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Block to Sever Business Ties to Farm Partner

January 24, 1985|Associated Press

WASHINGTON — A spokesman for Agriculture Secretary John Block said today that all financial ties between Block and his financially troubled business partner, Illinois farmer John Curry, are being severed.

Curry has said he would seek bankruptcy protection after a judge appointed a receiver Tuesday to take over all of Curry's farm assets in Iowa.

"The partnership is in the process of being dissolved, but I can't comment further" until the legal process is over, said John Ochs, Block's press secretary.

Curry's lawyer, Barry Barash, said Curry is "selling his interest to the partners because they don't operate effectively together. . . . Every time Curry moves, he moves in the spotlight of Jack Block."

Low-Interest Loan

Part of that public attention stems from a low-interest $400,000 loan to Curry last year by the Farmers Home Administration, which Block oversees. Block insisted that no favoritism was shown and that he did not stand to benefit from the loan. But the matter became an issue during the presidential campaign.

Curry defaulted on the loan earlier this month, but any possible action against him has been forestalled by a suit he filed last November in Peoria, Ill., asking the court to distribute proceeds of his income from 37 Iowa and Missouri farming operations among creditors.

District Court Judge James Jenkins on Tuesday appointed an Ottumwa, Iowa, bank as receiver of Curry's Iowa properties. The action came after the Community Bank of Galesburg, Ill., where Curry lives, said he owed them $731,325 and had publicly stated he would not be able to pay all of his creditors.

Curry has said he hopes to recover and pay off his debts.

Block, an Illinois hog farmer who has partnerships with Curry there and in Minnesota, has denied that his fortunes in any way hinge on what happens to Curry and says he takes no active role in the partnership.

But some of financial arrangements in which both are involved contain "cross-default" provisions that some observers say could subject Block to liability for Curry's losses.

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