A bankruptcy court judge cleared the way for Property Mortgage Co. to ask the U.S. attorney's office to grant three PMC executives temporary immunity from criminal prosecution.
PMC, a Sherman Oaks-based mortgage broker, and its affiliate, SLGH Investments, have been operating under Chapter 11 of the federal bankruptcy laws since Feb. 14, when they suffered a cash squeeze. The companies' reorganizations have left in limbo about $150 million that hundreds of people invested in property and real estate loans through the two companies.
At a bankruptcy court hearing last week, Judge William J. Lasarow in Los Angeles said he would grant PMC's unusual request of asking the U.S. attorney for six months of criminal immunity on behalf of the executives of PMC and SLGH Investments. Lasarow's formal order is expected in about a week.
PMC sought Lasarow's permission because a company operating under Chapter 11 is required to seek the court's approval for any actions outside its normal course of business.
PMC claimed in court papers that the executives' help is necessary for PMC and SLGH to devise reorganization plans, but that the three executives have indicated they might not cooperate unless they get temporary immunity. PMC's lawyers have said they're not aware of any investigation of the individuals currently under way by the U.S. attorney or other authorities. The U.S attorney's office has declined comment.
Lasarow also said he would block certain civil claims that might be filed against the executives for four months provided the executives continued to help with the reorganization. The executives involved are Elliot Fine, PMC's president; his son, Jeffrey Fine, secretary of SLGH, and Stanley Glickman, PMC's vice president.