The legal saga of former Greater Des Moines businessman John Vratsinas took an uncommon turn this week when a federal bankruptcy court official dropped a fraud complaint after Vratsinas agreed not use the court as a shield against his creditors.
Vratsinas filed a personal bankruptcy case in June 2013 in the U.S. Bankruptcy Court for the Northern District of Iowa in Cedar Rapids in which he cited $6.4 million in debts to unsecured creditors. Under the Chapter 7 case, Vratsinas sought to have the majority of his debts discharged or eliminated.
Since that time, court officials have accused him of trying to mislead them about hidden assets. In a filing on behalf of U.S. Trustee Daniel McDermott in March, Vratsinas was accused of embezzlement, fraud and misleading court officials.
The complaint said Vratsinas concealed assets or the transfer of assets among his various companies and to his personal accounts, and lied under oath during bankruptcy hearings. Read more here.
On July 31, Vratsinas agreed to waive a discharge of his debts if McDermott's complaint were dismissed with prejudice, meaning that it cannot be refiled.
An order dismissing the complaint was filed this week.
The bankruptcy case will proceed with the continued liquidation of assets. The proceeds from those sales will be used to pay Vratsinas' debts on a prorated basis. However, the order means that court officials will not attempt to delve further in Vratsinas' finances.
Vratsinas has rolled through a series of Greater Des Moines businesses, including a construction company and employee services providers that are now defunct. Vratsinas now lives in Chicago, by way of Clear Lake and Minneapolis, but he was a prominent businessman, entrepreneur and investor during his years in Greater Des Moines. His civic involvement was noted when he made the Business Record's Forty Under 40 class of 2004.