Corporate America’s Pay Day – Proceeds from U.S. Central Suit?
A big, loud no comment – that is how Corporate America CEO Thomas Bonds responded to a reporter’s request for clarification of a sudden $2.5 million inflow of “other income” in the Alabama corporate’s August income statement.
The exact amount is $2,553,550 and it appeared in a column that more typically has entries in amounts like $35,335, which happened to be the September entry. The year-to-date amount accrued in this line is $3,110,246, meaning most of it showed up in the August statement.
That month also was notable because a suit filed by Corporate America against directors and officers of the now-defunct U.S. Central had been scheduled to come to trial commencing Aug. 1.
The suit alleged that the December 2008 conversion of some $450 million in member capital shares into Tier 1 capital resulted in wiping out hundreds of millions of dollars’ worth of capital – and that the directors and officers of U.S. Central knew this would happen.
And then it was abruptly announced that the suit had been settled.
Calls to Corporate America executives and to attorneys for both sides went unreturned at that time as a cone of silence descended.
Sources said a term of the settlement was a strict confidentiality agreement, and nobody involved in the litigation broke the silence.
Nobody is talking now, either – but there is the unexplained $2.5 million bulge in Corporate America’s balance sheet.
“I have nothing to say about that,” said Corporate America’s Bonds.
And there, apparently, is where matters stand.