Thursday, March 1, 2018

Hathaway Homes Group Owners Gamble Away Their Business

Trustee finds Hathaway records in ‘shambles’
Posted: February 28, 2018 5:01 p.m.
By BRYAN CLARK in the Post Register

The books don’t match the bank statements. The records are in “shambles.” Contracts are missing or unsigned. Money that court filings claimed was in the bank isn’t there.

And in the short period between when Hathaway Homes Group lost a $3.8 million lawsuit to a lender it defrauded and when it filed for bankruptcy, its owners, Paul and Mikki Hathaway, took $30,000 of their customers’ money and gambled it away at the Planet Hollywood Resort and Casino in Las Vegas.

Those are among the key revelations of an investigation completed by Chapter 11 Trustee Gary Rainsdon, who was appointed to take over the company after a bankruptcy judge found gross financial mismanagement.

Rainsdon filed earlier this month to convert Hathaway Homes Group’s Chapter 11 bankruptcy, which would attempt to keep the company in operation in order to pay off its creditors, to a Chapter 7 liquidation, where the few remaining assets would be sold off to pay the creditors a portion they are due out of the small amount that remains.

Hathaway Homes Group was one of the region’s largest distributors of manufactured homes, modular homes and RVs, with sales offices in St. Anthony, Idaho Falls and Williston, N.D. But the company is bankrupt. It faces a consumer protection suit from the Attorney General’s Office, lawsuits from former customers who allege they were ripped off, and a $3.8 million judgment for a Utah lender which was defrauded. The Fremont County Sheriff’s Office also appears to be conducting a criminal investigation.

Rainsdon’s findings match closely with the stories 15 former customers and two former employees have told the Post Register in on-the-record interviews. In particular, they confirm the widespread practice of taking large down payments from customers and then failing to perform any work at all, and instead transferring the funds for personal spending and gambling.

Rainsdon wrote that files showed that in some instances where customers made down payments, some in excess of $100,000, Paul Hathaway never ordered a home to be constructed by the factory.

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1 comment:

Scott Peterson said...

I am happy to say that I helped one homeowner get the house he paid for. When Hathaway crossed the border into Montana, they thought that the State of Montana wouldn't protect their own. Hathaway was wrong and it helped lead to their downfall.

If anyone is in need of a home in the Idaho Falls area, stop in and visit with Mark and Jennifer at SmartMods. Mark and Jennifer helped out many of the Hathaway victims, just because.