Local designer’s bankruptcy tied to Fair Finance

An Indianapolis interior design firm’s plunge into bankruptcy can be traced to its ties to Fair Finance Co., the Akron, Ohio-based firm formerly co-owned by convicted Ponzi schemer Tim Durham.

SC Design Inc., operated by Shannon Connor at 4200 N. Pennsylvania St., filed for Chapter 7 bankruptcy Monday, listing debts of $1.5 million and assets of $400.

Nearly all of the debt, or more than $1.4 million, is listed as a claim filed against SC Design by Fair Finance trustee Brian Bash, according to court documents.

Bash has filed dozens of suits since early 2010 on behalf of investors seeking to recover funds transferred out of Fair at a time the trustee alleges it was insolvent.

Durham and accomplices Jim Cochran and Rick Snow are scheduled to be sentenced Friday. A federal jury in June found Durham guilty on all 12 felony charges stemming from the collapse of Fair.

Durham co-owned the firm with Cochran, who was convicted of eight of 12 felony charges. Snow, the company’s chief financial officer, was convicted on five of 12 counts.

Durham faces 225 years in prison, Cochran 145 years and Snow 85 years.

Prosecutors charged that after Durham and Cochran bought the business in 2002, they raided its coffers to fund their lavish lifestyles and to cover losses at failing businesses they owned.

The huge withdrawals—which were recorded as loans but were not repaid—left Fair without the means to repay 5,000 Ohio residents who purchased more than $200 million of the company’s unsecured investment certificates.

Bash, the trustee, so far only has collected $5.6 million for investors, prosecutors say.

He filed suit against SC Design in U.S. Bankruptcy Court in May, charging that Durham and one of his affiliates, DC Investments LLC, transferred Fair funds to the interior design firm in amounts totaling $1.4 million.

Durham made the transfers to the company—48 in all—from June 2006 to November 2010 in amounts ranging from as little as $78 to as much as $196,627, according to the complaint.

Neither Connor nor her attorney returned calls from IBJ seeking comment on the suit filed by Bash.

But her attorney, Nancy Valentine of Cleveland firm Hahn Loeser & Parks LLP, said in a court filing that SC Design is not liable for the money, in part, because the statute of limitations to collect has expired.

Bash’s suit against SC Design does not specify Connor's relationship to Durham. Her website, however, lists Durham and former Durham business Obsidian Enterprises as clients.

FBI agents raided Fair and Obsidian, located on the 48th floor of Chase Tower in Indianapolis, in November 2009.

Connor, an Indianapolis native, established SC Design in 2000 after working in Los Angeles, according to the firm’s website.

The site says she studied interior design at Ball State University and worked in Indianapolis before moving to Los Angeles in 1996, where she also studied production design and set decoration at UCLA.

For all of IBJ's coverage of Fair Finance and Durham, click here.