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Bankrupt Express Grain pays out $57.6 million to bank, finance companies, and a few farmers

Thursday, October 6, 2022, 12:17 pm News Flash Archive

Yesterday, Craig Geno, the attorney for bankrupt Express Grain, finally filed EG's April and May 2022 Monthly Operating Reports.

A comparison of the April and May reports discloses that in May, 2022, EG paid out $57,553,754.25 in grain settlement money to UMB Bank, StoneX, Macquarie, and a few farmers.

This money was paid out as final settlement of the 557 Grain dispute, where farmers, UMB Bank, StoneX and Macquarie were contesting ownership and/or collateral interests in the grain that EG had on hand when it declared bankruptcy on September 29, 2021.

Farmers had delivered some $48 million in grain for which they were never paid, while EG had sold and stored more grain to StoneX and Macquarie than the total amount actually held by EG.

The court had ordered that the grain be converted to cash, and according to the April 2022 report, the segregated cash amounts collected totaled $56.2 million on April 30. The last of the inventory on hand was sold in May 2022.

The $57,553,754.25 paid out in May to creditors broke down as follows:

  $8,599,324.14 -- Consenting Farmers
$10,402,816.40 -- UMB Bank
$30,361,537.55 -- StoneX
  $8,190,076.16 -- Macquarie

StoneX had claimed that EG owed it $36,084,000. Macquarie's claim was for $9,735,000. Both of these creditors therefore received 84.1% of their claims in this grain settlement payment.

EG owed UMB Bank $70,589,128.70 in outstanding loans and interest payments, so UMB Bank only received 14.7% of what EG owed from the grain settlement payments. However, UMB Bank also obtained the rights to practically all of the physical assets of EG, which were apparently highly overvalued.

Precisely how much UMB Bank ultimately lost is not known publicly, but its losses are in the tens of millions of dollars.

The "Consenting Farmers" had agreed to the 557 Settlement Agreement. The full value of their claims is not known, as the list of consenting farmers has not been publicly disclosed.

Most of the farmers, however, did not accept the settlement, and rather "disclaimed," or renounced, their interests in the grain that they had delivered. Most of them will pursue UMB Bank under attorney Don Barrett's accusation that the bank conspired with EG to effectively "seize" their grain to pay off UMB Bank's loans.

To understand the complexities of the 557 Grain Settlement, and why so many farmers objected to it, please see here: Express Grain Bankruptcy Court approves Settlement Agreement over disputed grain proceeds

To understand how EG misrepresented its grain inventory ownership and sold more beans than it actually possessed, see here: Filings show Express Grain repeatedly stole soybeans it had sold to others for almost two years

To read UMB Bank's description of how it was swindled by EG, see here: UMB Bank levels new fraud accusations against John Coleman and Express Grain

Finally, to read attorney Don Barrett's accusations against UMB Bank, and attempt to extract the farmers' money from the Bank, see here: Farmers double down in class action suit against UMB Bank in Express Grain failure

As for UMB Bank, it also has claims against EG president John Coleman, who is also in bankruptcy, and Dr. Michael Coleman, both of whom signed guaranties to pay back UMB Bank in the event EG did not.

Operating Reports include the bank balances, the money taken in and spent, the company's balance sheet, receipts and payments, and other matters. The April 2022 report can be viewed here:

April 2022 Monthly Operating Report for Express Grain
Receipts and Payments
Balance Sheet
Statement of Operations
A/R Aging
A/P Aging
Inventory
Payments to Professionals

The May 2022 report can be viewed here:

May 2022 Monthly Operating Report for Express Grain
Receipts and Payments
Balance Sheet
Statement of Operations
A/R Aging
A/P Aging
Inventory
Payments to Professionals

Monthly Operating Reports must be filed every month until the bankruptcy case is concluded. As of the time of this publication, the June, July, August, and September operating reports have not yet been filed.


To read all our coverage of the Express Grain bankruptcy case, see here: Index of Express Grain articles

 

John Pittman Hey
The Taxpayers Channel

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