MERIDEN — The owner of a local oil company that closed its doors in October has filed for bankruptcy under the weight of nearly $3 million in debt, half of it owed to prepaid oil customers.
Jeffrey Doucette, owner of Ace Oil Co. LLC, with offices on High Street, faced creditors Tuesday at a meeting with U.S. Bankruptcy Court Trustee Barbara Katz. The customers with prepaid contracts are from Meriden, Southington, Wallingford, Durham, Middlefield, Middletown and other towns.
“I asked him the questions I knew they wanted answers to,” Katz said.
Katz said Doucette testified under oath that he owed money to terminal operators and that he had not misspent it. He testified that he and his wife, Angela Doucette, only took modest sums, less than $40,000, for an annual salary.
Doucette and his attorney, Ronald Chorches, could not be reached for comment.
Court records show 290 pages of creditors who are owed amounts ranging from several hundred dollars to $425,000 owed to a terminal owner.
Matt Astramowicz, of South Third Street, didn’t want to say how much he was owed, but he said it was significant. He and his wife are retired and “it’s a lot of money for anybody,” he said.
Astramowicz said he prepaid last January for the season and days before he heard that the company was closing a truck came to his house and filled his tank.
“Then I saw it on television and I was shocked,” Astramowicz said. “I’ve been with him for three years and they were fine.”
The state Department of Consumer Protection is conducting its own investigation into Ace Oil with help from the state attorney general. Katz is overseeing the liquidation and conducting a detailed accounting of the company’s books to determine if there are any preferential transfers, payouts to relatives, or any other ways to get cash to creditors.
The city of Meriden is owed $30,500 in back taxes making it a priority secured creditor. The Connecticut Economic Development Fund is also a priority secured creditor, and owed more than $150,000. Tuxis Ohr’s, a local oil supplier, was able to place liens on company assets against a $425,000 debt.
According to court filings, Ace has $52,436 in personal property assets and $3.1 million in liabilities. It reported earnings of $4,030,252 in 2012, but only $3.2 million in 2013, or a $250,000 loss.
Ace Oil’s closing is similar to that of F&S Oil which shut down several years ago, and also left hundreds of prepaid customers in the cold. Katz, who was involved in the F&S proceedings, said there is a different pattern between the two companies. While criminal charges were brought against the heads of F&S, she said, Ace Oil just didn’t appear to be following good business practices.
Assistant Attorney General Brendon Flynn would say only that the investigation is ongoing. If the office uncovers any potential criminal activity, a referral will be made to the state’s attorney’s office, which will decide whether to file charges.
The Department of Consumer Protection notified customers in October of the pending closure and advised customers who prepaid with credit cards to notify their card companies.
Keith Gordon, who is owed an estimated $800, said he heard about the company’s woes from a police officer in North Branford. He immediately contacted his credit card company and got a refund. The $800 represents rollover prepayments from earlier years, he said.
He and other former Ace Oil customers are shopping for new suppliers. Some said they would never prepay again. Others, like Gordon, said they would only do it with a very large, reputable company.
Katz wanted to reassure customers who could not attend Tuesday’s meeting that they didn’t miss out on any possible repayment. But they should be on the lookout for a notice seeking proof of a claim and return it within the time frame given.
Even so she isn’t too hopeful, because the dollars owed to priority and secured creditors probably won’t leave much for unsecured creditors.
“If I can find something I can turn into cash in a meaningful way, I will,” she said.