ATM Financial Files Bankruptcy Amid Fraud Accusations

Wake County, FLA Garner Company named ATM Financial, has decided to file for bankruptcy amid last week's accusations that the company committed fraud against one of its clients. The Tuesday bankruptcy filing in Florida's federal bankruptcy court is in an effort for the company to use Chapter 11 bankruptcy to reorganize its debts.

In the filing, ATM Financial listed both their liabilities and their assets at $1 million apiece. As for information regarding financial details, that was not included in the Chapter 11 filing.

Last week, Wake County Superior Court Judge A. Leon Stanback Jr. issued a temporary restraining order against ATM Financial. The attorney for the company states that news of that restraining order did a lot of damage to ATM Financial and that the small size of the company does not help the situation. ATM Financial's attorney also stated that the damage was done before the company could defend itself and states that the company is looking forward to making their side of the story known. The temporary restraining order was issued before ATM Financial had the opportunity to fight it.

As for the company based out of California that is suing ATM Financial, their attorney believes that ATM Financial's bankruptcy filing was in response to the lawsuit filed by them regarding alleged fraud committed by ATM Financial. The California company was looking to freeze ATM Financial's assets and retrieve key documents that are believed would implicate them in fraud. Their attorney states that the bankruptcy tactic has been used before by other companies, but acknowledges that ATM Financial has a right to file bankruptcy in an effort to seek financial protection.

The California company filing suit, ATM Equity, has made accusations that Vance Moore II, the owner of ATM Financial, and ATM Financial were engaging in fraud in order to control approximately 1,200 ATM machines at convenience stores, gas stations, and various other nationwide outlets. ATM Equity states that they lost $30 million to the company in what they allege are the result of fraud because ATM Equity trusted ATM Financial to operate these machines on their behalf.

What ATM Equity later discovered, as alleged in the lawsuit, is that some of the leases were not real and that some of the machines are owned by other companies rather than by ATM Equity like they were supposed to be.

The temporary restraining order that was sought by ATM Equity was obtained in order to freeze ATM Financial's bank accounts as well as the company's owner's bank accounts. The temporary restraining order has also ordered ATM Financial to turn over important documents. A hearing to extend the restraining order will be held on Monday.

However, ATM Financial's bankruptcy filing stops any litigation against them, but still allows ATM Equity to go ahead with its lawsuit against Moore, the owner. The bankruptcy will delay the lawsuit against ATM Financial, but the attorney for ATM Equity intends on filing a motion that will ask the bankruptcy court to make ATM Financial comply with the court order that has been issued in Wake County. Despite the bankruptcy filing, the attorney for ATM Equity feels that it will not stop them from getting to the bottom of the situation and ATM Equity's attorney has also stated that the Chapter 11 bankruptcy filing simply means that a fraction of what is owed to creditors will be paid. As far as ATM Equity, they are not considered a creditor since ATM Financial was operating ATM machines on behalf of ATM Equity. This means that the money earned by the ATM machines is the property of ATM Equity.

By Ginger Gillenwater