Merrillville builder target of bank’s complaint
By Teresa Auch Schultz email@example.com June 10, 2014 8:22PM
Updated: July 12, 2014 6:34AM
Centier Bank claims a Merrillville home builder fraudulently misused mortgage funding meant to help build new homes, leaving the bank and his subcontractors open to losses of more than $300,000.
Centier filed a complaint Friday against Ted Doreski, owner of MD Construction, in the U.S. Bankruptcy Court in South Bend, three months after both he and his company filed for bankruptcy.
The complaint claims that Doreski, who lives in Schererville, used money from mortgage agreements he had reached with Centier on nine houses — one each in St. John and Cedar Lake and the rest in Crown Point — to instead pay down other debts he owed.
The money was meant to pay off his subcontractors who helped build the houses, but because Doreski did not pay them as he was supposed to, according to the complaint, they in turn filed liens totalling $319,073 against the houses.
Centier says in the complaint that Doreski, who could not be reached for comment, signed forms promising that all the mortgage payments would go toward the construction costs of the houses. The bank is asking that Doreski’s debt to it not be discharged as part of his bankruptcy cases.
Doreski lists his personal assets at $3.5 million and debts at $9.4 million. MD Construction’s assets, which include the nine houses listed in the Centier complaint, total $2.4 million, and the company lists debts of $9.05 million.