AUBURN, IN – Auctioneer Dean Kruse has been ordered by a local court to pay more than $1.3 million to an Indiana bank, and a leasing company has asked a federal judge to repossess Kruse's 1985 Cessna jet, which had been insured at $3.5 million, according to AutoWeek.
These two recent events are on top of several months' worth of financial woes for one of the classic-car world's best-known auctioneers.
AutoWeek reported in August that people from across the country were complaining that they had not been paid for cars sold at various Kruse International auctions. Some who finally received checks say those checks bounced. Some people have retained attorneys; several have complained to state attorneys general. The Arizona Department of Motor Vehicles issued a “cease-and-desist” order against Kruse International, and the state's inspector general office is investigating complaints.
Kruse, who launched his auction company in 1971, cited the economy and cash flow for the slow payments, according to AutoWeek.
“We auction 11,000 vehicles a year,” said Kruse. “Our receivables usually run $300,000 to $400,000. Now, they're $6.5 million,” he said back in August.
In the most recent court cases, a bank near Kruse's operation in Auburn said the classic-car auctioneer's $4.5 million loan taken out in 2005 was due to be repaid by Aug. 31. According to Fort Wayne newspaper the Journal Gazette, nearly $1.2 million remained unpaid on the loan by the end of July, and the note continued to accumulate interest of more than $223 a day. DeKalb Superior Court Judge Monte L. Brown ruled last week that Kruse must pay $34,325 in attorney fees, plus court costs and more than $1.2 million.
But it doesn't stop there for Kruse. According to AutoWeek, two foreclosure lawsuits against him are pending. Kruse and his wife allegedly owe more than $6.5 million in unpaid loans, and the company holding the mortgage on Kruse's auction park says another loan is in default for $7.8 million. FCOF Midwest Credit LLC filed for foreclosure on that property in May.