The following frequently asked questions and related answers are subject to change pursuant to further orders of the Court.
1. What does the Final Order Allocating Trust Fund Shortage mean to me? (New question)
This Final Order incorporates and/or supersedes a number of earlier, interim orders of the Court. Subject to a stay or overturning of this Order (as discussed below), it represents the decision of the Court on the allocation of the Cash Trust Fund Shortage. The Court had earlier determined accounts to be included or excluded from the allocation and, in general terms, they are set out on the Home page of this website.
It is now the responsibility of Millennium Trust Company, as successor trustee, to implement the allocation, based on this Final Order. Millennium will be sending a communication to all account holders whose accounts are included in the allocation advising them of their account balance(s) upon which the allocation will be based, the specific amount of the allocation applicable to their account(s) and providing alternative methods by which they can meet their allocation.
Several account holders and investment advisors have informed the Receiver and the Court that they will appeal and seek a stay of the Final Allocation Order as they are appealing the Order to the Illinois Appeals Court. The stay motions will be heard by the Court on March 16. If the stay motions are denied, Millennium is obligated to commence the implementation of the Final Allocation Order. If the stay motions are granted, the Final Allocation Order may not be implemented until the appeals of the Final Allocation Order are heard by the Appeals Court, which may take many months.
2. How do I know if I am excluded from the allocation?
Exhibit A to the Final Allocation Order lists all accounts which were at Intrust and indicates, for each account, whether it is included in the allocation and also whether a March, 1999 statement is available to the Receiver. To view Exhibit A, click [here].
3. What is the status of the allocation and the release of trust funds?
Approximately 1,200 account holders and investment advisors have appealed the prior decisions of the Court with respect to the allocation of the $68.1 million trust fund shortage in the Intrust trust accounts. A list of the lead account holders/investment advisors that have filed such appeals to date are listed below. On March 1, 2001, the Court entered the Final Allocation Order which set the allocation percentage to included trust accounts at 8.69%. At that time, through counsel, many of such appealing account holders/investment advisors informed the Court and the Receiver that they intended to appeal the Final Allocation Order of the Court and to seek a stay of the enforcement and collection of the allocation percentage from their accounts until their appeals were decided by the Appeals Court.
The Receiver believes that if the appealing account holders/investment advisors are successful in obtaining such a stay, that, unfortunately, the existing restrictions on almost all Intrust trust accounts will likely have to remain in place until the appeals are decided. The Court has set a hearing on March 16, 2001 at 10:00 a.m. to decide whether a stay will be issued by the Court. If a stay is denied by the Court, appealing account holders/investment advisors will likely have the right to seek a stay from the Appeals Court. The Receiver intends to update the status of such appeals and stay rulings through this web site.
List of Appealing Account Holders/Investment Advisors
- Terry G. Bommer and others
- Cooper Linse Hallman Mgt. Inc. and others
- Gary R. Bertacchi
- Ralph Bertacchi
- Therese M. Foster
- Four Seasons Asset Management and others
- J. Phillip O'Brien and others
- Ann Carroll, M.D. and others
- Micheline Abbott and others
- Frederick Blesi and others
- Stanley Wengert, and others
- Lewis Ho and others
- Robert E. Bolinske and others
- Maureen Adams and others
- Carole H. Bergland and others
- Gregory Papadopoulos
- Carmella McDonnell
- Larry C. Merritt, Ruth Arthur and others
- Dolores Vil, James R. Bok and others
- Catherine L. Ahal and others
- Jeffrey Fox and others
- Richard C. McLaurin, Jessica F. Bertoldi, and others
- Deborah A. Scheel
- Michael Elkin and others
- Jessica Bertoldi and others
- John W. Norton
4. When can I have my money? When can I transfer my account?
Unfortunately, there are no easy answers to these questions. The simple answer is when the Court issues a final order "unfreezing" the accounts.
If the implementation of the Final Allocation Order is allowed to proceed (i.e. no stay is granted), Millennium will mail within 60 days to each to each account holder whose account is included in the allocation, an Allocation Statement and details of the allocation process. Within 90 days after the mailing of the Allocation Statements, Millennium must report back to the Court on the status of the implementation and collection of the allocated amounts and the Court will make a determination of when the accounts may be "unfrozen".
