Parsons says he’s broke
Jeffrey Parsons and his company, THR and Associates, owe more than $467.2 million to consumers, tax collectors, media outlets and various other entities from coast to coast, according to recently filed documents in federal bankruptcy court that show taxpayers are owed the most.
The 390-page list of creditors and amounts owed includes debts ranging from $2 to more than $1 million. Parsons and his lawyers at an Oct. 22 meeting of creditors said that the tab will likely increase.
The Illinois Department of Revenue is owed more than $453 million for payroll taxes, according to a list of creditors. In response to an emailed query, an employee at the office of Michael Logan, Parsons’ bankruptcy lawyer, said that the amount is the most accurate figure available. In another court filing, however, Parsons says the amount owed to the state is unknown. The state Department of Revenue won’t comment on how much taxpayers owe. Parsons says he owes nearly $8.2 million to the IRS and nearly $17,700 to City Water, Light and Power for utility bills.
During the meeting, Parsons, who declared assets of less than $3.6 million in court paperwork, laid out the rise and fall of a business founded in 2008 that turned into a multimillion-dollar enterprise almost overnight as the price of gold zoomed from less than $750 an ounce to more than $1,700.
“Gold is what kept the ship afloat,” Parsons testified.
During the Oct. 22 meeting, Parsons testified that gold purchased nationwide at buying events typically set up in hotels was sent overnight to THR offices in Springfield and was sold within hours of arrival at The Gold Center on Wabash Avenue. Unlike antiques, art or other items worth what buyers were willing to pay, gold had a set value and could be immediately sold, Parsons said.
“It was like buying cash,” said Parsons. “Basically, I’m buying a $50 bill for less than $50. I’ll buy it for $10 if I can and $45 if I have to.”
At its peak, THR had 180 buying teams combing the country for gold and 25 employees in Springfield listing coins for auction on eBay, with a quota of at least 30 new auctions per day per employee. In 2011, Parsons testified, THR paid eBay more than $1 million in commissions and listing fees as the money flowed. In addition to gold, THR bought antique toys, art, guitars and most anything else that could be sold for a profit, with buying teams using completed eBay listings to help figure out what stuff was worth.
“It was a well-oiled machine,” Parsons said.
Buying teams would hit towns every three months, operating under such names as Treasure Hunters Roadshow and the International Coin Collections Association and the Ohio Valley Gold and Silver Refinery. The beginning of the end came last spring, when PNC Bank, which had not been requiring THR to make good on checks written on any given day until 10:30 a.m. the following day, shut down an account, resulting in hundreds of bounced checks, Parsons said.
Shortly afterward, eBay closed THR’s account without explanation, ending a revenue stream of as much as $200,000 a week, Parsons said. With eBay gone, THR shifted inventory to retail outlets called Buy Sell Trade in Jacksonville, Champaign and Springfield. Those stores closed last summer along with J. Parsons, a store on Springfield’s west side that offered a potpourri of goods ranging from clothes to toys to foodstuffs to used jewelry.
Parsons’ income has plummeted from nearly $8.9 million in 2010 to $183,418 this year, according to documents filed in bankruptcy court that don’t include figures for 2011. According to court records, he is now working as a consultant for his son Jacob’s business in Lincoln called Uncle Buck’s Trading Post, which, like Jeffrey Parsons’ failed enterprise, buys precious metals and other valuables for resale. Court filings show that Parsons is being paid $4,000 a month by his son, who made the last two $9,200 monthly payments on Parsons’ home in Panther Creek. Parsons in court filings said that he gave his son $66,000 to establish the business last summer even as THR was circling the drain.
“Any assets of THR there (at Uncle Buck’s) for sale?” asked Jeffrey Richardson, the trustee assigned to the company’s bankruptcy case.
“Absolutely not,” Parsons answered.
“Bullshit!” a man in the audience, who later identified himself as Aaron Homer, a former THR employee, cried out, bringing the proceeding to a brief pause before he stormed out of the room. “Have fun getting fitted for your orange jumpsuit, Jeff.”
Parsons has not been charged with a crime, but he might owe money to a police department in Wisconsin that is investigating bounced checks, according to court filings. Attorneys general in at least four states, including Illinois, Indiana, New York and Wyoming, are listed as potential creditors, apparently as agents for consumers who received bounced checks. In addition to an IRS agent, a representative from Illinois attorney general Lisa Madigan’s consumer fraud division attended the creditors meeting.
Peggy Ryan, an attorney for Parsons’ estranged wife who has filed for divorce, asked several questions aimed at determining what happened to assets. Parsons said that both he and his company are broke.
“You can say it’s THR property, you can say it’s Jeff Parsons’ property, it’s really one and the same, isn’t it?” Parsons said when Ryan asked about a boat he purchased with silver coins last spring from Todd Green, a local car dealer. “When this is done, I’m not going to have anything anyway.”
Contact Bruce Rushton at email@example.com.