Farmers stuck with worthless grain checks or unfilled grain payments in the Farmers Cooperative Assn. bankruptcy are being asked to sell the portions of their claims that have the best chances of being paid.
And an FCA representative isn't happy about it.
Liquidity Solutions Inc., of Hackensack, N.J., has sent letters to grain creditors offering to pay $1,419 for each farmer's $4,300 unsecured priority claim.
"If they want to settle for a third of that in the hand now versus wait six months for the whole thing, that's their decision," said Don Dumler, FCA's president and chief executive officer.
The company would pay now to get access to more money later, and the offer doesn't sit well with Stan Lentz, an FCA attorney.
"There are people out there trying to take advantage of people who have already been taken advantage of," Lentz said.
The grain creditors are farmers who sold grain before FCA filed for bankruptcy in September but have yet to receive payment either because the FCA checks didn't clear or because payment was deferred.
The first $4,300 in claims for each grain creditor is considered a "priority" claim. Such claims are in line to be paid after FCA's secured creditors CoBank and UMB Bank but before other unsecured claims.
Payment of all claims must be approved by the U.S. Bankruptcy Court.
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