RW Professional Leasing Trial

    by Christopher Menkin

It was on June 21,2002, forty FBI agents raided the offices of RW Professional Leasing in Island Park, NY, on Long Island. Prosecutors said  RW Professional Leasing Corporation concocted elaborate schemes using up to 100 rented mailboxes as far away as California to send phony checks, sham invoices, bogus leases and other false documents to banks in various states. Based on those documents, the banks lent RW millions of dollars to buy equipment and lease it out, prosecutors said.

The schemes included multiple loans from different banks for the same medical equipment and loans for equipment that was never bought or leased, prosecutors said.  It is said it may go higher than $200 million, including the American Express-Sierra Cities portfolio. Vendors, brokers, attorneys, and others are owed money.  There may also be “brokers” and others to be named in the scheme.

One of those arrested later, Payaddi Shivashankar may have pleaded guilty to turn state's evidence, and perhaps another key is Stephen Barker of Lake Forrest, California, who is very well-known both in the medical community and the leasing industry. He may wind up being a key witness in the methode operandi of RW Professional Leasing.

Reportedly, Barker told colleagues what he did to help Barry Drayer with alleged false invoices, cashier checks and mail boxes was part of the routine. He reportedly faces nine counts.  He told his colleagues he did not think he had really done anything wrong. As the story goes, he originally thought when the FBI called him, he thought the interview with them went very well and there was no problem. When was told  that he would arrested, the call from the FBI came in on his "private" cell phone number. It surprised him, he told colleagues.

His operation was doing about $12 million a year, mostly on new practices, and as one of the top five brokers for RW Professional, they handled the payments to vendors and had trust agreements. Accordingly, “every penny” that came in and went out was accounted for. His father Tony, now on a religious mission in South Africa, helped in the book keeping. 

The difficulty appears in the “sale/leaseback” program that RW Professional was marketing, but reportedly did not exist at the level promoted. After the money was disbursed, it was the Drayer operation that places the leases with banks, and according to the charges, sometimes the same lease with several banks, and sometimes the equipment did not exist.  There is evidently also a history with Old Kent, CIT,  Sierra Cities, and American Express that is very similar, according to many sources as reported in Leasing News.

Barker now flies back and forth to New York, spending much time with attorneys and believes he will be found innocent of any involvement that was directed by the Drayers.

Here is the latest from the  Pacer Service Center on what is happening:

“Letter MOTION for Bail as to Dft Barry Drayer - After discussion with AUSA Geoffrey Kaiser, he has agreed to reduce our client's bail to the funds realized by Barry Drayer in his sale, plus the continued pledge of his sons home. That amount should total $627,000.00. Therefore, we request the Court Order that the present mortgage of the govt on the property at 4 Hewins road, Wellesey, MA be discharged upon the sale of the property and that the proceeds be deposited with the govt as continuing security for Mr. Drayer's bail. We request that our client's bail be reduced to $610,000.00, which will be covered by the sale proceeds and Andrew Drayer's residence. In addition, upon the sale of the property we request that Mr. Drayer's pre-trial supervision be transferred to the appropriate pre-trial office which covers Mr. Drayer's new residence at ( *** although a public document, address is being deleted by us. editor) As represented to the Court in prior applications and Court appearances, Mr. Drayer's wife now works for St. John Baptiste Roman Catholic Church in NYC, and Mr. Drayer will be joining her in that apartment. As the court is aware that is the residence in NYC where our client has resided for the last approximately two and one half years. We also request that if the Drayers wish to use the funds deposited with the govt to purchase another residence, that the Court allow said purchase, with the consent of the govt, and the substitution of the new residence as security for Barry Drayer's bail. Filed by Barry Drayer. (Coleman, Laurie) Modified on 6/17/2004 (Coleman, Laurie).”

“ORDER: Pursuant to the Memorandum of Decision & Order of Dist. Judge Spatt the attorney for Roger Drayer and the AUSA are directed to appear before th undersigned on 6/16/2004 at 9:30 AM for an evidentiary hearing on the motion to suppress the post-arrest statement. Said hearing will continue on 6/17/04, if necessary. The attorneys for the defts, Susan Cottrell, Adam Drayer, Roger Drayer, RW Professional Leasing Services Corp. and Rochelle Besser are directed to appear before the undersigned on 6/22/2004 at 9:30 AM for an evidentiary hearing on the motion to suppresss documents obtained by "CS-1". Said hearing will continue day to day until completed. SO ORDERED (Signed by Judge Michael L. Orenstein on 5/4/04) c/m (Montero, Edher)”

“MINUTE ENTRY as to Payaddi Shivashankar (7); Case before Judge Wall on 2/24/04 @ 11:13 a.m., for Criminal Cause for Pleading. Dft Shivashankar present in custody with CJA counsel Edward Jenks. Govt: Geoffrey Kaiser. CD 04-3. Dft enters plea of GUILTY to Count One (of a seven Count) Superseding Indictment. Sentencing set for 6/25/04 @ 9:30 a.m. before Judge Spatt. Dft remains in custody. Magistrate Judge Wall recommends that the District Court accept the guilty plea. (Coleman, Laurie)”

For a full background, please go here or read Press Release

  from U.S. Attorney's Office that follows: