Most of these executives are (hopefully were) Certified Public Accountants and Attorneys and were perfectly aware of the consequence to their actions, they only hoped they would not get caught. I encourage people that visit your website and read your dribble to use their brains and see that you obviously are a stakeholder in a very bad situation involving your father. I would refer to this as "smoke and mirrors".......unfortunately no magic trick will be able to return funds to the investors who trusted Summit 1031 with the exchange funds.

3:45PM

By summit1031bk

July 16, 2009

I am not using "smoke and mirrors". I am providing information, documents, research, and facts to make exchangers aware of how their money is being used. It is not dribble, it is the truth. Have you done all your research here?

I am trying to inform the people who lost money due to these events with the complete information in time to save themselves money. $2.2 Million in fees is what we have so far - only 5 months worth of billings. There are 100 or so exchangers footing this bill. So if each 1031 exchanger was owed the same amount of money, each exchanger is footing the bill to pay these "professionals" $22,000 for 5 months with no results. Personally, I think this is your hard earned money going down the drain.

I know that Summit didn't do anything against the law. I know that the principals want to make it right and have done everything they could to try to payback the creditors. The video shows clearly the principals wanting to pay the exchangers back as quickly as possible. I know there is value here because they transferred it all to the bankruptcy estate. I see no evidence that Kevin Padrick has created value for the exchangers and I have done all of the legwork to get this information. If you have facts and documents to the contrary, please comment on my website.

Kevin Padrick and associates are charging fees to the tune of $1 Million to bring only $10K of proceeds into the estate. I know that most of Summits exchangers are savvy real estate business people and they understand business transactions so why would they knowingly pay "professionals $1 Million dollars for a $10K return?

There is a hearing on September 2nd on the fee applications. If there are enough exchangers that look at the facts and decide that maybe their money is not wisely being spent or utilized or the trustee is profiting enormously from their misfortune, then they could possibly save themselves $1 Million. I am not so sure the exchangers are aware of this. I question if the exchangers understand all of the facts and circumstances.

Summit principals messed up and they have done everything they could to make it right and they will continue to do so. There was no Ponzi scheme and no embezzlement. They are accountants and they have accounting on everything. They want the exchangers to get paid back. I want the exchangers to get paid back. What are your motives?

Rather than sittting around and dwelling on who is to blame, I suggest that we all work together to see that the exchangers get their money. Otherwise, it is possible that before the exchangers realize what happened, the money will be spent on "professional" fees. I just don't want it to be too late for the exchangers to get their money back. This is why I have put countless hours into this work.

Best Regards,
Stephanie Studebaker-DeYoung

11:09PM

By summit1031bk

July 17, 2009

If you want to save yourself almost $1 Million, then listen up! On September 2, 2009, there is a hearing on the fee applications. The fees haven't been authorized by the court yet. Make sure your money is being used wisely and in your best interest.

To see Kevin Padrick & Obsidian Finance's "professional" presentation Go to http://www.summit1031bkjustice.com/?page_id=254

Best Regards,
Stephanie Studebaker-DeYoung

7:09AM

By summit1031bk

July 18, 2009

What is this Spat Between Kevin Padrick and Stephanie DeYoung Really About?

I mean this Stephanie Studebaker DeYoung is an unlikely Source to be standing up, somehow for the very consumers her dad's company is said to Have "ripped off". But that is exactly what she is doing. You see it is said that Financial Consultants and Attornies are Eating up the Money that the Real Estate Consumers Should Be Getting.

Tough to Believe Stephanie Studebaker - DeYoung when she is VERY connected to a part owner of Summit 1031 Exchangers, and it is kind of an us against them right.. Consumers that were Trying to do a 1031 Exchange against the Big Bad Summit 1031? The Media, we know they always tell the truth and the whole story, well the Media feels sorry for the Real Estate Consumer, as do I but they are NOT getting down to the Nitty Gritty to Expose where the money is REALLY being tied up at, who or what is holding up Millions upon Millions of Dollars ? What if there is more to the Story and the More is the KEY to you getting your Life Back?

Well there seems to be some sort of Smack Down between Stephanie DeYoung and Kevin Padrick, and Being the Real Estate Industry Whistleblower, I wanted to dig deeper and see if there was anything to all this, if the real estate consumers really need to know, if their was signs of Real Estate Corruption, Real Estate Lies that My Real Estate Consumers ( that YOU) NEEDED to know and it turns out there is a TON of information that you truly do need to know.

Read More...
http://www.realestatelies.com/2009/07/what-is-this-spat-between-kevin-padrick.html

http://www.summit1031bkjustice.com

http://www.youtube.com/watch?v=7-xt6FLCpE0

11:09AM

By summit1031bk

July 19, 2009

The whistle is being blown...toot toot...Kevin Padrick, Obsidian Finance, & Tonkon Torp didn't want you to know that they have been milking the estate and will continue to do so until it is too late. You can stop them...contact the creditors' committee and their counsel and the US Trustees office. Ask your questions, get your concerns heard. Check the court public records. Google Kevin Padrick and Obsidian Finance to see what they have been doing...The TRUTH is finally getting out and it is in time to save you much money and heartache. Please check into this because there is a hearing on September 2nd on the fee applications. If the fees are approved, you may have to pay Kevin Padrick, Obsidian Finance, and Tonkon Torp (Kevin Padrick's Legal Counsel cuz he sure needs it) and say goodbye to $1 Million Dollars. OR start checking into this. Gather your own information. The truth is out there for you to get now.

Contact your representatives...

Jeanette Thomas of Perkins Coie
Portland
PHONE: 503.727.2075
FAX: 503.727.2222
JThomas@perkinscoie.com

Jake D. Miller at Jake.D.Miller@usdoj.gov

Go to My Website for the Whole Truth...And Updates on the case.

http://www.summit1031bkjustice.com

Other Reporting on this case can be found on the following sites...

http://www.realestatehoax.com/

http://www.realestatelies.com/

http://www.realestatenark.com/

http://www.realestateindustrywhistleblower.com/

http://www.kalispellmontananews.com/

http://www.realestateillusion.com/

http://www.brokerszone.com/

12:17AM

By summit1031bk

July 19, 2009

Contact your representatives...

Jeanette Thomas of Perkins Coie
Portland
PHONE: 503.727.2075
FAX: 503.727.2222
JThomas@perkinscoie.com

Jake D. Miller at Jake.D.Miller@usdoj.gov

Go to My Website for the Whole Truth...And Updates on the case.

http://www.summit1031bkjustice.com

Other Reporting on this case can be found on the following sites...

http://www.realestatehoax.com/

http://www.realestatelies.com/

http://www.realestatenark.com/

http://www.realestateindustrywhistleblower.com/

http://www.kalispellmontananews.com/

http://www.realestateillusion.com/

http://www.brokerszone.com/

12:22AM

By summit1031bk

July 19, 2009

Contact your representatives...

Jeanette Thomas of Perkins Coie
Portland
PHONE: 503.727.2075
FAX: 503.727.2222
JThomas@perkinscoie.com

Jake D. Miller at Jake.D.Miller@usdoj.gov

Go to My Website for the Whole Truth...And Updates on the case.

http://www.summit1031bkjustice.com

Other Reporting on this case can be found on the following sites...

http://www.realestatehoax.com/

http://www.realestatelies.com/

http://www.realestatenark.com/

http://www.realestateindustrywhistleblower.com/

http://www.kalispellmontananews.com/

http://www.realestateillusion.com/

http://www.brokerszone.com/

12:24AM