Bankrupt businessman Ezri Namvar personally owes at least $321 million to creditors, making his bankruptcy one of the largest in Los Angeles County in recent decades.

That amount, combined with $545 million already known to be owed by his bankrupt real estate investment company, Namco Capital Group Inc., swells the total amount of money owed in Namvar’s financial collapse to at least $866 million.

The information on what Namvar owes comes from a list of the businessman’s personal debts that was prepared by his bankruptcy counsel but has not been filed in court. The list can be found on the Namvar bankruptcy trustee’s Web site.

Bankruptcy experts and local attorneys said they know of no larger personal bankruptcy in Los Angeles County in recent decades, although no one knew of any records that would verify that. However, local corporate bankruptcies, such as Fremont General Corp. and IndyMac Bancorp Inc., were far larger.

“This is as big a local real estate bankruptcy case as I recall,” said J. Scott Bovitz, a bankruptcy law expert with three decades of experience who is also representing a Namco creditor. “I think at the end of the day we are going to discover the amounts are higher – I think it could be a billion-dollar case.”

Namvar is the subject of a federal investigation and has been accused by several creditors of running a Ponzi scheme after his real estate business collapsed.

Namvar raised money in an unusual way. He personally collected it from hundreds of members of his own West L.A. Persian Jewish community, some of whom are now said to be destitute after handing him their life savings. He invested most of it in commercial real estate, including such local trophy assets as the Los Angeles Marriott Downtown hotel; the Wilshire Bundy Plaza office building in West Los Angeles; and the Park Fifth development site downtown, where he and his partners planned to build the tallest condo tower west of Chicago.

His empire, valued at $2.4 billion in mid-2008, collapsed in the real estate downturn in the second half of last year. He and his company were forced into bankruptcy by a group of creditors in December.

Namvar’s list of personal liabilities has not been filed with U.S. Bankruptcy Court, despite an order that it be submitted by March 15 along with the Namco bankruptcy schedules, which were filed. The list has not been signed by Namvar, but it is posted on, a Web site created by the two court-appointed bankruptcy trustees.

R. Todd Neilson, the Namvar trustee, said that the documents were obtained from Howard Grobstein, a forensic accountant hired by Namco as president in February. Grobstein is no longer involved in the matter.

Neilson has not asked the bankruptcy judge to declare Namvar in contempt of court for failing to file the personal schedules. Neilson said that instead his focus has been on finding and cataloging all of Namvar’s assets.

Personal bankruptcy

The documents, dated April 9, indicate that many of Namvar’s largest creditors are banks to which he owes several million dollars each. Many of the banks lent Namvar money to finance real estate deals. A unit of Wells Fargo & Co. is listed as being owed $20.4 million; Marshall Bank is owed $19 million and Town and Country Bank $17.4 million, among several other financial institutions.

Since Namvar borrowed from many individuals, 12 of the 31 creditors listed are individuals or family trusts. One family trust claims it is owed $10.3 million, but most of the debts connected to individuals are less than $2 million. A handful of the individuals are owed less than $100,000, according to the documents.

The largest creditor listed is hotel company Marriott International – the $87 million it is listed as being owed appears to be related to Namvar’s ownership of the 469-room Marriott hotel downtown, which is held by a bankrupt limited liability company that Namvar controls. According to sources, the listing of Marriott is a mistake, and the $87 million is instead related to a large loan the LLC took out with General Electric Capital Corp. to finance the purchase of the property.

Namvar’s bankruptcy counsel, Stephen Biegenzahn, believes that both the Namco and Namvar schedules are inaccurate partly because they contain redundant debts. He also said that many of the debts are tied to the future sales of related pieces of real estate, which could lower what is owed by Namvar.

Because of these factors, Namvar believes that the $545 million and $321 million figures “are both high,” according to Biegenzahn.

Namvar declined to comment directly to the Business Journal.

However, the Business Journal took a conservative approach to evaluating Namvar’s bankruptcy debts by eliminating obvious redundancies. While the documents list 175 Namvar creditors who claim they are owed a total of $565 million, a majority of those claimants also appear on the list of 464 creditors in the Namco bankruptcy schedules. The Business Journal did not add those apparently redundant creditors in the calculation of what Namvar personally owes.

There are 31 creditors named solely in the Namvar documents and their total claims make up the $321 million calculation.

Moving forward

The legal documents list Namvar’s Brentwood home, a 10,300-square-foot, six-bedroom estate, as his largest personal asset with a value of $12.8 million. While the court has allowed Namvar to continue living there, the gated home, which has an elevator, a media room and a swimming pool with a waterfall, has been listed for sale.

Broker Michael Sahakian, who has the $9.5 million listing, declined to comment.

A. David Youssefyeh, an attorney who represents Namvar and Namco creditor Abraham Assil, said that the sale of the home would be “therapeutic” for people who have lost money they entrusted to Namvar.

“They haven’t seen any change in his lifestyle; he is still living in this gigantic house,” he said. “People don’t see him with the common folks.”

It caused a stir when Namvar did not file his personal bankruptcy schedules alongside the Namco documents in March. Some people believed that it meant Namvar was trying to keep information from the court.

“The talk had it that he did not want to swear under the penalty of perjury that these were his assets,” said Benjamin Efraim, a creditor of Namvar and Namco who serves on a Namco creditors committee. “Some people feel he liked to keep things vague and ambiguous so he could deny it or backtrack later.”

However, Biegenzahn, Namvar’s lawyer, said that is not the case. Biegenzahn said he was not satisfied that Namvar’s bankruptcy schedules were complete or accurate because he was not given access to documents at the Namco offices. Because of this, he did not allow Namvar to sign them.

Namvar and Namco creditors have until Nov. 13 to submit their official claims on what they are owed. However, an updated account of what is owed in both bankruptcies may not be available until well into 2010 or perhaps even later. That’s because the trustees’ focus remains on cataloging the assets of Namvar and Namco and not the claims against them.

Experts who called Namvar’s personal bankruptcy among the county’s biggest in decades compared it with a handful of other high-profile Southern California cases. Among those cited in terms of either size or scope included the case of Bruce McNall, the former owner of the Los Angeles Kings hockey team. In McNall’s case, which played out in the mid-1990s, three of his entities had liabilities of $60 million and he admitted to defrauding several banks of $236 million in loans. He later served jail time and was released in 2001.

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