The Forum
A judge on Tuesday ordered the founder of defunct Racing Services Inc. to return about $64,000 in company assets.
U.S. Bankruptcy Judge William A. Hill ordered embattled RSI president and convicted felon Susan Bala to return a $50,000 loan to The Guardian Life Insurance Co.
Bala, who awaits federal sentencing for operating an illegal gambling site, used RSI money to buy a $50,000 life insurance policy in 1995. She borrowed against the policy`s full cash value in November, months after her simulcast sports-betting company filed for bankruptcy, Kip Kaler, the bankruptcy trustee representing RSI`s estate, said Tuesday.
Hill also ordered Bala to turn over about $14,000 worth of home furniture that she purchased with RSI funds, court records say.
Bala, 50, attended Tuesday`s hearing without an attorney. She asked that the hearing be postponed, saying she just retained a bankruptcy attorney who could not attend the hearing.
"It was not the position I expected to be in," Bala said.
But Hill ordered the hearing continue.
Kaler`s request to liquidate the assets has been pending since January, Hill said in a one-page order.
"With Ms. Bala`s sentencing scheduled to shortly occur, the court can see no merit in further delay," Hill said.
Bala said she will follow Hill`s order by turning over the loan money and the furniture in her Fargo townhouse.
Kaler said RSI has paid monthly premiums of $655 on Bala`s life insurance policy, totaling about $78,000. The policy`s cash value, however, is about $50,000, he said.
"Sooner or later the policy is going to cease and we`re going to get our cash value out of it," he said.
Bala said she took out the loan to pay attorneys` fees, but hasn`t used the money.
She said her life centers on RSI`s bankruptcy and her approaching sentence hearing in Fargo`s federal court.
"You find yourself unable to focus on anything else," she said.
In February, a federal jury convicted Bala on 12 counts related to running an illegal gambling site in south Fargo. The jury ordered Bala and RSI to forfeit $99 million to the federal government.
Bala has appealed the verdict. Her sentencing is set for April 29.
RSI vice president Raymundo Diaz Jr. pleaded guilty to three charges. His sentencing is set for May 20.
Last Friday, a state district court judge in Fargo dropped related charges against Bala and Diaz.
