NorVergence BK charges Salzano son stealing $1/2 MM
By MARTHA McKAY
The son of the mastermind behind NorVergence, a bankrupt Newark telecommunications firm, allegedly stole close to $500,000 from the company, using the money to pay for drinks, trips to area clubs and for a five-bedroom Glen Ridge house, according to court papers filed Wednesday in U.S. Bankruptcy Court in Newark.
Thomas John Salzano, son of Thomas N. Salzano, the chief managing officer of bankrupt NorVergence, was accused of using two company checks -- one in the amount of $61,200 dated July 1, 2003, and another for $140,000 dated July 29, 2003 – to help pay for "the purchase of his personal residence located at 20 Argyle St., Glen Ridge," the papers said.
The complaint, filed by U.S. Trustee Charles Forman, also alleges that Thomas John Salzano used a NorVergence corporate American Express card to charge "personal expenses, such as outings to bars and clubs, clothing and other personal expenses" unrelated to NorVergence business.
The charges totaling $268,795 were made between November 25, 2002, and March 24, 2004.
Neither Forman nor Salzano could be reached for comment.
NorVergence's abrupt bankruptcy in July 2004, threw 1,300 people out of work and left thousands of small-business customers without phone and Internet service.
Legal battles raged when customers tried to get out of equipment leases that NorVergence had sold to more than 40 banks and leasing companies. In many cases, settlements have been reached, brokered by state attorneys general, providing some relief to deeply angry
Last year, a U.S District Court ordered a $181.7 million default judgment against NorVergence in a case brought by the Federal Trade Commission.
Creditors assert the company owes $550 million.
Thomas John Salzano was never an employee of NorVergence, according to court papers. His father, Thomas N. Salzano, was paid hundreds of thousands of dollars as a consultant. His uncle, Peter J. Salzano, served as CEO.
Thomas John Salzano and his father started a Kenilworth business last year called Charity Snack, which also went belly-up.
The complaint filed Wednesday asks that Salzano repay what he allegedly took, plus punitive damages. In addition, the papers claim that because of his "unlawful misappropriation of [NorVergence's] funds, and fraudulent transfer and unjust enrichment" the house at 20
Argyle St. belongs to the trustee, whose job it is to recover any and all company assets.
The five-bedroom, three-bath home at 20 Argyle St. is listed for sale at $699,000, just reduced, according to a real estate Web site.