SALEM, Ohio — More details have emerged regarding the financial status of the defunct Pigeon King International and its bankruptcy proceedings.
In a statement signed June 26, PKI owner Arlan Galbraith revealed debts of more than $23.5 million to breeders and vendors across the U.S. and Canada.
Galbraith sent a letter to breeders telling them of his bankruptcy June 17. The formal filing was made July 2.
Galbraith revealed owned assets of only $46,003, including a 2007 Dodge 1500 pickup truck and 2008 GMC van valued at $20,000 each.
He listed ‘trade fixtures’ at his Waterloo and Moorefield offices at $3,000 each, and the remaining $3 of his assets were attributed equally to livestock; loans, advances or accounts receivable; and cash on hand.
In the lurch
Galbraith’s accounts payable totaled a staggering $23,542,400, including money owed to Alma Poultry Farm in Moorefield, Ontario; various barn rental or pigeon breeding creditors, and trade accounts.
At the time of the bankruptcy, Galbraith owed some $2.8 million to owners of barns he rented across the U.S. and Canada.
One of those barn owners, Rudy Gingerich of Danville, Ohio, previously told Farm and Dairy he was the first in the U.S. to go into business with Galbraith.
Gingerich would travel the state to pick up about 3,000 young birds Ohio breeders were selling back to the company each month, and hold them on his farm in the barns rented by Galbraith.
According to the filing, Galbraith rented Gingerich’s barns for $2,100 a month. His losses over the next four years from Galbraith’s breach of contract total more than $100,000.
The highest rental loser is a farm in Moorefield, Ontario, which had been paid $5,000 a month in rent, for a total loss of $240,000.
Bankruptcy documents identified 12 Canadian and 24 U.S. operators who rented barn space to Galbraith. In the U.S., four are in Ohio and six are in Pennsylvania.
Breeders
Although Galbraith previously refused to provide a full list of contracted breeders, the latest filing shows 168 breeders in Canada and 277 in the U.S. Those breeders were owed $20 million, according to the filing.
However, the list is likely incomplete since it does not include the names of all known breeders Farm and Dairy has interviewed about pigeon breeding in the past year.
The list names 49 Ohio breeders and 85 in Pennsylvania.
Galbraith’s top creditor in the U.S. was a farm in Green Ridge, Mo., owed $700,000. The next two creditors on the list debt-wise were in Republic, Ohio, at $250,000; and Enon Valley, Pa., at $225,000.
Vendors
Galbraith also carried $277,000 of debt owed vendors, according to the filing. Some of those vendors included radio stations, print publications, feed stores, printing companies and Bell Canada telephone.
The filing also included a list of 16 people previously employed by Pigeon King International. The filing said those people were mailed notice of the bankruptcy the week of July 1.
Still more
Galbraith’s total amount owed to abandoned contractors will climb higher as more details about finances emerge.
According to bankruptcy trustee BDO Dunwoody Limited, Galbraith initially operated the pigeon breeding business as a sole proprietorship, so many of the early contracts are with him personally and not the Pigeon King International entity.
BDO Dunwoody Limited is not representing Galbraith, only Pigeon King International, in proceedings. Figures of Galbraith’s own debts were not available.
No assets
Breeders with contracts with PKI, Galbraith or his other company, Benn Contracting Inc., were included in the filing.
Galbraith’s own Sacred Dove Ranch, which was incorporated in February 2007, “apparently had no assets or liabilities,” according to the bankruptcy trustee handling the matter.
Related coverage:
Pigeon King International: Breeders struggle to get rid of pigeons (7/10/2008)
Pigeon King owes $23 million (7/10/2008)
Bankruptcy filing says Pigeon King owed $23 million (7/3/2008)
UPDATED: Pigeon King goes bankrupt (6/26/2008)
Pigeon King International bankrupt (6/19/2008)
Pigeon King gets wings clipped in Maryland (6/12/2008)
Washington finalizes cease and desist order against Pigeon King International (5/15/2008)
Washington takes action against Pigeon King International (5/1/2008)
Pigeons point to Ponzi scheme (3/13/2008)
Pigeon idea may not fly: Iowa investigating company for scheme (2/21/2008)
You’re raising what? Pigeons! (9/13/2007)
From now, farmers have to be very careful what they will do.
Since the Bankruptcy Trustee has been appointed by Galbraith himself, Galbraith will try to have the money put into PKI by the farmers to be considered as investments instead of accounts payable.
That way, most of the farmers would not be considered as creditors and could not vote at the end of July creditors meeting.
If I was an American farmer, I would contact the FBI asap and make sure that a Court appointed receivership would be appointed instead, then all the money recovered from PKI, Galbraith and the first comers in the scheme, in order to create a pool of money. Then, the pool would be shared between all the creditors on a fair basis.
If I was a Canadian farmer, I would do the same thing, except that I would contact RCMP instead of leaving the file dormant in the hands of the Waterloo Regional Police that already considered that evident Ponzi fraud as a normal business practice and perfectly legal in Canada, as we all saw on TV.
So… the chances of the farmers seems very thin with them.
Remember that, according to the figures already published, around $100,000,000 have been collected by PKI, and around $40 to $50,000,000 spent.
Where is the other $50 to $60,000,000 ? At the Galbraith’s Cochrane Sacred Dove Ranch, hidden in coffers ?
Follow the money, my friends, and make sure to ask the hard questions, otherwise you risk to see Galbraith and his crooks benefiting from your hard-earned millions up to the end of their life.
Michel J. Grenier