Reagor Dykes Administrator Accuses Ford of Cover-Up and Calls for Public Disclosure of Documents | KLBK | KAMC
LUBBOCK, Texas – A lawsuit filed Thursday in the Reagor Dykes bankruptcy case accused Ford Motor Credit Company of knowing about the fraud long before August 2018.
Reagor Dykes filed for bankruptcy at that time amid accusations of fraud and default.
A liquidation plan was approved in July 2020, but details remained on file for the bankruptcy on Thursday. Among them, Reagor Dykes’ bankruptcy trustee had previously filed a claim that Ford Motor Credit Company (FMCC) owed more than $ 315 million in bankruptcy assets.
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The trustee claimed that FMCC was aware of and participated in the very fraud that destroyed Reagor Dykes.
In Thursday’s filing, trustee Dennis Faulkner wrote: “Ford has put its head in the sand while gleefully accepting millions in payments from [Reagor Dykes] and taking advantage of the [Reagor Dykes’] record sales of Ford vehicles.
Put simply, the trustee claims Ford made money from fraud and blocked many Lubbock and West Texas businesses with unpaid bills during bankruptcy. Numerous Reagor Dykes clients were also injured – having paid for vehicles but failed to secure proper titles.
FMCC has denied and continues to deny the trustee’s claims.
In the most recent filing, the trustee wants permission to make more than 12,000 pages of documents public. FMCC has requested that most of these files be sealed.
“Ford is redoubling its efforts to conceal the truth from the public by filing a petition to seal the very documents which prove its knowledge,” the trustee wrote. “This Court should not condone Ford’s attempt to cover up.”
“Ford actually knew that debtors were submitting false sales information long before the fraud was supposed to be discovered,” the trustee also wrote.
As proof, the trustee filed a copy of an email from an HSFC employee dated January 18, 2018. The email read: “Do not put a copy on me on the Reagor audit items , because I don’t want to know. ” The email included a cartoon image of an ostrich with its head in the sand.
In a September 9 court file, HSFC asked a judge to respect the confidentiality of the documents. FMCC has said that trade secrets, business practices and client privacy are at stake. FMCC has also said that there is an order agreed between the two parties and now the trustee wants to overturn it.
FMCC wrote: “Access to this confidential information would give its competitors an advantage that Ford Credit does not have, as Ford Credit does not have access to internal communications from its competitors regarding these processes and procedures. “
A bankruptcy judge has yet to rule on the sealing or opening of the files.