Creditors seek to force bankruptcy of Tinley Park firm – Chicago Tribune

Creditors of a Tinley Park real estate brokerage who claim they are owed hundreds of thousands of dollars are trying to force the firm into bankruptcy.

Oak Park Avenue Realty Ltd. is an affiliate of Mack Industries, also based in Tinley Park, which filed for Chapter 11 restructuring in late March. Oak Park Avenue wasn't included in that bankruptcy filing.

Mack Industries built its business purchasing homes that had been foreclosed on, fixed them up and then found renters for them. Homes were also sold to investors, and Mack in turn would guarantee them a steady income stream by finding renters.

Owners of the homes are owed at least $433,000 by Oak Park in unpaid rents and security deposits collected by the firm from renters, according attorney Brian Jackiw, who is representing them in the petition, filed May 31, seeking involuntary Chapter 11 for the company.

Locally, one creditor, from Orland Park, is owed $153,000, and other property owners are from Frankfort and New Lenox as well as states, including California, Colorado and Virginia. Jackiw said he is being contacted by other property owners who may join the case.

A call left for Oak Park seeking comment was not immediately returned.

Forcing the company into bankruptcy could result in assets being identified that could be sold off to repay Oak Park's creditors, Jackiw said.

He said the investors he so far represents own, collectively, about 125 properties, mainly single-family homes.

Are the amounts as far as unpaid rents owed cover a specific time period?

Jackiw said some of the creditors are owed two months' rent and some are owed for four months. He said Oak Park would generally send property owners monthly account statements showing information, such as how much rent was collected and what management fees were charged by the company, but that, in most instances, Oak Park stopped sending out those reports about two months ago.

In connection with Mack Industries' bankruptcy, allegations of fraudulent financial transactions have been aired against Mack and its founder and chief executive, James K. "Mack" McClelland, who is an owner of Oak Park Avenue Realty.

American Residential Leasing, the largest unsecured creditor in the case, had asked the court to name a receiver a request since approved by the judge to oversee Mack's operations, alleging there have been "several million dollars' worth of potentially fraudulent" fund transfers and distributions among Mack insiders and affiliated companies.

Separately, lender Colony American Finance sued McClelland individually, alleging he owes more than $19 million to the company for defaulting on a December 2015 loan agreement, the proceeds of which were used to buy and rehab properties. In its complaint, filed just weeks after Mack Industries' Chapter 11 filing, Colony American states $9.8 million was advanced to McClelland for rehab work and alleges that some of that money was "misappropriated, misapplied and converted" for other uses.

The trustee in the Mack bankruptcy case recently won court approval to hire a forensic accountant who spent years as an FBI special agent investigating money laundering and fraud schemes.

In explaining in a court filing the need to bring on someone with specialized skills, the trustee noted a "complex history of opaque financial and business dealings" among Mack, its numerous subsidiaries and company principals.

mnolan@tribpub.com

Twitter @mnolan_J

Original post:

Creditors seek to force bankruptcy of Tinley Park firm - Chicago Tribune