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Blackland under the terms of the purported $2 and $2.5 million
lines of credit. There is, however, no evidence in the record of
the filing of a financing statement by petitioner to perfect his
purported security interest in the property and assets of
Blackland with respect to funds he transferred to Blackland.
Also on March 10, 1995, there was adopted on behalf of
Blackland a resolution to allow petitioner and petitioner’s wife
(who was not an officer or employee of Blackland) access to “any
or all funds” from Blackland’s bank accounts. The resolution
reflects no limit on the purpose or use for which petitioner and
his wife were authorized to make withdrawals from Blackland’s
bank accounts.
Between 1992 and 1995, using the funds received from
petitioner, Blackland loaned millions of dollars to the tenant
farmers to whom Garland Farms had leased farm properties. The
funds loaned to the tenant farmers were used by the farmers to
pay farm operating expenses and living expenses. On some
occasions, Blackland would directly pay third-party vendors for
expenses of the tenant farmers, and Blackland would add to the
balance of the farmers’ outstanding loans the amounts it had paid
to the third parties on behalf of the farmers.
Funds loaned by Blackland to the tenant farmers were secured
in favor of Blackland through security interests on the farmers’
crops and crop proceeds, and Blackland’s security interests
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Last modified: May 25, 2011