Saturday, June 29, 2002

County may seize company buildings


Feds move to freeze bank account at Peoples

By James McNair, jmcnair@enquirer.com
By Patrick Crowley, pcrowley@enquirer.com
The Cincinnati Enquirer

        EDGEWOOD — The Erpenbeck Co. could lose its Edgewood headquarters and another building it owns because taxes on the properties haven't been paid in two years.

Erpenbeck
Bill Erpenbeck
        And in a separate legal development Friday, the U.S. government took steps to freeze the bank account of a company headed by former Peoples Bank of Northern Kentucky executives John Finnan and Marc Menne.

        In the Erpenbeck case, the Kenton County Attorney's Office filed foreclosure actions against the properties Friday in Kenton District Court in an attempt to collect $26,993 in back taxes.

        The properties will not be immediately seized. Kenton County Attorney Garry Edmondson said the company will be given an opportunity to pay the taxes.

        But if the taxes are not paid, the buildings could eventually be sold by the Kenton County master commissioner on the steps of the county courthouse — the legal process by which foreclosed property is sold in Kentucky.

        “There are a lot of legal steps to go through before we get to that point,” Mr. Edmondson said. “But if the taxes aren't paid, the properties will be sold so the taxes can be collected.”

        Reached Friday on his cell phone — the telephones at the troubled home building company were turned off more than a month ago — Erpenbeck Co. president Jeff Erpenbeck said he could not comment because he had not yet been served with the official foreclosure papers.

        The properties involved are:

        • 130 Dudley Road, which houses what is left of the Erpenbeck Co. An employer of more than 100 about a year ago, the company now has only a handful of workers at the two-story brick office building, near the intersection of Dudley and Turkeyfoot roads.

        According to Kenton County Property Value Administrator's Office, the building is appraised at $1.2 million.

STORY ARCHIVE
Click here for all Enquirer reports on Erpenbeck Co.
INVESTIGATION
If you have any additional information on the business dealings of the Erpenbeck Co. or Peoples Bank of Northern Kentucky - or on the involvement of any parties not yet identified in our coverage - please email Enquirer business reporter James McNair at jmcnair@enquirer.com or Kentucky Enquirer reporter Patrick Crowley at pcrowley@enquirer.com.
        • 577 Dudley Road, which houses the St. Elizabeth Medical Center Toddler Inn, a day-care center for the nearby hospital. Because the day care is only a tenant, its operations would be not affected by the foreclosure.

        The Erpenbeck Co. is accused in lawsuits and court documents of diverting $25 million paid at closings into its accounts at Peoples Bank of Northern Kentucky.

        In the case involving Mr. Finnan and Mr. Menne, the government initiated civil forfeiture proceedings against a bank account in the name of their company, Jams Properties. The balance of the Peoples Bank account was not disclosed.

        While the two executives ran the bank, they — through Jams — bought about $5 million worth of model homes from Erpenbeck Co., whose residential construction projects were financed in part by Peoples.

        The two men were forced to resign in May. The 19 model homes were named in a forfeiture action May 30.

        Mr. Finnan's lawyer, Richard Goldberg of Cincinnati, said he hadn't seen the lawsuit and wouldn't comment on it.

        “John Finnan feels that when the smoke clears, he'll still have his good name,” Mr. Goldberg said.

        Mr. Menne's lawyer, Harry Hellings of Covington, did not return a phone call Friday.

        The FBI and other federal authorities are investigating the Erpenbeck Co. and the two former bankers for possible bank fraud. One suspect, Bill Erpenbeck, resigned as president of the home builder in March.

       



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