Fargo banks sue Minneapolis auto magnate Denny Hecker over loans
Two Fargo banks are among several lenders who have filed lawsuits this week against Twin Cities auto dealer giant Denny Hecker to ensure the debt isn't forgiven in bankruptcy.
Hecker, who hasn't been charged with a crime, reportedly owes $767 million to creditors - from Chrysler Financial to banks around the country - including nearly $20 million he borrowed from Fargo's Vision Bank and Cornerstone Bank.
Hecker, who filed for bankruptcy in June, was one of Minnesota's largest car dealers until the economic downturn forced him to shut down most of his dealerships. The state began investigating him in June for possible sales tax evasion.
Cornerstone Bank, which initially reported it lent Hecker $4.8 million, reported a loss of $12.74 million, which Hecker obtained by "materially false financial statements," according to court documents. Cornerstone transferred the debt to a third party, Blackstone Financial.
"Denny Hecker's obligation outstanding to Cornerstone Bank was acquired by a third party, and the third party is seeking to collect the debt," said Fargo attorney Brad Sinclair of Serkland Law Firm, which is representing the bank in the lawsuit.
Vision Bank filed a lawsuit on Monday, and according to court documents, lent $7.12 million to Hecker, who it claims "obtained ... under false pretenses, false representations, and/or actual fraud ..." the loan.
Vision Bank officials declined to comment due to client privacy laws and ongoing litigation.
In several media reports, Hecker has denied any wrongdoing.