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Harvey Whittemore sued

Discussion in 'General ME/CFS News' started by kravitz, Jan 27, 2012.

  1. kravitz

    kravitz *****

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    Lawsuit claims Harvey Whittemore embezzled millions of dollars from former business partners
    http://www.rgj.com/article/20120127...illions-dollars-from-former-business-partners

    The former business partners of Harvey Whittemore, a well-known Nevada lobbyist, land-developer, businessman and lawyer, filed a civil lawsuit Friday claiming he embezzled millions of dollars from the Wingfield company they ran together and misappropriated corporate funds and assets.

    The suit, filed in Clark County District Court by lawyers for the Wingfield Nevada Group Holding Company, claims that Whittemores Wingfield partners, Thomas Seeno and Albert Seeno Jr., confronted Whittemore in 2010 about numerous discrepancies they found in the Wingfield financial books in 2010, and Whittemore prepared himself a written confession admitting the alleged crimes.

    The suit also names Annette Whittemore, his wife, and The Lakeshore House Limited Partnership.

    Acting as a manger of Wingfield, Whittemore has admitted and confessed to engaging in over 20 different financial transactions designed to deplete Wingfield of its assets for the sole purposes of enhancing and promoting Whittemores financial condition and to further his standing in the political community of Nevada, the suit said.

    These allegations are false, the Whittemores said in an email. We will take any and all steps necessary to preserve the reputation for integrity that we have built in this state for over 40 years.

    Kent Robison, one of the Wingfield lawyers, said in an email that the allegations have been reported to the Reno Police Department.

    Sgt. Dave Macaulay, head of the RPD Financial Crimes unit, said he received a copy of the lawsuit, and said they will review its allegations to determine whether they should investigate to see if there was criminal activity involved.

    The suit demands that Whittemore return the millions of dollars he allegedly stole and seeks compensatory and punitive damages, as well as legal fees and court costs.

    According to the lawsuit, Whittemore and Thomas Seeno executed an operating agreement for Wingfield in 2005, and Whittemore, was made manager.From February of 2007 through 2009, Whittemore exercised complete control over the financial books and records of Wingfield which control he misused and abused, the suit said.

    They amended the agreement in 2009, adding Albert Seeno Jr. as a manager, and adding a stipulation that all expenditures over $5,000 mus have unanimous consent of all three of the managers, the suit said.

    In May 2010, the Seenos started noticing problems in the financial records, specifically, there were concerns about amounts charged to Wingfield accounts, material items not disclosed, debts that were written off, undervalued of liabilities and a number of other expenditures that had not received approval from nor been disclosed to the Seenos, the suit said.

    In September 2010, the Seenos confronted Whittemore, but they quickly learned their suspicions, while well founded, had not even scratched the surface of Whittemores fraud, deception and malfeasance, the suit said.

    Whittemore allegedly wrote a confession on Sept. 16, 2010, admitting a list of inappropriate transactions, the suit said.

    The alleged confession said he embezzled Wingfield money for personal meals, entertainment and endeavors, and used the Wingfield aircraft for improper and unauthorized personal, family and political use.

    Whittemore allegedly admitted using Wingfield funds to maintain and repair his homes in Reno, Las Vegas and Lake Tahoe. He also allegedly diverted company funds to buy or lease vehicles for himself and his family, the suit said.

    The suit said he used the Wingfield-owned Red Hawk golf Course in Sparks to cater a multitude of extravagant, non-company related private parties, family dinners and other family events as well as political and campaign fundraisers.

    One such event, the suit said, was his daughters wedding, that cost Wingfield about $200,000.The suit also claims that Whittemore used company funds for box seats at the Reno Aces games, for private parties, political fundraisers and to benefit his company Whittemore Peterson Institute.
  2. CJB

    CJB Senior Member

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    No kidding. :eek:
  3. Ernie

    Ernie *****

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    It would appear that WPI seems to have many things disappear. Money and maybe records to go along with it. Wonder what else could just disappear? And there is this thing of taxpayer grants. hmmm
  4. Daffodil

    Daffodil Senior Member

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    if it wasnt for the whittemore's, we would be another 20 yrs behind in CFS research. if not for wpi and xmrv, who would care? surely not lipkin or anyone else.
    Kati, justinreilly, ggingues and 5 others like this.
  5. Ernie

    Ernie *****

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    I saw this sample letter where patients can withdraw from the studies.

