Before it went bankrupt, according to 11 complaints filed over the last two weeks by a bankruptcy trustee, owners and insiders of bankrupt Priceville Partners embezzled from the company, gave company cash and vehicles to their friends and families, and even bought homes for relatives.
Bankruptcy trustee Stuart Maples said Friday the complaints were filed to protect the unsecured creditors of Priceville Partners by retrieving assets he believes were fraudulently transferred from the company before it filed for Chapter 11 bankruptcy in the Northern District of Alabama in March 2016. The company listed more than $5.4 million in claims from creditors, and said it had between $500,000 and $1 million in assets.
“I'm attempting to recover funds for the estate so they can be distributed to legitimate unsecured creditors,” Maples said Friday.
Three complaints were filed Friday, and Maples said more complaints may be filed.
The lawsuits were filed against the following defendants, each of whom Maples alleges has possession of assets that should be returned to the bankruptcy estate for the benefit of creditors. Some of the defendants are not accused of wrongdoing, just of having possession of assets that should be available to creditors.
• Harold Jeffreys. One of the complaints accuses Jeffreys, one of Priceville Partners’ owners, with transferring more than $200,000 from the company to his son, Ben Jeffreys, and his son-in-law, John Klein, shortly before the bankruptcy and using company assets to buy his son a house. Harold Jeffreys filed a claim as a creditor in the bankruptcy, but Maples alleges in the complaint that he was deeply involved in mismanagement of the company.
“Ultimately, due to his own gross mismanagement of (Priceville Partners) and pressure from consumers and creditors, (Jeffreys), despite his blind acquiescence, was forced to acknowledge that (Priceville Partners) was a scam,” according to the complaint.
The complaint alleges Jeffreys, of Decatur, fraudulently transferred $700,000 in company assets “to himself, his relatives, and other insiders.”
Harold Jeffreys declined Friday to discuss the specifics.
“I think we’ll probably try it in court,” Jeffreys said. “I’ve got a pretty good lawyer, and we’ll just go from there.”
• Ben Jeffreys. Ben Jeffreys owned 40 percent of the company when it was formed in 2013, according to the complaint, with another 40 percent owned by Greg Steenson and 20 percent owned by Harold Jeffreys. Harold Jeffreys later invested more cash in Priceville Partners and took over his son’s ownership interest.
Ben Jeffreys paid personal bills from the company account, according to the complaint, and with others “engaged in a scheme to make it look like creditors owed Priceville Partners money that was not, in fact, owed.” Ben Jeffreys also received numerous vehicles from the company at no cost, according to the complaint, including sports cars, trucks, trailers and farm equipment.
“Priceville Partners paid approximately $30,000 for a condominium that (Ben Jeffreys) rented at Smith Lake,” according to the complaint.
• Derrick Young. Another complaint seeks to recover the money spent on the condominium from Young, its owner. Maples alleges Young failed to return the money.
• John Klein. Klein was a part owner of a Priceville Partners affiliate that did business as Hoover Title Mart, according to the complaint. The complaint alleges he “used company funds for the payment of personal benefits,” and these “acts of embezzlement” violated the bankruptcy code.
• William Dobbs. In another complaint, the bankruptcy trustee alleges Greg Steenson paid Dobbs $14,000 from a Priceville Partners account for contract labor. The trustee claims these payments were not actually for contract labor, “but were to reimburse (Dobbs) for a loan he had previously extended to Steenson.”
• Bob Brechtel. One complaint alleges Greg Steenson withdrew $12,625 from a Priceville Partners account, used the money to obtain a bank check in the same amount, and provided it to Brechtel as payment “for the personal debt owed by Steenson to (Brechtel) and not for any company purpose.” Brechtel was sued, according to the complaint, because he did not return the money when the trustee requested it.
• Roger Renfroe. The trustee alleges Greg Steenson transferred title of a boat and a pickup, both owned by Priceville Partners, to Renfroe to pay off a personal debt. Renroe was sued, according to the complaint, because he has not returned the property to the bankruptcy estate.
• WTC & Associates. According to the complaint, Harold Jeffreys violated the bankruptcy code by surrendering vehicles to WTC after Priceville Partners filed for bankruptcy. The trustee asks the court to demand return of the vehicles.
• Jonathan Stebbins. According to the complaint, Stebbins and Alyssa Franklin, who is the daughter of Morgan County Sheriff Ana Franklin, “held themselves out to be husband and wife.” According to the complaint, Alyssa Franklin was an employee of Priceville Partners. The trustee alleges Stebbins was unjustly enriched when he purchased a vehicle from Priceville Partners for below its cost, and the purchase was financed at a below-market interest rate. The complaint also alleges Alyssa Franklin received an early payoff of the loan for Priceville Partners, and that she had no authority to forgive Stebbins’ loan.
Ana Franklin is also listed as a creditor of Priceville Partners. She has said she used $150,000 from a jail food account to make the loan. She repaid the loan, she said, with money provided by Steven Ziaja. Ziaja, who was the sheriff’s boyfriend, is also listed as a creditor. He is now facing charges in Montgomery County for allegedly using a law enforcement database for personal gain while he was employed by the Alabama Law Enforcement Agency.
• Jason Steenson. Another complaint alleges Jason Steenson, Greg Steenson’s brother, received money and the use of vehicles from Priceville Partners that he had not earned in his salesman position, and that he owes the bankruptcy estate $97,920.
• Jerry Segars. A complaint seeks to recover $76,500 from Segars, who allegedly is Greg Steenson's ex-father-in-law. According to the complaint, Segars was unjustly enriched by fraudulent transfers from Priceville Partners.
Greg Steenson in 2002 was sentenced to four years in federal prison and ordered to pay more than $5.2 million in restitution after pleading guilty to bank fraud conspiracy charges. According to the bankruptcy complaint, Harold Jeffreys knew of his conviction before partnering with him in forming Priceville Partners, but "claims he believed that since then Steenson had changed his ways."
Jeffreys filed a civil lawsuit in late 2015 alleging Steenson had failed to repay loans and had misappropriated money. The case resolved last month with the Morgan County Circuit Court entering a consent judgment ordering Steenson to pay Jeffreys $3 million.
Steenson is facing charges in Morgan County for eight counts of first-degree theft, two counts of second-degree forgery and one count of second-degree theft, according to court records.
Steenson is accused of selling vehicles for which he did not have a title and for forging names on documents to get replacement titles for cars he sold, said Morgan County District Attorney Scott Anderson.
Maples said Priceville Partners no longer sells vehicles, although it still has some operations.
"There's still some operations continuing to collect on financed vehicles," He said. "We're repossessing vehicles that are in default and still collecting on some accounts."