Mike Farr once rode high as a member of the Detroit Lions. These days, he’s in hot water. Not only does he owe nearly $83,000 in state and federal taxes but, a few weeks ago, federal regulators put a lock on his assets after he was named in a government lawsuit alleging he benefited from fraudulent activities against public pension funds.
The 42-year-old Atlanta resident played wide receiver for the Lions from 1990 to 1992. Now he is the president and CEO of Second Chance Motors, Inc. His father, Mel Farr “Superstar,” was also once a Detroit Lion, and is well known in the auto dealership industry.
Here are the details of Farr’s mounting troubles:
Court records show that on February 3, the state of Michigan filed a lien for $13,658 against Mike Farr and his wife with the Ingham County Register of Deeds. Then, on February 8, the Internal Revenue Service filed a lien against him in Fulton County (GA) Superior Court for $7,364. And on the same day, another lien was filed in the Fulton County court for $61,869 against both Farr and his wife. This is all bad news, but it pales in comparison to his other potential problems.
The Detroit Free Press reported that federal regulators have accused Farr and his friend, Roy Dixon, Jr., of committing fraud related to millions of dollars from pension funds. Dixon – a resident of Michigan and Atlanta – is the founder of Detroit-based Onyx Capital Advisors.
Dixon raised $23.8 million from two pension funds, one in Detroit and the other in Pontiac. The money was a start-up equity fund which, Dixon said, was created to invest in small and medium-sized businesses, mostly in the Midwest.
The Securities and Exchange Commission claims that Farr and Dixon misled administrators of the fund by forging a letter, telling them a highly experienced executive would be working on behalf of Onyx Capital Fund. Reporters from the Detroit Free Press contacted the executive for comment, but were told he had no official role with the fund.
According to the SEC, Onyx Capital Advisors invested $19.7 million of pension fund money with five companies. However, 80 percent of that money – nearly $16 million – was pumped into a Conyers, Georgia-based chain of used car lots and two finance companies – all of which are controlled by Farr.
Another $3 million of the pension funds were allegedly used to pay personal expenses. The federal lawsuit filed by the SEC contends that Dixon used the stolen pension funds to support an extravagant lifestyle, which includes a multi-million dollar Atlanta home, and more than 40 rental units in Detroit and Pontiac. In addition, says the SEC, he used the pension funds to cover overdrafts in his business and personal checking accounts.
U.S. District Judge Denise Page Hood froze the bank accounts and other assets of Farr, Dixon, and Onyx Capital Advisors, and issued a temporary restraining order prohibiting the men from continuing to misuse investor funds. The judge’s order, filed in April, gave the men two business days to give the SEC a list of all accounts at any financial institution. It also prohibited them from destroying related records.