Days after a Hampton Falls, New Hampshire, woman sought permission to subpoena Frederick "Rick" McMenimen's bank records, the former Exeter financial adviser sought Chapter 7 bankruptcy protection, court records show.
The bankruptcy claim essentially halted Susan Wagstaff's lawsuit seeking to recoup $900,000 that she claims McMenimen took from her under the ruse that he was investing the money.
It also stopped legal action connected to another $1.5 million civil judgment against McMenimen for duping his late uncle. The retired Revere public schools administrator bought death benefits that he later learned were worth much less than he was led to believe, according to court records.
He died before the case could be resolved.
Now at least one of those financial disputes — the one by Wagstaff — may be settled by federal prosecutors, who secured a 31-count indictment against McMenimen on charges of money laundering, tax evasion and interstate transportation of goods taken by fraud.
Prosecutors allege that McMenimen, who was arrested Oct. 4, used his reputation as a financial adviser to prey on at least two New Hampshire widows, taking more than $1 million from liquidated insurance annuities and life savings.
McMenimen allegedly put the stolen money into a bank account in Kittery, Maine, federal prosecutors said.
Federal prosecutors allege McMenimen's victims believed their money had been invested, and would provide high-yield returns.
A trustee in bankruptcy court is now asking a judge to issue a subpoena so McMenimen's bank records can be fully examined.
Public records say the money reaped from McMenimen's alleged fraud wasn't his first windfall.
McMenimen, a longtime Exeter High School hockey coach, won $1.4 million from the Tri-State Megabucks in 2005.
After claiming his jackpot, he told the New Hampshire Union Leader, he planned to "put the money in the bank."
"I own a financial planning firm, so I guess I know what to do with it," he added. "Save it."
But despite the jackpot, he continued to find himself in court over a variety of disputes from 2006 until early this year.
In September 2006, McMenimen filed a lawsuit seeking to dissolve a limited liability company that set out to help people sell merchandise online. McMenimen wanted to break free from the business, alleging that his partner "has used company funds to pay himself monies other than wages," according to a court petition.
The lawsuit was ultimately dropped after the partner filed a counterclaim alleging McMenimen decided to stop paying advertising and royalty fees, leaving a balance of $20,000 in unpaid expenses. McMenimen either "paid (the company's) bills late or not at all," his former partner claimed.
McMenimen and his wife also sought restraining orders against two women in November 2006 and March 2008.
The couple claimed that one of the women "has, over a period of time, exhibited an inappropriate attraction" to Frederick McMenimen. Days later, the McMenimens withdrew their request for the order.
In March 2008, Judge Tina Nadeau rejected McMenimen's request to issue a restraining order against a Newfields woman after hearing testimony and examining other evidence submitted in court.
Wagstaff's lawsuit was filed in Rockingham County Superior Court in January, and provided a glimpse of the federal investigation targeting McMenimen.
She said in a sworn affidavit that FBI and IRS agents arrived on her doorstep on Nov. 1 to question her about checks she wrote to McMenimen.
The agents showed her copies of her checks written to his defunct business, and discouraged her from telling McMenimen about their visit, according to court records.
"The agents then asked me not to call Rick after they left because it was a serious investigation," Wagstaff said in her affidavit. "I told them that Rick was as close as family to me and that I was going to call him after they left to ask him what was going on."