LandAmerica and Okun

The Federation of Exchange Accommodators released their November newsletter recently updating member firms about the legal proceedings in the Ed Okun and LandAmerica Exchange cases.

The Okun case sentencings have now been completed for the wrongs committed in the failure of 1031 Tax Group. The last of three former employees, the chief legal officer of Okun's organization, was sentenced to three years in prison. Along with the 100 year prison term Okun was sentenced to earlier, the chief operating officer was sentenced to 10 years and to five years.

In the LandAmerica case, it appears there is a possible settlement pending on the bankruptcy proceedings. Customers who set money with LandAmerica but did not specify exactly how it was to be held will get $0.25 on the dollar from the former Qualified Intermediary arm of LandAm Title. Customers who put funds in segregated accounts will get will get $0.70 on each dollar they set aside, and customers who specified their funds be put in escrow will get $0.97 on each dollar they put with LandAmerica. In this case the court took a very stringent view of tracing and heavily weighed the argument that the funds were not co-mingled. Seggregated accounts is something we've always strongly advocated (and always followed in our practice).

With the approaching holiday, we at 1031 Corporation want to wish you all a Happy Thanksgiving. We know this year hasn't been an easy one for many of us but we certainly realize there is still much for which to be thankful. We hope your travels will be safe and that you'll enjoy time invested (I always hated the idea that we SPEND time) with family and friends.