Evergreen Security investors are trying to recover $500,000 from the Orlando-based firm, whose management perpetrated the largest consumer-investment scam in Florida history in the 1990s, according to the Orlando Sentinel.
The investors filed a lawsuit against Orlando law firm GrayRobinson P.A. to recoup fees the firm received from a former client accused of participating in the fraud. The lawsuit states that the firm improperly withdrew $510,000 in fees from it held in a trust for financial adviser J. Anthony Huggins.
However, GrayRobinson claims the suit has no merit.
“It’s a frivolous claim, and we will respond to it appropriately,” said Biff Marshall, a partner with GrayRobinson. “Our firm was properly authorized by the client to withdraw those funds as payment for services.”
Evergreen investors have targeted the Huggins trust fund held by GrayRobinson as part of an international effort to recover their losses.
Last year, an Orlando bankruptcy judge ordered Huggins and his associate Jon M. Knight to pay $8 million for their role in the scam, which cheated investors out of nearly $215 million. The two were also ordered into involuntary bankruptcy as part of the collection effort.
Huggins and Knight were accused of a Ponzi scheme that paid returns to initial investors using money raised from later investors. They denied the allegations and appealed the decisions, but it was recently upheld in the U.S. District Count.
Evergreen went into Chapter 11 bankruptcy. Lawsuits and criminal chares were filed against the perpetrators. Bankruptcy trustee Bill Cuthill Jr. tried to find a lot of the money, which was put away in offshore accounts. Two years ago, when Evergreen emerged from bankruptcy, investors hired Cuthill as the operation’s president. Cuthill states that he recouped around $27 million of the money.
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