If a stay is granted by either the Trial Court or the Appeals Court, it is not possible to estimate when the accounts may be "unfrozen". It is likely, however, that they will remain frozen for many more months.
5. If I am not included in the allocation why can't I have my money now? Why can't I invest my pre-close cash?
Pursuant to Court Order, all accounts are currently "frozen". An order from the Court "unfreezing" the accounts is required before any funds in accounts which are not included in the allocation, can be "unfrozen". Until the allocation and implementation are completed, there are insufficient cash funds in Intrust to meet its obligations to account holders (i.e., the accounts are "illiquid").
6. My account should not be included in the allocation of the shortfall because "………….". What should I do?
Accounts which are included in or excluded from the allocation of the shortage have now been determined by the Final Allocation Order. If you did not file a motion to be excluded pursuant to the Court's 8/17/00 Order and have the Court adjudicate on your motion, it is probably too late to do so.
7. I want to make a hardship request to receive funds from my account for "…………….".
Click on these links to read the [Court's Orders] and the [Commissioner of Banks and Estate's Directives] regarding hardship requests for funds.
8. I want to talk to the Judge who presides over this Receivership.
There are legal procedures by which account holders can bring matters to the Court's attention. The Judge has emphasized that account holders must use these procedures and not communicate with him informally by letter or telephone. Account holders who wish to address Judge Jones must do so through an attorney or by filing an appearance with the Clerk's office to appear on their own behalf. Do not send letters to Judge Jones or make other informal contacts (e.g., telephone calls).
9. The $125 receivership fee is not fair.
The Receiver is attempting to "wind-up" the Receivership as quickly and as efficiently as possible. In order to do so, funds must be available to sustain the ongoing operations of Intrust (e.g., employee salaries, rent and professional fees). The Receivership has been significantly extended because of the concerns of certain account holders that they be excluded from the allocation and this has increased the need for funds to continue the Receivership.
10. Can I have access to post-close funds deposited with Intrust?
Yes, pursuant to paragraph 29 of the 4/14/00 Order of Administration.
11. How long is the Receivership going to last?
Even though the Court has now entered a Final Allocation Order, because of the possible stay and appeal of this Order, it is not clear at this time when the allocation process will be implemented or completed - see Question #1, above.
In addition to finalizing the allocation process, the Receiver continues to pursue civil litigation against those responsible for the trust fund shortage, pursue claims against Intrust's limited insurance policies and will make distributions to account holders if funds become available. It is not possible at this time to estimate when these responsibilities of the Receiver may be completed.
12. Was Intrust insured by the FDIC, the state or any other governmental agency. Were they required to be FDIC insured?
Intrust was not FDIC insured, insured by the state or some other governmental agency. Additionally, there are no state or federal requirements which required such insurance.
13. Did Intrust have any insurance policies?
Yes, Intrust had very limited insurance policies (a $10 million fidelity bond and a $3 million D&O policy) under which the Receiver has made a claim. At this time, it is unknown whether the loss suffered by Intrust will fall under the terms of either policy.
14. Who is responsible for the Trust fund shortfall?
The Receiver has filed civil litigation against parties we believe to be responsible for the Trust fund shortfall. [Click here to read the Receiver's civil litigation]. The litigation process is ongoing and the web-site will be updated as appropriate. Additionally, various state and federal agencies are conducting criminal investigations into the Trust fund shortfall. The Receiver is cooperating fully with these agencies.
15. What are the tax implications of the allocation of the Trust fund shortfall on an IRA account?
The account holder received a Receivers Certificate in exchange for the Allocation payment. This certificate has a face value equal to the amount paid. As a result, a taxable event has not occurred, until such time as the Receiver Certificate is sold or otherwise determined to be canceled by the Receiver. This process is expected to take time. If the transaction occurred within an IRA, it is unlikely that a taxable event has occurred. Please consult your tax advisor.
16. Although my funds remain frozen at Intrust, may I change my investment advisor?
There is no Court order that requires you to maintain your contract with your investment advisor. Subject to any restrictions in your contract with your investment advisor, you may select another advisor who has or will establish a relationship with Millennium, or you may maintain your account without using any investment advisor.
