07/01/2008 336 STATUS REPORT. Third Report Of The Receiver Of Universal Express, Inc. [Corrected] Document filed by Jane W. Moscowitz. (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Exhibit C, # 4 Exhibit D, # 5 Exhibit E, # 6 Exhibit F)(Moscowitz, Jane) (Entered: 07/01/2008)
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Doc 336
Extract - PART 1
THIRD REPORT OF THE RECEIVER OF UNIVERSAL EXPRESS, INC.
[CORRECTED]
This report covers the activities of the Receiver for Universal Express, Inc. (the “Company”) during the period from November 5, 2007 to the date of the filing of this report on June 24, 2008. The receiver’s prior reports, covering earlier periods are DE# 206 and DE# 237.
Search for Company Assets
Deposition of Richard A. Altomare
On November 12, 2007, the Receiver and counsel took the deposition of Richard A. Altomare in an effort to determine if Mr. Altomare possessed assets of Universal Express, Inc. Mr. Altomare claimed his Fifth Amendment privilege with respect to almost all substantive questions at the deposition. He did not reveal any previously unknown assets of the Company.
The deposition can be found on the Universal Express website and it has been filed with the Court.
Deposition of Barbara Altomare
On November 30, 2007, the Receiver took the deposition of Barbara Altomare, the wife of Richard Altomare. Mrs. Altomare answered more questions than did her husband, but refused to answer a number of questions citing her privilege not to testify against her husband. She asserted her Fifth Amendment privilege regarding the alleged duties she had performed for the company and what business was conducted on a trip taken on a private jet to Las Vegas with children and grandchildren at the time of her sixtieth birthday, all of which was paid for by the Company.
Given this deposition and interviews conducted of former employees of Universal, the Receiver has concluded that Mrs. Altomare did not perform any services for the Company which justified the salary paid to her by the Company.
The deposition is posted on the Company website and has been filed with the Court.
First Capital
On March 11, 2008, the Receiver and counsel took the deposition of Joseph Garrahan, a principal of First Capital Lending, LLC. Mr. Altomare had told the Receiver that Universal Express had at least $250,000 in escrow with First Capital, a venture capital firm which occupied some of Universal’s office space. Moreover, bank records reflect that the Company paid First Capital $363,224 between December 2006 and August 2007.
Garrahan testified that First Capital had worked on a number of potential acquisitions for Universal, mostly of companies which owned gas stations, but none of those deals was ever carried to completion. First Capital received large fees from Universal for its services in those proposed acquisitions. Mr. Garrahan testified that Altomare had authorized him to break the escrow and use those funds to pay amounts owing to First Capital. Notations on some Universal check stubs for funds paid to First Capital tend to support this contention.
Mr. Garrahan also testified that Mr. Altomare has contacted him a number of times since the beginning of the Receivership to seek financing for various ventures but that he has not provided any. Mr. Garrahan testified that Mr. Altomare told him in March 2008 that he had acquired a “European shell” and that he was “looking to back in companies into this shell.” Mr. Altomare had a business plan with him, but Garrahan testified that he did not look at it.
Garrahan produced a personal financial statement of Richard Altomare as of March 2007, which is attached to this Report as Exhibit A. Garrahan also produced the document attached to this report as Exhibit B, a note in Altomare’s handwriting regarding business acquisitions he was apparently engaged in after the Receivership began.
Jewelry
Bank account records of the Company show that between April 13, 2006 and May 16, 2007, the Company paid at least $558,900 to Les Bijoux, a retail jeweler located in Boca Raton.[1]
[1] Altomare has claimed that all funds taken from the Company for personal expenses were accounted for properly and that he was owed these amounts as salary. However, a review of the records sent by the Company Controller to Compupay, which provided payroll services to the Company, shows that it is impossible to determine what the supposed payroll amounts correspond to, as there are merely regular periodic additions to his payroll of even amounts. The W-2 for 2007, which Altomare contends was calculated by the Receiver, was drawn directly from figures supplied by the Company to Compupay before the Receivership began. It shows total salary of $1,700,000, which is more than any authorized or disclosed amount. It should be noted that Mr. Altomare was the only member of the Company’s Board of Directors, and, as such, periodically authorized himself to take raises or bonuses. |
