By James Clark | email
LUBBOCK, TX (KCBD) – Ten Lubbock area residents not only stand to lose a lot of money, but now a court ruling on Thursday might feel like salt in the wound. Federal Judge Sam Cummings overruled all the remaining objections of former Benny Judah investors.
Judah is serving 25 years in prison for charges related to a 3-year Ponzi scheme. The 250 or so investors, mostly from Lubbock, will lose the vast majority of their $50 million that they had placed into Judah's hands. A court-appointed Receivership Trustee seized Judah's Lubbock businesses, some of which are well known, and began selling them along with Judah's real estate to at least partially pay back investors.
So far, more than $2 million has been set aside for repaying investors.
On August 27th, the court held a hearing for 20 unhappy investors who argued that they should get credit for interest as well as their original investment with Judah. Only 10 of the 20 went forward with their objections.
One such investor, Dr. Craig Rhyne, wrote a passionate plea to the court, saying Judah's Excel Leasing Fund did not start as a Ponzi Scheme and therefore interest should be paid at least for the time in which it was a legitimate fund.
"The greatest injustice of all will be visited upon those investors that are already at the greatest disadvantage if you rule otherwise," Rhyne wrote.
The judge disagreed.
Consistently the judge ruled that investors should be paid strictly on a "cash in, cash out" basis and those who were paid interest or dividends must subtract such amounts from their claims or in some cases pay it back.
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