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Large cattle scam settlement proposed
DES MOINES (DTN)--Victims of a huge Midwest cattle scam may recoup just 3.4 cents on the dollar of their investments with Missouri cattle brokers George Young and Kathleen McConnell, a Kansas City bankruptcy trustee said in an article in the Omaha World Herald Oct. 13.
After records showed Young and McConnell claimed to have nearly 344,000 cattle under management, but only 17,000 head could be found, their cattle buying and feeding business closed in August 2001.
Young and McConnell, now serving federal prison terms, were found guilty of selling the same cattle to multiple investors.
According to the article, the U.S. Bankruptcy Court in Kansas City, Mo., is to be asked later this month to approve a "global settlement" that lists a total of 138 people in 13 states. The victims had a total of $177 million invested with the Young's business.
Under the agreement, those investors and other unsecured creditors would split $6 million. About 90 percent of Young's former customers have signed on to the agreement, the Omaha paper stated.
Trustees said the ultimate goal for the victims at this point is to recover their out of pocket losses, not what their profit would have been. Most clients have agreed to the settlement, but a few remain undecided.
The article said the proposed settlement in the bankruptcies of convicted Missouri cattle brokers George Young and Kathleen McConnell would pay:
--$11.5 million to U.S. Bank and First National Bank of Omaha, including $4.6 million already paid to U.S. Bank.
--$6 million to 180 investors, feedlot operators and other unsecured creditors.
--$1.3 million to bankruptcy trustees and other firms that worked on the case, with $100,000 held for other expenses until the case is closed. Final payout could be in May.
Date: 10/18/04
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