Controversial Treasure Hunter Files for Bankruptcy, Changes His Mind

June 13, 2012

By: John Clark

Investors expecting to reap millions from treasure hunter Tommy Thompson were relieved last month when the controversial figure decided to dismiss his own bankruptcy filing, according to a report from The Columbus Dispatch.

Sources say that Thompson, who received millions of dollars from investors in the late 1980s, had filed for bankruptcy in March, but that his company, Recovery Limited Partnership, decided to dismiss to pull the case out of bankruptcy court in May in order to protect “the interests of all creditors.”

This delighted the numerous investors who funded Thompson’s 1988 excursion to the site of the crash of the SS Central America, which sunk somewhere off the North Carolina coast in 1857 with more than 20 tons of gold on board the ship.

Remarkably, the search was successful, and the treasure hunter reportedly collected roughly $400 million worth of gold from the shipwreck. Thompson, however, allegedly kept all the proceeds to himself.

In 2000, Thompson made his first move to sell some of the gold, as he sold a small portion of the treasure to the California Gold Group for $52 million, but sources indicate that none of this money went to his old investors.

In response, two investors sued Thompson in 2005 in order to get a glimpse into the company’s accounting figures. Legal maneuvers, however, have delayed the case for years, as it has reportedly bounced back and forth between state and federal courts.

In 2008, though, investors tried to have a receiver take control over Recovery Limited and its sister company, Columbus Exploration LLC, but this motion has yet to be accepted by a court.

If a receiver did take over the company, it could either sell the rights to the treasure that Thompson failed to recover or higher another treasure hunter to recover the extra gold that still lies on the bottom of the Atlantic Ocean.

The news is not all bad for investors, who seem to be making slow progress. This January, a federal appellate court upheld a holding by a lower court that held Thompson in contempt for failing to give investors full access to his financial records since 1999.

His company had to pay a fine of $235,000 to its investors after this finding. However, the gold and the money collected from its sale still, in theory, remains out of the hands of investors.

Fortunately for the angry investors, though, Thompson will have to fight them outside of bankruptcy court.