A Richmond woman is lobbing hefty accusations against a Charlottesville businessman who she claims drained millions of dollars from her family after offering to help out in the wake of her husband's untimely death.
In a $9 million lawsuit, Lynne Kinder accuses Albemarle County resident Victor M. Dandridge III of 13 counts of financial misconduct related to his management of the Kinders' assets after the death of Trey Kinder in 2005.
Dandridge, his wife and several other defendants are named in the suit, each tied to a series of actions Dandridge allegedly took between 2007 and 2016 that diminished the Kinder family fortune from $6.9 million to $1.7 million by April 2016.
The FBI launched a criminal investigation into the alleged theft in October, according to the lawsuit, although that could not be confirmed by an FBI spokesperson Tuesday.
The lawsuit further asserts that Dandridge illegally managed the money of other clients for a number of years - a fact allegedly known by CEO William Davis Jr. of the Richmond-based investment advisory firm Thompson Davis, where Dandridge was employed until this past summer.
Attempts to reach Dandridge were unsuccessful. An attorney for Dandridge did not respond to a request for comment on the matter.
Filed in Richmond Circuit Court last month, the suit states that Trey Kinder died unexpectedly of a heart attack on New Year's Eve in 2005 while riding his bike. With Lynne
Kinder thrust into the role of "doing 'everything' on her own" for the family, which included two raising young daughters, Dandridge - Trey's childhood friend and a trusted financial professional - offered to manage the family's financial affairs.
Having grown up with Trey in Roanoke, serving as a groomsman at his wedding and speaking at his funeral, Dandridge told Lynne Kinder the day after her husband's death that he "owed it to Trey" to look after the Kinder family, according to the suit.
Based on the understanding that Dandridge was a financial professional, Kinder entrusted the family's assets to him, including proceeds from a life insurance policy, stocks and stock options worth $6.53 million, with another $400,000 in a retirement account added later.
At the time that Dandridge took over Kinder's assets, he and his wife were allegedly losing hundreds of thousands of dollars annually on the businesses they owned, listed in the lawsuit as Timberlake Lighting, Vitruvian Educational Resources and its affiliated entity VER2 LLC. In order to keep those businesses afloat and "simply to line his own pockets and those of his family," the suit alleges that Dandridge "stole and squandered millions of dollars in Kinder monies."
After taking control of her assets, Kinder alleges that Dandridge deviated from the investments he had proposed to her, transferring $1.4 million into Runny meade Capital Management. While Dandridge allegedly characterized the transfer as an "investment partnership," it was actually just an account he used to pay off personal debts, the suit states.
From there, he continued to transfer Kinder's money to two other entities he owned and controlled - Wycliffe Capital Management and Selwyn Partners LP. All the while, Dandridge continued to lie to Kinder "to further his scheme," according to the lawsuit.
"For example, Dandridge told [Kinder] that certain [...] investments were under performing and that he could obtain better results for her," the suit states. "He recommended that monies invested with these purportedly under performing investments be moved under his management at Runny meade, Wycliffe and Selwyn."
"After the monies were transferred to the forgoing entities," it continues, "Dandridge then funneled the Kinder assets to a joint account that he and [his wife]maintained, and then routed the monies to their failing businesses and for their personal use."
Then, in January 2012, Dandridge became a partner at Thompson Davis, which is listed as a defendant in the suit. The suit alleges that upon entering the firm, Davis the CEO, as well as former and current compliance officers Kevin Rutherford and Walter Young, were all aware that Dandridge had been illegally managing the assets of multiple clients for years, as Dandridge was never registered or licensed to do so by the U.S. Securities and Exchange Commission or the Financial Industry Regulatory Authority.
Before he even began working at Thompson Davis, Dandridge has been investing certain Kinder assets with the firm.
"Defendants Thompson Davis, Davis, Rutherford and Young looked the other way from Dandridge's past and then-current activities and placed no discernible restrictions on outside investment activities," the suit reads.
Bill Bayliss, an attorney for Williams Mullen law firm who is representing Thompson Davis, denied the allegations in a statement.
"The Thompson Davis defendants, including Bill Davis, Walter Young, Kevin Rutherford and Seven Hills, deny any and all allegations of wrongdoing on their behalf and their records reflect that they had only a small amount of Lynne Kinder's money under management and Thompson Davis never took custody of any of these funds while under management at Thompson Davis as these assets were held at Bank of New York Mellon-Pershing," the statement said. "Their records further reflect that they properly managed the funds entrusted to them by Lynne Kinder and when the accounts were closed this summer and the funds were returned to Lynne Kinder the accounts reflected a positive return for their client."
After joining, Dandridge advised Kinder to transfer all of her assets to Thompson Davis, to which Kinder acquiesced, thinking that the additional resources from the firm would only benefit her family's assets. But while Dandridge opened an account for Kinder, he failed to transfer the majority of her assets to Thompson Davis.
Instead, Dandridge opted to transfer "material amounts" of Kinder's assets to Seven Hills Capital Partner LP, which is also named as a defendant in the case; Dandridge and Davis control Seven Hills' partner company.
Over time, Dandridge continued to "divert monies for his own personal uses" and invest her assets through Thompson Davis "in an unsuitable manner, racking up out sized losses," the suit states. He also diverted monies from Kinder's investment retirement account at Thompson Davis, for which Kinder accrued tax penalties - those illegal transfers "should have raised red flags" with Thompson Davis, but none of the defendants from the firm notified Kinder that her money was being taken.
The suit also asserts that Dandridge used Kinder's money to make payments on a $2.7 million line of credit from the Virginia National Bank, which is listed as a defendant in the case. The bank, along with Dandridge's father and Charlottesville financial advisor Richard L. Booth Jr., are implicated in the suit as having taken part in a fraudulent scheme to extinguish the line of credit, which was secured by the elder Dandridge.
Kinder is asking for a jury trial in the multi-million dollar case that is intended to "reclaim for her daughters the bright financial future that her late husband and she worked so hard to provide."