State targets Omnicity execs

Top officials of a wireless broadband firm that stiffed Jay County for more than $288,000 when the company filed for bankruptcy are now the targets of an administrative complaint filed by the Indiana Securities Division.
Indianapolis Business Journal reported last week that the state is investigating the actions of Omnicity’s former chairman Richard Beltzhoover, former chief executive officer Greg Jarman, and former chief operating officer David A. Bradford.
Omnicity’s assets were purchased out of bankruptcy in December by Broadband Networks Inc. Bradford and Jarman were reportedly retained by the new owner.
Beltzhoover told Indiana Business Journal he was among the victims in the company’s financial dealings, saying he had been forced to file personal bankruptcy in 2011.
“I’ve lost my house and my car and about everything else in my life,” Beltzhoover told the Indianapolis Business Journal. He was removed from the company’s board in 2011.
Omnicity borrowed about $494,500 in Economic Development Income Tax funds from Jay County in 2004. It paid back $150,000 in 2008 and made other small payments but defaulted on $288,071.50.
The only collateral for the EDIT fund loan was equipment that was soon obsolete because of rapidly advancing Internet technology.
Omnicity’s business model was the development of wireless broadband service for rural communities, but investor Richard Reahard told the Indianapolis Business Journal the strategy was to grow through acquisition then sell the company to a larger player.
“You’d get to a certain critical mass and then a big player would be interested in buying you,” he told IBJ. Reahard, Carmel, said he lost about $2.9 million investing in the company.
The Securities Division complaint focuses on an investment by a Blackford County 19-year-old of $100,000 he had inherited from his father.
The division is seeking return of Tanner Byall’s $100,000 investment, $28,000 in promised tax reimbursement since he cashed in his father’s retirement fund to invest in the company, and eight percent interest.
The state also proposes civil penalties against Bradford, Jarman, and Beltzhoover of $10,000 for each of six alleged violations of securities laws, IBJ reported.
Those violations include acting as unregistered brokers, misrepresentation, and fraud.
Broadband Networks Inc. declined to say whether Jarman or Bradford still work for the company.[[In-content Ad]]