07/01/2008 336 STATUS REPORT. Doc 336 extract PART 6
--------------
Court Hearings in this Case
The Receiver attended two hearings held on the issue of Mr. Altomare’s alleged contempt of this Court’s orders and prepared certain analyses of Company financial records for use in that proceeding at the request of the SEC.
Cooperation with various governmental requests
The Receiver has received inquiries for information and records from a number of government entities, including FINRA and other representatives of the SEC, looking into various aspects of the activities of Universal Express. The Receiver has cooperated with all such entities.
Tax Levy
On June 6, 2008, the Receiver learned that the New York State Department of Labor had executed a tax levy for $65,112.97 on the Receiver’s Universal Express bank account resulting from Universal Express’s failure to pay unemployment tax when it was operating in New York from 1994-1999. The Receiver filed an emergency motion to stop the levy in which she contended that the levy was improper as it was made upon Receivership funds and not on Company funds. New York State withdrew the levy on that ground.
Universal Jet
As noted in the Receiver’s first report to the court, in 2007 Universal Express paid $1,211,477.08 to and on behalf of Universal Jet, Inc., a jet charter company located in Boca Raton, Florida. According to both Richard Altomare and Michael McCauley, the principal of Universal Jet, the plan was for Universal Express to acquire Universal Jet. No contract was ever drafted. Whether this funding is considered a loan or an investment, the Receiver has determined that there will be no benefit to the estate of suing Universal Jet, which has its own financial problems, and any judgment would not be collectible. Moreover, according to Mr, McCauley, at least some of Universal Jet’s financial problems were caused by the proposed acquisition, as Altomare caused Universal Jet to make a costly and unnecessary expansion and also failed to pay for a number of private jet flights.
Articles by Accounting Professor
Professor of Accounting Anthony J. Cataldo of West Chester University, West Chester, PA, has done a number of studies, some with colleagues, of Universal Express and other penny stock companies organized under the laws of Nevada. Those articles, some of which have been filed simultaneously with this report, reflect a concern with Nevada’s regulation of corporations organized under its laws, as the Company is. As one example, Nevada allows a public company to have only one Board member. As noted above, Altomare was the only board member of Universal Express. Thus, there was never a disinterested review of his actions. Professor Cataldo also noted that a high number of Nevada penny stock corporations claim to be victims of naked short selling. He also specifically analyzed the use of Universal Express press releases to move the stock price.
Expenses of the Receivership
Attached as Exhibit F is a schedule of funds received and disbursed or incurred since the start of the Receivership.
The sources of these funds were money on deposit in Company bank accounts at the outset of the Receivership, and sales of subsidiaries, furniture, equipment and vehicles. Funds were spent in completing obligations for deliveries for subsidiaries Universal Logistics and Madpackers, maintaining services for shareholders, storage of the Jackson memorabilia and recordings, retrieving and storing the Altomare jewelry, issuing subpoenas, and various ordinary law office expenses.
The entry regarding payments to subcontractors collects payments made to (1) the Company’s Comptroller, who, in the first week of the Receivership, assisted the Receiver in collecting and understanding company records, (2) the Receiver’s IT assistant, who has provided hundreds of hours maintaining the Company’s physical and electronic records, assisting in transferring records to purchasers of the assets of the subsidiaries, selling furniture and equipment, and more, (3) representatives of Madpackers, Inc., who continued to work for the company largely without pay to complete deliveries of possessions for college students returning to campus this fall, and (4) the consultant who analyzed various trading records of Company stock.
Conclusion of the Receiver’s Tasks
The only open issues facing the Receiver with respect to this estate are the Miami-Dade judgments and the Michael Jackson issues. Once these issues are dealt with, the Receiver will seek to close the estate.
Respectfully submitted,
MOSCOWITZ & MOSCOWITZ, P.A.
1111 Brickell Ave., Suite 2050
Miami, Florida 33131
Telephone: (305) 379-8300
Facsimile: (305) 379-4404
Attorneys for Jane W. Moscowitz, Receiver
By: s/Jane W. Moscowitz
JANE W. MOSCOWITZ, ESQ.
Florida Bar No. 586498
Jmoscowitz@mmmpa.com |