    January 16th, 2012




    Send E-mail to: info@wpinstitute.org
    cbeisel@niaid.nih.gov
    Christopher E. Beisel Ph.D. NIH Grant Coordinator

    namoody@cdrewu.edu
    Nancy Moody, MA, Human Research Protection, IRB Administrator AHRQ



    Attention NIH Research Grant Coordinator,


    As a participant in the NIH study at the Whittemore Peterson Institute, I am requesting to be removed from the NEW STRATEGIES TO DECIPHER THE PATHOPHYSIOLOGY OF CHRONIC FATIGUE SYNDROME research grant studies. The consent form I signed states I may remove myself at any time and I am choosing to do so now. Please destroy all data and samples that would identify me as a participant to assure my privacy will be protected. Please send a receipt e-mail that you have received this notification and that all actions of removing my information, data and samples have been destroyed. Thank you


    Your Name, Signature
  6. dannybex

    dannybex Senior Member

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    It's not just Harvey that's being sued. Annette's name is all over those documents as well.
  7. ggingues

    ggingues $10 gift code at iHerb GAS343 of $40

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    I think you might be right, hopefully this is all nothing. Our cause needs all the help we can get!

    GG
    Dolphin likes this.
  8. Tia

    Tia Senior Member

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    First Judy's a criminal and now this? Looks to me like someone's framing them. I don't think polititians wants us to get well because if they can have people on disability, depending on the government for survival and buying lots of drugs that go into the great drugcompanies, they make more benefits from us being sick, and therefore they'd rather have us that way.
    taniaaust1 likes this.
  9. Desdinova

    Desdinova Senior Member

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    The small conspiracy voice inside me isn't surprised that something is happening to the whittemores I figured something would be dug up or constructed. I seriously doubt that Annette knew anything if something was going on.
  10. In Vitro Infidelium

    In Vitro Infidelium Guest

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    Here's something to feed the conspiracationists and add frisson for the Whittemore haters - and for anyone just trying to work on reason - it's an excavation of the WPI references in the complaint. It will need a court to expose the truth of this, but the sheer scale of the complaint is astounding and the implications far reaching - 75% of Mikovits salary paid by a private company whose owners didn't know ?! http://cfsmirror.blogspot.com/2012/01/good-science-cant-happen-in-bad.html
  11. Daffodil

    Daffodil Senior Member

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    tia..what drugs do we buy? there are no drugs for us!
  12. Athene

    Athene Never give up

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    If the alleged embezzlement took place in 2009, why are they only suing in 2012? They would have closed the financial books in 2010 and would normally have addressed irregularities back then. It looks to me as if they are digging things up deliberately.... smear campaign?

    Although this is on a particularly big scale, exploiting company assets for personal uses is absolutely rife in business, perhaps universal. I am not saying it is fine, it IS wrong; I am just saying, if you wanted to, you could dig up dirt like this on just about any businessman.
  13. Firestormm

    Firestormm Guest

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    http://cfsmirror.blogspot.com/2012/01/good-science-cant-happen-in-bad.html

    '...Aside from the for profit Redlabs/VIPdx company, the Document of Complaint against Whittemore and others, lists amongst numerous charges of alleged fraud, a number of incidences which directly involve the Whittemore Peterson Institute. These are:

    • Diversion and donations of assets and equipment from a Wingfield called Wild West Sound Company Inc. (renamed Western Electronics Inc.) to (amongst others) the WPI.
    • Diversion of funds disguised as donations to WPI.
    • Improper and abusive use of Wingfield personnel for WPI purposes.
    • Harvey Whittemore caused aircraft leasing costs of over $2 million to accrue to Wingfield accounts in support of private use made by him and Annette Whittemore and others, including travel related to WPI activities which it is claimed alone amounts to $346,546 remains unreimbursed.
    • Annette and Harvey Whittemore directed employees of Wingfield to work on WPI at Wingfields expense, it is specifically alleged that Annette Whittemore represented herself as having management authority at Wingfield.
    • A 'PR' Agency retained by Wingfield was directed to do work for the WPI without any recompense being paid to Wingfield. It I claimed that Wingfields Director of Marketing Angelina Wyss-Gordon [Angelina Gordon] who at the same time was the WPI Director of Marketing and Events http://www.wpinstitute.org/about/about_execboard.html, instructed the Agency that all work carried for WPI should be charged to Wingfield.
    • Harvey Whittemore permitted Annette Whittemore to charge compensation and other employee expenses of the WPI to Wingfield.
    • Specifically Annette Whittemore caused 75% of Dr J.Mikovits salary ($185k) to be charged to Wingfield as was the $42,000 relocation expenses paid to Dr Mikovits.
    • Currently unnumerated expenses of other WPI staff and consultants were paid for by Wingfield.
    • A Wingfield owned company, the Redhawk Golf Course and Entertainment facility was used at the direction of Harvey and Annette Whittemore for fundraising events for the WPI for which fees were not paid, the costs are claimed to exceed $157,000.
    • Harvey Whittemore solicited grants and donations from businesses dealing with Wingfield, which were of benefit to the WPI, but which were undeclared to the owners of Wingfield, to their detriment.


