THE DVI FRAUD CONTINUES (says insider)
”What am I missing here, DVI announced that they want to pay retainers to the existing employees on a "discretionary" basis. Lets see - they laid off some 170 employees, many without notice, just a letter in the mail, and cut off the emails without any notice, no severance pay and no Medical benefits - lots of class. If you are liquating a company, do you really need to pay retainers to 170 people? No of course not, that is why they stated "discretionary".
“The people (Rich Miller-President, Steve Jasiukiewicz-VP, Peter Myhre-VP, Joe Melot-VP etc.) who made the decisions to lay off the dedicated and hard working employees are the very people involved in the fraud to the Lenders, Vendors , employees, the Industry and shareholders. Yet, they are still employed , still making the decisions to hurt all the same parties just mentioned. The retainers are just another way to pay Rich Millers inner core people as well as himself, on a discretionary basis of course, to buy time to start up another company and continue their life style.
”How can he get away with this? Well perhaps it is because the Management company that has taken over control of DVI reports to the Board of Directors and the Board of Directors historically has been controlled by Mike O'Hanlon.”
( Name With Held )
(Dear Name With Held, all the leasing companies that filed bankruptcy, the main principals went right back into equipment leasing under another name. CMC is
still winding through bankruptcy, as the class action suit is taking deposition,
and SDI, MCM, you name it, they are active, and so will the DVI officers skate.
Very few go to jail or give up what they have hidden in trusts or given to relatives.
That’s life in the big city, editor.)
DVI, Inc. last week announced that the U.S. Bankruptcy Court granted the Company and
its two debtor subsidiaries interim approval for up to $148 million in
debtor-in-possession financing from Goldman Sachs Credit Partners, L.P. and
Ableco Finance, LLC. The facility will refinance and replace the exiting $20
million DIP facility from Ableco Finance and enable DVI to fund a settlement
with Fleet National Bank and its co-lender under the $150 million Fourth
Amended and Restated Loan Agreement dated March 29, 2002. Pursuant to that
agreement, DVI will pay approximately $100 million to and release all claims
against Fleet and its co-lenders in exchange for a release by Fleet and its
co-lenders of all claims against DVI, resulting in a benefit to DVI of
approximately $50 million. In addition, the new financing will enable DVI to
make investments of up to $20 million in its special purpose vehicle
subsidiaries. It does not settle other lawsuits, or claims against Deloitte,Haskins
DVI Inc. also last week admitted it may have wrongly taken between $2.5 million and $3.5 million for working capital purposes, even though the money should have been remitted to DVI's limited liability companies. DVI further admitted that it never paid some vendors for equipment the company purchased then leased to medical centers. Thirteen noteholders, which hold about $765 million of $1.65 billion of notes and which include companies like Merrill Lynch and Nationwide Life Insurance, have joined to form an unofficial noteholders committee that says it will further investigate some of the recent issues that have surfaced with DVI. Since filing for bankruptcy, DVI has won court approval to increase its post-petition funding by 740 percent to $148 million and to use a replacement debtor-in-possession loan from Goldman Sachs Credit Partners. Ableco Finance LLC to help it pay off a $100 million loan from FleetBoston Financial
Corp. A U.S. Bankruptcy Court has also given DVI permission to sell its assets at an
Oct. 8 auction. Separately, DVI says that as a result of its quarterly review of
reserves held against its loan portfolio, the company is planning a substantial upward
adjustment in its reserves.
Leasing News predicted this company would revert to Chapter 7 and it looks
like that it where it is all headed.