County hopes to recover defaulted loan from Front Line

The Webster Progress-Times

County officials say they will continue attempts to recover a defaulted loan from Front Line Apparel Group, which has vacated the plant it was renting in Mathiston.

The company, owned by Ron Levine and Victor Winogradow of Connecticut, owes the county around $350,000 as repayment of two economic development loans. The Webster County Board of Supervisors received grants from the Mississippi Development Authority to fund the loans, which the county is responsible for collecting on behalf of the MDA.

Minutes of a July 14 supervisors meeting state the board received word that collateral was being removed from the FLAG premises in Mathiston. Supervisor Ruthie Salley (District 2), who was an employee of the company at that time, recused herself and the board discussed the matter.

The remaining four supervisors, according to the records, voted to go to the plant on U.S. 82, take self-help repossession of collateral equipment and take it to the Garan building premises in Eupora for storage.

Board President Robert Hitt said county workers began moving machinery out the next day that had loan-related liens and did take the equipment to the Garan building. However, he said they were unable to get all of the equipment and that some of the rest was labeled as county property.

Salley, at another meeting the same day, announced to the board that she had resigned her position at Front Line, according to the minutes.

Hitt confirmed that FLAG has ceased operations in Mathiston and that company executives have since announced they were moving operations to Louisville. He did say that Plant Manager Jerry Riggan told him the company was going to move out equipment it owns outright but would leave the equipment that the county has a lien against. Development District Planner George Crawford said he understood that other equipment the company bought through a loan from the town of Mathiston was also still in the building.

"We're going to do everything we can to get the loan back," Hitt said.

Larry Knotts of Amory, who owns the building in Mathiston that Front Line was leasing, said he sent company officials a termination letter about a month ago but that his attorney has not yet received a signature card verifying receipt. He said they apparently refused his letter and acknowledged that they have since moved out on their own.

The eviction notice was for a number of ongoing problems, said Knotts, including non-payment of the lease.

He said the company also stopped payment on post-dated checks for property taxes that were returned to the county and for which he will now be responsible for paying in addition to late fees. He also said FLAG stopped insurance payments on the building without his knowledge.