United States v. James Merrill and Carlos Wanzeler

Retail Consumer Fraud Firm was retained by Counsel for the accused Merrill to assess the government's allegation of a ponzi scheme where it reported"total losses by the victims of about $3,045,000,000" located around the world. We must determine if the characteristics associated with an alleged Ponzi scheme are evident in the nature of the revenue and expense recorded by the company. To assemble the full financial picture, a list of missing financial records from the government's case along with a list of various computer-based analyses that became their basis for the allegations were requested. The requests were necessary in order... Read More...

Confidential Case, Chicago

Retail Financial Advisor Permanent Secrecy Counsel for the plaintiff in Chicago retained me with my involvement subject to a protective order. It had been agreed between Counsel for the plaintiff and the defendant that a forensic accountant, acting on behalf of the plaintiff would be granted access to the financial records of a company related to the defendant. The task was to determine if there was merit to the allegations through the examination of business transactions over a four year period and to report thereon. Upon completion and as instructed, I submitted my report to counsel for the defendant and... Read More...

Sunrider International, Los Angeles, CA

Retail Tax Evasion A ‘yen’ for Asian Antiques Counsel in one of the largest income tax cases in the U.S. involving a privately held international company was required to refute allegations including money laundering and customs violations made by the U.S. government. The investigation focused upon the company’s business activities in Asia. The husband and wife who owned the company were indicted in federal court for conspiracy, tax evasion and smuggling, where it was alleged that they had underreported their 1987-1990 income by more than $125 million. It is essential that the forensic accountant in his financial fact-gathering role identify... Read More...

Windsor, Ontario vs. Detroit, Michigan

Retail Commercial Dispute It’s my tunnel! Who owns the Canadian half of the tunnel? The US Company was formed in 1929 to construct the tunnel with agreement that the Canadian half would revert to Windsor in 60 years. But in 1989, the US Company would not respond. I was retained by Counsel Harvey Strosberg in Windsor. For the case, the paper trail was significant. Until 1980, when Windsor gave its notice of intent to take over its half, one note to the financial statements disclosed the existence of their right. However, after notice, the US Company changed auditors and the... Read More...

Dylex Clothiers

Retail Wrongful Dismissal Who’s at fault for declining profit? With shareholder pressure to increase profits in the sportswear division, a Toronto retail company lured a key individual away from a competitor by offering a lucrative three-year guaranteed deal (void if fraud occurs) of $250,000 per year. To shorten the story, the profits never came, so this new management hire blamed and fired his number two -- who then sued the company for wrongful dismissal. The problem here was simple: whom should the president believe, the former employee or the new hire? Retained by Counsel for the owners, I started by... Read More...

Sunflight And Skylark Tours

Retail Bankruptcy Fraud The Collapse of Two Travel Agencies So you want high profile? Get a court appointment! A government ministry made me a court appointed inspector to examine the business of a travel agency under its legislation and to determine if it was meeting its financial obligations. It becomes an interesting human challenge to extract information from employees whose future is unsure due to your presence. It soon becomes clear that a successful investigator must have strong people skills and a quiet yet firm and respectful presence. Read More...

Windor Meat Packing

Retail Management Fraud Why honest management steals This case, like the previous one, is another lesson learned in understanding why honest people in management steal. There are a number of reasons: To maintain a lifestyle of apparent success Colleagues are stealing and succeeding Feel justified due to unfair compensation Simple greed For survival, either at the personal or corporate level The last is what we have here. The bank is usually the first to probe. Where are the receivables, the inventory, and the cash? For management the questions come from every direction. Well the short answer is they never existed!... Read More...

Regina vs. Carl Rosen and John MacHibroda

Retail Bankruptcy Fraud The accountant took the money! This fraud case involved the planned bankruptcy of Brittany Antiques, which was in the furniture business. These cases are difficult, as one needs to prove that failure was not due to an inexperienced businessman but rather a guilty mind. The concept of “mens rea” is well suited to financial evidence through the effective documentation of patterns of business conduct, which are inconsistent with the normal course of business. It allows prosecution to assert that at a certain point in time, the accused knew or ought to have known that his course of... Read More...

Regina vs. Kotowski

Retail Management Fraud School over-billed; documents destroyed by arson As President, Kotowski operated the Central Fuel Oil Company, which delivered fuel oil to the local high school. For three years he over-billed the school by shutting off the delivery pipe while letting the meter run. Then, before the documents could be seized, the premises of the company were destroyed by arson. While record reconstruction is a challenge, access to third parties usually produces the required relevant documents. That is why I have never been too concerned when people fear document destruction. In this case, an engineer was retained to determine... Read More...

Regina vs. Olan, Hudson and Hartnett

Retail Management Fraud Assets of a Company are used to buy the Company The case involved the purchase by Beauport Holdings of Langley’s Limited, a long established dry cleaning enterprise in Toronto that owned a substantial portfolio of blue chip securities in 1971. Hudson, President and Hartnett, Vice President of Beauport Holdings played the dominant roles aided by Olan who was to receive a finder’s fee for negotiating the sale. To complete the purchase, Beauport Financial received funds from Langley’s that it loaned to Beauport Holdings to complete its purchase of Langley’s. The issue was whether the funds were expended... Read More...

Regina vs. Glenn Turner, Dare To Be Great of Canada Ltd

Retail Consumer Fraud Dare to be Great through a Go-Tour Known for his harelip, Mr. Turner from Florida was the owner, founder and creator of many promotion methods called such names, as “Would I like to better myself?” “Would I like to double my salary?” “Go-Tours” This was my first investigation into pyramid selling. Their marketing plan claimed that for $5,000 one becomes, as they put it, an ‘Independent Sales Agent’ who would receive 40% commission on those persons one enrolls and then 20% commission when their enrollees enroll another person. Marketing involving the sale of the product (which, in... Read More...

Regina vs. Lucas, Lipson and Kendall

Retail Consumer Fraud Lost quarter; Lost trial Sunway Distributing Ltd, a vending machine distributor advertised in newspapers across Canada, offering substantial, guaranteed, spare-time income which could be earned for an investment of only $1,000 to $3,000. In fact, no one made any money. I was in the witness box being cross-examined when in front of the jury defense counsel proceeded to insert a quarter into a machine. The only problem was that he lost his quarter. His eyes moved toward his client; it was a moment of comfort for me and a lesson in courtroom theatre. I recommend to young... Read More...