"...On the other side of the cavernous federal courtroom, a team of lawyers representing Bradley's creditors is painting an altogether different profile of the man they contend is far from broke. They believe that Bradley has stashed assets worth $30 million in the Lazarus Exempt Trust, an entity his sister established with a $1,000 check four years ago, naming Bradley as the primary beneficiary..."
"...Last month, a Travis County family law judge delivered a startling ruling in response to Bradley's request to reduce his $4,000 per month child support payments. Not only did Associate Judge John Hathaway deny the motion, he candidly explained the factor that weighed most heavily in his decision: the mysterious Lazarus Exempt Trust -- the Rubik's Cube of Bradley's bankruptcy that's keeping various lawyers up at night..."
"...But the slow, methodical pace of the trial is apparently the only way to travel in a bankruptcy case that is reviewing dozens of complex business transactions that may or may not hold the key to what attorneys for Bradley's creditors hope to prove that Bradley hid millions of dollars in assets in an exempt trust before the developer filed for Chapter 7 in the summer of 2002...."
"...bankruptcy judge determined in a ruling handed down last week. The judgment is a major victory for creditors, whose lawyers have spent the last two years arguing that Bradley, aided by a small inner ring of associates, went to elaborate lengths to hide multimillion-dollar assets in a trust to avoid paying the nearly $100 million debt he owes to taxpayers and other creditors...."
"...Creditors' lawyers rested their case Tuesday, and Bradley's legal team began calling witnesses, beginning with Gressett and Bradley's sister, Kaye Bradley (formerly Kaye Hulse). Bradley's attorneys, Eric Taube and Ray Battaglia, each elicited testimony that supported Bradley's insistence that he had nothing to do with the formation of the Lazarus Exempt Trust, which his sister created four years ago in his behalf..."
"...Bradley owes the government about $75 million in unpaid loans and more than $5 million in back taxes. Lawyers representing Bradley's creditors theorize that, two years before he filed for bankruptcy, the Austin developer instituted a series of shifty maneuvers to hide his valuable assets in the Lazarus Exempt Trust..."
"...The prevailing theory among those on the opposite side of Bradley's legal and financial battles is that while his personal bank account may be modest, he nevertheless has had ready access to funds through various entities controlled by family members and close friends. A ruling in the bankruptcy case, expected in mid-October, may turn on the mysterious Lazarus Exempt Trust, which Bradley's sister established and controls with Bradley as the sole beneficiary..."
"...Schneider says Simon is in negotiations with Bradley and Brad Beutel, a cousin of Bradley who runs several businesses owned by Lazarus Exempt Trust. The trust is a focal point of Bradley's ongoing bankruptcy proceedings..."
"...Lazarus Exempt Trust: Bradley lists his $270,000 debt to his sister's trust as an "operating expense loan."..."
"...Austin lawyer Eric Taube, who had represented First Gibraltar in both the lawsuit and Gressett's bankruptcy, argued in court that Bradley and Gressett were "playing a lot of shell games," according to news reports. But in an ironic turnabout, Taube is now representing the Lazarus Exempt Trust, the primary target of creditors in Bradley's bankruptcy, and itself widely rumored to be a shell -- with Bradley accused of hiding the pea...."
"...Quote of the Week"We agree that the bankruptcy court did not clearly err in finding that [Gary] Bradley transferred assets to the [Lazarus Exempt] Trust ... and concealed his secret ownership interest in those assets with the intent to defraud his creditors." – Judge James L..."