PLAINVILLE — An auction has been set for June 27 for the Plainville Livestock Commission’s real estate, vehicles and equipment in attempts to recoup some of almost $14.5 million in debt the business owes in its bankruptcy.
The real estate will sell at 11 a.m. and will be administered by the bankruptcy trustee, James Overcash. The equipment, vehicles and other property will be sold by Bud Palmer Auction starting at 1 p.m. at the livestock commission property at 907 NW Third in Plainville.
Plainville Livestock Commission declared bankruptcy on March 1. Tyler Gillum, 47, and his wife, Camden Gillum, 50, owners of the Plainville Livestock Commission were federally indicted on a check kitting scheme on May 29.
The Gillums are charged with 31 counts of bank fraud, one count of making a false statement to the Small Business Administration in an application for a $1.5 million loan, and one count of making a false statement to Almena State Bank in an application for a $500,000 line of credit.
The indictment alleges investigators examined unfunded checks and wire transfers totaling more $2 billion sent by Tyler Gillum as part of the scheme.
The indictment alleges the Gillums defrauded Almena State Bank in Almena; Landmark Bank in Manhattan; Colorado East Bank and Trust in Lamar, Colo.; Astra Bank in Scandia; TBK Bank in Dallas; Guaranty State Bank in Beloit; and The Bank in Oberlin.
Dozens of cattle producers were caught up in the scheme after money that was supposed to be set aside to pay cattle sellers was transferred from a custodial account to the Plainville Livestock Auction’s operating account. The Almena Bank froze both accounts, which resulted in bounced checks amounting to tens of thousands of dollars per producer.
Almena Bank filed an interpleader case, which is legal action that seeks to determine to whom the money that was transferred out of the custodial account belongs. In the interpleader case, Almena bank indicated Plainville Livestock Commission had defaulted on three loans with its bank totaling more than $3.49 million.
The interpleader case has been transferred from Norton District Court to federal bankruptcy court. That case is pending separate from the main bankruptcy proceedings and is still working its way through the court system.
According to court documents filed May 31 in federal bankruptcy court, the trustee indicated Almena State Bank has the first lien on the real property to be sold at the upcoming auction and the the second lien on the equipment.
The property consists of two tracts, one of which is 21 acres and the other 0.65 acres. The property is valued at $734,030, according to the Rooks County Appraiser’s office.
The trustee determined TBK Bank has first lien on the equipment. According to court records, TBK Bank is owed $227,238.
The attorney for TBK did not wish to comment on the bankruptcy or the pending auction, Almena Bank did not return previous calls regarding this story.
There are also secured loans on four trucks and a skid loader. The creditors that hold those liens will be paid first on the sale of those items. The claim on these items amount to more than $92,000.
The machinery, equipment, vehicles and office equipment were valued at about $542,000 with cash, equivalents and accounts receivable worth an additional $211,000 according to court records.
According to court documents, Plainville Livestock Commission debt is almost $14.5 million of which $3.7 million is secured debt. Landmark Bank of Manhattan is listed as an unsecured creditor with the commission owing $8 million.
In the time leading up to the Livestock Commission’s bankruptcy filing and the Gillums’ indictment, records show the Livestock Commission earned $2.2 million in 2017, $1.9 million in 2018 and $225,000 before the commission was shut down in 2019.
Some of the personal property to be auctioned includes office and kitchen equipment from the cafe, such as tables and chairs, computers, refrigerators, ice machine, and a grill.
Some of the stockyard equipment includes tractors, ATVs, mowers, chutes, trailers, gates, tanks, and a welder.
A representative of Bud Palmer Auction said a sale bill will be posted on the company’s website in the coming days.
The trustee has leased the sale barn to Lloyd and Judy Schneider dba Heartland Regional Stockyards, a livestock market agent with a separate license from the Gillums. They are also listed as creditors in the bankruptcy. Hays Post has also tried to contact the Schneiders about the case.
According to court documents, Heartland’s lease will be terminated within six days following the approval of the sale of the real estate by the bankruptcy court.
Any funds from the auction that are greater than what is owed to Almena Bank, TBK or other lien holders will go to the bankruptcy estate, according to court records.
Overcash is set to appear before the bankruptcy court to report on the sale at 9 a.m. June 28 or as soon after the sale as possible.
Any other remaining assets that are not listed in this sale will be sold at a separate, future sale, according to court records.
That includes trucks, a Chevy Camaro, more trailers, semi and other items.
Check Hays Post for more on this developing story as details become available.