    Should any of these claims be true then huge embarrassment would be attached to the WPI, and by association, the wider cause of M.E/CFS research...'
  14. Firestormm

    Firestormm Guest

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    ScienceInsider - breaking news and analysis from the world of science policy: http://news.sciencemag.org/scienceinsider/2012/01/lawsuit-alleges-misuse-of-funds.html

    Lawsuit Alleges Misuse of Funds by Founders of Whittemore Peterson Institute

    by Jon Cohen on 30 January 2012, 1:18 PM | 0 Comments

    Former business partners of Harvey Whittemore filed a civil suit against him and his wife Annette in Nevada court on 27 January, alleging that the couple inappropriately used the resources of a holding company Harvey co-owned, Wingfield Nevada Group, to support a scientific research institute they founded as well as many personal expenses.

    In documents filed with Clark County District Court in Las Vegas, Nevada, the suit charges that the couple inappropriately spent hundreds of thousands of dollars to support their Whittemore Peterson Institute for Neuro-Immune Disease (WPI) in Reno and its staff salaries, private air flights, and fundraising efforts.

    "These allegations are false," the Whittemores said in a statement. "We will take any and all steps necessary to preserve the reputation for integrity that we have built in this state for over 40 years."

    WPI has been embroiled in controversy since October 2009 when its researchers led a study published in Science that linked chronic fatigue syndrome to a mouse retrovirus.

    WPI fired its head researcher, Judy Mikovits, in September 2011 for insubordination and later filed suit against her for allegedly misappropriating laboratory notebooks and other proprietary information.

    Mikovits later was arrested and jailed in a related criminal case for the alleged theft of these materials.

    Over objections from WPI researchers, Science retracted the report in December 2011.

    The civil case that WPI filed against Mikovits will have its next hearing on 27 February, and the criminal case against her will go to court again on 15 March.
  15. jspotila

    jspotila Senior Member

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    The lawsuit includes multiple allegations that Whittemore deliberately concealed, and ordered other employees to conceal, the misappropriation of money and services. The lawsuit also alleges that Whittemore admitted to doing this when confronted in September 2010, and that the intervening time has been spent trying to identify what happened and get repayment from him.

    Obviously, this is a complaint. It is not a finding by a court of law. Civil litigation, especially on this kind of scale, is a long process. Expect the he said-he said to go on for quite some time as the court discovery process unwinds.

    Edited to add: the allegation that 75% of Mikovits salary was paid by Wingfield is a red flag here. WPI claimed on its IRS 990 that it paid Mikovits a salary of ~185K (I think the year I'm remembering is 2009). If 75% was paid by Wingfield directly to Mikovits, then WPI should not have claimed it on their 990. I'm not sure how accounting standards would require it to be accounted for if Wingfield reimbursed WPI for an amount equal to 75% of the salary. In any event, I'm sure that forensic accountants will be hired by both sides to unravel the paper trail.
    Cort likes this.
  16. liquid sky

    liquid sky Senior Member

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    So now it's the WPI's turn. First Judy, now the private sponsor of the research. That just might scare off anyone who has ambitions to take this research further.

    I think Judy got way too close to something really important. WPI gone. Judy tied up in lawsuits for years. Government has never played fair. What's left? I would like to think the Lipkin study will play fair, but these events are making it really hard to believe.
  17. dannybex

    dannybex Senior Member

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    With all due respect, I don't think this has anything to do with ME/CFS. Whittemore has a long history of "controversial" dealings, as noted on his wiki page.
    Evangelina and Firestormm like this.
  18. Ernie

    Ernie *****

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    Yes and it was most likely Annette got the check from her husband (him being the treasurer) and the money could have been written out of the Wingfield books as going to Mikovits. Doesn't mean anything went directly to her from them. Could be it got deposited into a WPI account then a new check cut so to write it off on taxes. The paper trail will find what happened. Could also be employees were told their checks were coming from one of the various WPI accounts. So people should not speculate what happened. There are a few scenerios that could have.
  19. Athene

    Athene Never give up

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    Oh, now that seems really bad. Definitely NOT a scaled-up version of nicking paperclips and putting a few taxi rides through expenses...
  20. barbc56

    barbc56 Senior Member

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    Huh? The government wants us on disability so we will buy drugs? Many on disability can't afford drugs. Sometimes the copays are even too expensive.
    Dolphin likes this.

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