John K. Harris, founder of a Goose Creek-based tax resolution business that was driven to bankruptcy by consumer complaints, improperly took millions from the insolvent firm and should return the money, a court-appointed bankruptcy trustee alleges.
JK Harris & Co. and several associated businesses shut down in January, several months after seeking bankruptcy protection to escape an attempt by the Texas Attorney General to force the company into receivership over consumer-related restitution payments and fines.
Employees weren’t paid for their last several weeks of work, according to court filings, creditors were owed more than $20 million that would not be repaid, and thousands of clients who counted on the company to resolve their tax problems were left in limbo.
In the months that have followed, the trustee handling the case has complained, as have some creditors, that Harris has not cooperated with efforts to identify assets of the defunct company. He has been a no-show at some meetings and hearings.
In a related civil suit, over unpaid rent at JK Harris former offices, 58-year-old Harris is being pursued for payment of a $355,972 judgment. Last month Harris testified before Judge Mikell R. Scarborough, Charleston County’s master in equity, that he had no assets except for about $400 in the bank and a boat with an overdue loan.
Scarborough ordered Harris to turn the boat over to his former landlord’s law firm.
Now, bankruptcy trustee Michelle Vieira is seeking a nearly $4.8 million judgement against Harris, alleging that he improperly took at least that much out of JK Harris and related companies while they were insolvent, from 2004 until they shut down.
Efforts to reach Harris’ attorney today were not immediately successful.
Read more in Thursday’s editions of The Post and Courier.