Sep. 12--Last Nov. 24, two days before LandAmerica Financial Group went bankrupt, the company refused to release funds it was holding for retired Army Col. Tracy Ralphs of Suffolk.

He was about to close on a land purchase for a new home when he got an e-mail from a LandAmerica executive saying the company no longer was in business.

Ralphs had put $81,666 of proceeds from selling land -- his life savings -- into a LandAmerica account on Oct. 15, just two days before that same LandAmerica official sent an e-mail to the company's chief lawyer warning that the company was about to run out of money to pay customers like him.

And, though LandAmerica wouldn't release Ralphs' funds when promised, the company had on Nov. 12 paid a $200,000 bill from the law firm it consulted about bankruptcy -- the equivalent of five 40-hour weeks of one of the firm's top $995-an-hour lawyers, according to bankruptcy court filings.

"Now, they're talking about paying me 20 cents on the dollar," Ralphs said. He said that is what lawyers involved in the case advised him.

Like others who deposited money with LandAmerica, he believes the company took his money even when its executives knew it couldn't repay it.

In a sworn affidavit, Ralphs said the LandAmerica official who took his deposit told him on the day the Glen Allen firm filed for bankruptcy that one senior LandAmerica official knew as early as June that "this whole thing was going to blow up."

"It was just a Ponzi scheme," said Paul Busse, whose wife deposited money with LandAmerica in August 2008. "They were using money like my wife's to repay other investors."

That is why depositors such as Ralphs and Busse say they will oppose the bankruptcy plan LandAmerica filed this week and will push for legal action to get some of the company's legal and financial advisers to disgorge fees they've already been paid.

They also object to the plan's demand that participating creditors not take legal action against former officers of LandAmerica or the firms that advised the company in bankruptcy.

Ralphs and Busse are among about 400 investors who didn't make special security arrangements for their deposits, and the company's plan says their repayment will come after about 50 investors who did.

Some of those 50 will get 97 percent of their money back, and the rest will split at least $50 million. Anything left over goes toward the 400, who are owed about $193 million.