A major creditor of New Century Fabricators has asked the federal bankruptcy court to dismiss the Chapter 11 status of the New Iberia fabrication company, claiming it is incapable of being reorganized.

First Capital also is alleging fraud by owners James Castille and his son Brennan Castille, according to court documents.

First Capital filed for a motion to dismiss — or alternatively convert — New Century Fabricators’ Chapter 11 bankruptcy case at a hearing Thursday.

According to court documents filed Thursday, First Capital alleges the company’s “prior management (unbelievably) proposes itself to be capable of reorganization despite having overseen a massive fraudulent scheme that was designed to and did defraud First Capital (through use of wire and mail fraud, among other things) into lending several million dollars against falsely booked (and non-existent) receivables.”

On May 30, New Century filed under a Chapter 11 bankruptcy, which allows for a business to stay active, provided a receiver or supervisor is appointed and a plan for paying back creditors is approved by the bankruptcy court.

Control of the company, which employed about 250 people, according to Better Business Bureau, has been taken away from CEO James Castille and given to Robert Schleizer, who is currently New Century’s receiver.

“At this time, we will not be releasing any statements regarding New Century Fabricators,” said Schleizer, who refused futher comment.

According to court documents, First Capital alleges New Century — with the consent of First Capital — consulted with BlackBriar Advisors LLC under the direction of Schleizer in December. After a review of New Century’s accounts on April 1, BlackBriar determined a number of repeated irregularities which overstated the size of New Century’s accounts and borrowing base as reported to First Capital.

Phone numbers listed for James Castille were disconnected.

First Capital also alleges that James Castille’s son Brennan Castille directed the New Century billing department, either through email or verbally to create $3.5 million in fraudulent invoices and $1.7 million in fraudulent pre-bills. According to court documents, the receivership order “prevents the Castilles from contacting New Century customers without the express written permission of the receiver.” The documents also state Brennan Castille “continued to access New Century’s accounting records remotely and routinely communicated with New Century employees and customers regarding pricing for prospective work.”

According to court documents, an investigation conducted by CBIZ on behalf of First Capital alleges New Century’s accounts receivable financial records at the beginning of May claimed to be $8.5 million. CBIZ estimates the total value of New Century’s accounts receivable should have been no greater than $4.1 million as of May 9.

New Century’s lawyer David Patrick Keating was unavailable for comment.

First Capital legal counsel asked the court to recognize that a dismissal would be in the best interest of the creditors, and to grant an emergency motion to dismiss, or convert the case to a possible chapter 7 liquidation, according to the motion filed Thursday.

The company’s phone has been disconnected and its website taken offline.

The next hearing is June 25 in bankruptcy court.