Another Payoff

Like Beverly McMillen, former BFA investor Annette Earl also got her life savings back last month. Earl says BFA informed her that someone had purchased her note late in the afternoon of August 5–shortly after a New Times article detailing her plight began to be distributed in newsstands (“I Was Sick . . . and Ye Visited Me Not,” August 6).

Earl, a Black Canyon City resident, says she also was told by a BFA salesman that her money was “just like a CD.” So she invested $99,000 in a “Maximum Value Performance Note” in 1997.

When Earl became seriously ill and tried to get her savings to pay medical bills, she learned from BFA that her money was actually tied up until 2002. She says BFA refused to release the principal, even though she explained her predicament.

BFA claims Earl was not misled about her investment.
In a July 30 letter to New Times, BFA attorney Tom Grabinski says Earl had been informed by a BFA salesman of the “non-withdrawal provision” of the “Maximum Value Performance Note” she was purchasing. The note “prohibits withdrawal under any circumstances,” Grabinksi wrote.

In a September 4 letter responding to New Times questions about the Earl case, BFA president William Crotts wrote: “In keeping with the terms of the Maximum Value Performance Note (MVPN), spelled out in our Offering Circular, BFA does not redeem MVPN’s before their maturity. Although BFA has no legal obligation, we try to help our clients find a buyer for their investment when unexpected emergencies occur. BFA did not redeem Mrs. Earl’s note. We located a buyer who purchased Mrs. Earl’s note for the original purchase price. In the meantime, Mrs. Earl was paid monthly interest at the annual rate of 8.25 percent. In fact, the note was sold prior to your article being published.

“BFA did not return Mrs. Earl’s money,” the letter says.
“The note was purchased by a third party.”
Earl says she still believes BFA would not have returned her money had she not made her predicament public.

–Terry Greene Sterling