Widow bilked: Former Farmington president sued for allegedly stealing $7 million
By Lisa Provence | C-Ville Weekly | December 16, 2016 4:42 PM
When Lynne Kinder’s 41-year-old husband died of a heart attack while riding his bike on New Year’s Eve in 2005, his childhood friend and groomsman in their wedding said he owed it to Trey Kinder to take care of his widow and two young children. She believed him, until discovering earlier this year that the $6.9 million she’d entrusted to Victor M. Dandridge III had shrunk to $735,000, according to court documents.
Kinder filed suit against Dandridge, a local businessman who was the former president of Farmington Country Club, Farmington Property Owners Association and the Virginia Athletics Foundation, November 17 in Richmond Circuit Court.
The suit ensnares a dozen other defendants, including his wife, Ann Claiborne Dandridge, whom the suit contends has an economics degree from UVA and had to know her husband was diverting Kinder’s funds to “line his own pockets and those of his family” and to prop up Timberlake Lighting and the Huntington Learning Center franchises they owned, the latter of which was losing $300,000 to $400,000 a year, according to the complaint.
It also names Dandridge’s father, Victor M. Dandridge Jr., who was a well-known financial adviser with Wall, Patterson in Atlanta; Richard Lloyd Booth, a “close personal friend” of the Dandridges and a managing director and co-chief investment officer with Dallas-based HBK Capital Management, which manages more than $9.7 billion; and Virginia National Bank.
According to the suit, the FBI began an investigation of Dandridge in October.
Dandridge was a partner at Thompson Davis & Company, a private wealth management firm in Richmond, from 2012 until earlier this year, when he resigned after Kinder started seeking documents from the firm, which is also named in the suit.
He helped establish local venture capital firm Tall Oaks Capital Partners LLC in 2000, according to his Thompson Davis profile.
Dandridge managed his own Runnymede Capital Management, which Kinder alleges was an account to pay his personal debts and expenses, and Wycliffe Capital Management and Selwyn Partners LP, which handled multiple clients’ money without Dandridge being licensed with the U.S. Securities and Exchange Commission or the Financial Industry Regulatory Authority, according to the suit.
[Chris Wang with Runnymede Capital Management in New Jersey emails to say his company is in no way connected with this Runnymede.]
Thompson Davis was aware of that lack of registration when it hired him, the suit says, although Dandridge did become licensed when he joined the firm.
Kinder accuses Dandridge of illegally transferring money out of her IRA, which she says “should have raised red flags” with Thompson Davis, but the firm never noticed its employee “was purloining her money,” according to the suit. The early withdrawals caused her to incur tax penalties, she says.
Thompson Davis attorney Bill Bayliss of Williams Mullen did not respond to phone calls from C-VILLE.
Virginia National Bank is named in the suit for providing Dandridge with a $2.7 million line of credit, secured by collateral from his father in early 2014. Kinder claims Dandridge used her money to fraudulently make payments and to clear the line of credit and remove his father’s obligation.
Bank president Glenn Rust did not return phone calls from C-VILLE.
Kinder also alleges Dandridge sold his Farmington house in 2015 and bought a house in Inglecress, which he sold to his friend Booth earlier this year and is now renting it to impede her “ability to unwind the transaction.”
According to Albemarle property records, Dandridge sold the house he bought in 1999 for $812,500 at 2530 Pine Lane for $2,125,000 in 2015. He paid $1.09 million for the house at 1105 Inglecress Drive that same year, and sold it to Booth’s 1105 Inglecress LLC in May for $1.5 million.
Kinder also says Dandridge used her funds to make real estate investments, buying the building at 695 Berkmar Court, the address of Timberlake Lighting and Vitruvian, the LLC that operates the learning centers. She claims he sold the building in 2014 for $1.25 million and didn’t share the proceeds or any rental income with her.
“I don’t have any comment,” says Dandridge when reached by phone.
According to the suit, Trey Kinder became an investment banker in 1997, and at the time of his death was making $2 million a year. He left his wife a $2 million life insurance policy, and $3.3 million in Wachovia stock and stock options.
Within 17 days of his death in January 2006, Dandridge sent Lynne Kinder a letter with an investment portfolio strategy and recommendations, including a “preservation of capital approach” on the $6.5 million portfolio, according to the complaint.
By 2008, she says he was no longer providing statements from the third-party brokerages where he said he’d put her money, and when she asked, Dandridge “continued to assure her that they were doing well,” the suit says.
Kinder made only modest withdrawals from the accounts, but when she did, she had to go through Dandridge, and by 2013, “grew tired of having to make requests to withdraw her own money,” she says in the suit.
With her requests for greater transparency going unanswered, according to her complaint, Kinder drove to Charlottesville on April 7 of this year, and Dandridge presented her with a one-page financial summary that said she had $1,277,536 in liquid assets and $1,407,760 in illiquid investments, a number that included her $1 million house that she’d paid off after her husband died and her $458,000 IRA.
That’s when she sought counsel.
The $6.9 million she’d entrusted to Dandridge had “catastrophically and inexplicably” been depleted to around $1.7 million, the suit alleges, during a time that, she conservatively estimates, based on S&P 500 returns, should have grown to at least $7.3 million. So far, she’s recovered only $735,000.
According to the complaint, “Dandridge admitted that he had both stolen and mismanaged Mrs. Kinder’s assets.”
Among the 13 counts, Kinder is suing for breach of contract and of fiduciary duty, fraud and negligence, and is seeking $9 million in damages.
Her attorney, Mark Krudys, declined to comment beyond the complaint. Dandridge has until January 12 to respond.
Updated December 19.