Bankruptcy judge orders victim to pay back thief
Bankruptcy
Mark Poveromo feels ripped off twice over. A judge ordered him to repay money he collected from a builder convicted of stealing from him — and told him to kick in the thief's attorney fees and court costs, too.
Some legal experts say the case, in which a criminal case in Connecticut intersects a bankruptcy judgment filed in St. Louis, shows a need for Congress to revise the nation's bankruptcy laws to better treat people who are awarded money as part of ruling in a criminal case.
"This is an outrageous decision," said Anthony Sabino, a law professor at St. John's University and a bankruptcy expert. "I think it's a miscarriage of justice."
"I can't even begin to fathom it," Poveromo said. "Crime does pay."
The case began in 2006, when Poveromo hired Mark R. Koch of Illinois for an $80,000 project to construct a building for his pet food business in Thomaston, Conn. Poveromo paid $39,500 up front, but Koch never did any work, according to court documents.
Poveromo filed a criminal complaint, and Koch was convicted in Connecticut of first-degree larceny in April 2007 and ordered to pay restitution. Koch paid $25,000 and began monthly payments to Poveromo on the balance, but that's when the law turned on Poveromo.
Two months before his conviction, Koch filed for bankruptcy protection in St. Louis, halting any monetary claims against him. Poveromo says notices of the bankruptcy filing was sent to Poveromo's old business address and he didn't see them.
Koch then filed a complaint to the bankruptcy court accusing Poveromo of intentionally violating the stay on claims by having him arrested to collect on his debt.
Judge Charles Rendlen III agreed with the builder. In a ruling filed in December, and without hearing from Poveromo, Rendlen noted "the highly suspect timing" of Koch's arrest and conviction after filing for bankruptcy.
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