HDL reneges on VCU deal, trustee questions cash transfers
RICHMOND, Va. — Just after it informed VCU that it must back out of a promise made three years ago, Health Diagnostic Laboratory must also explain what happened to “large sums of money” that may have changed hands in the years leading up to its recent financial troubles.
Assistant U.S. Trustee Robert Van Arsdale, who is overseeing the embattled lab company’s Chapter 11 bankruptcy case, this week questioned Martin McGahan, HDL’s chief restructuring officer, about payouts made to its shareholders as far back as two years ago.
“Some huge amounts of money went around at that time,” Van Arsdale said Thursday at a meeting of the company’s creditors.
Van Arsdale did not go into detail about how much money may have been transferred or to whom.
McGahan, who is also a principal with Alvarez and Marsal, a firm HDL hired to help it restructure financially, gave the primary testimony at Thursday’s meeting. He said the distributions in question took place before HDL hired his firm last November, and he was not familiar with the details.
Known HDL shareholders include founder and former CEO Tonya Mallory, as well as Robert Bradford Johnson and Floyd Calhoun Dent, the founders of HDL’s former sales contractor, BlueWave Healthcare Consultants.
Upon scheduling the next creditors meeting on Aug. 5, Van Arsdale requested that HDL’s lawyers come prepared to answer specific questions about the distributions.
HDL also recently informed VCU that it will not be able to fulfill the $4 million pledge it made to the school’s athletic department three years ago, the school confirmed this week.
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