For 20 months while TNT Transport and Logistics Inc. was struggling financially, and before and after it filed for bankruptcy protection in 2020, hundreds of payments totaling nearly $368,000 were made to the owner and his family.
Bankruptcy trustee Howard P. Magaliff says the transactions were fraudulent, in adversary proceedings filed this month against TNT owner Tomy N. Thomas, his wife Madonna and his nephew, Roshan Kuriakose, in U.S. Bankruptcy Court, White Plains.
TNT of New City, Rockland County, is a broker that lines up trucking for customers who are shipping goods. It was founded in 2014.
It booked gross revenue of $653,313 in 2017, according to its Chapter 7 bankruptcy petition, and $816,336 in 2018. But by the end of 2019, it had only $2,985 in cash on hand.
TNT filed for bankruptcy in February 2020, declaring assets of $37,000 and liabilities of $199,208.
From mid-2018 to the end of 2020, TNT had transferred $177,152 to Thomas in 144 transactions, and another $9,135 in seven transfers after bankruptcy was declared.
TNT made 120 transfers totaling $113,870 to Kuriakose, of West Haverstraw, and 20 transfers totaling $67,500 to Thomas’s wife, Madonna.
Magaliff says the transactions were fraudulent because they were made one or two years before bankruptcy when TNT was insolvent; the company became insolvent because of the payments; it had unreasonably small capital to engage in business; it did not receive fair value in exchange for the payments; or it knew it was incurring debts beyond its ability to pay.
Also, Madonna Thomas and Kuriakose were not TNT employees, had no contracts with the company, and provided no services to the company, Magaliff says.
Some of the transfers to Madonna Thomas were payments on a $27,000 loan. But that made her a creditor, according to Magaliff, and as a company insider she was not entitled to preferential payments that would amount to more than she would receive during the bankruptcy process.
Magaliff is asking the court to cancel the transactions and direct the family members to pay back TNT for the benefit of creditors.
He is also challenging a $27,313 claim by PYOD LLC, a Las Vegas debt collector that acquired a loan from On Deck Capital, of Manhattan.
The original $50,000 loan had an annual interest rate of 44.29% and required weekly payments of $1,474.36 for nine months.
New York allows no more than 25% annual interest, according to Magaliff, so the loan was illegal and unenforceable.
A hearing on the trustee’s objection to the claim will be held on March 15.
TNT’s bankruptcy attorney, Robert Lewis, of Nyack, did not respond to a message asking for the company’s side of the story.
