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Sunyich Receiver Report 1

Sunyich Receiver Report 1

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Published by: The Salt Lake Tribune on Feb 22, 2013
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02/22/2013

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DMWEST #9617498 v1
 Thomas W. McNamaramcnamarat@ballardspahr.com 655 West Broadway, Suite 1600San Diego, California 92101-8494Telephone: 619-696-9200Facsimile: 619-696-9269
Temporary Receiver 
Edward Chang (NV 11783)change@ballardspahr.com
B
ALLARD
S
PAHR 
LLP
100 North City Parkway, Suite 1750Las Vegas, Nevada 89106-4617Tel.: 702-471-7000Fax: 702-471-7070
 Attorneys for Temporary Receiver 
UNITED STATES DISTRICT COURTDISTRICT OF NEVADAFEDERAL TRADE COMMISSION,Plaintiff,v.IDEAL FINANCIAL SOLUTIONS, INC., acorporation; ASCOT CROSSING, LLC, alimited liability company; BRACKNELLSHORE, LTD., a limited liability company;CHANDON GROUP, INC., a corporation;AVANIX, LLC, a limited liability company;FISCAL FITNESS, LLC, a limited liabilitycompany; STEVEN SUNYICH, individuallyand as an officer and director of the corporatedefendants; MICHAEL SUNYICH, individuallyand as an officer and director of the corporatedefendants; CHRISTOPHER SUNYICH,individually and as an officer and director of thecorporate defendants; SHAWN SUNYICH,individually and as an officer and director of thecorporate defendants; MELISSA SUNYICHGARDNER, individually and as an officer anddirector of the corporate defendants; and KENTBROWN, individually and as an officer anddirector of the corporate defendants.Defendants.
 
2:13-CV-0143-MMD-GWF
PRELIMINARY REPORT OFTEMPORARY RECEIVER 
JUDGE: Hon. Miranda DuCTRM: 4A
Case 2:13-cv-00143-MMD-GWF Document 14 Filed 02/13/13 Page 1 of 21
 
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DMWEST #9617498 v1
i
TABLE OF CONTENTSPage
I. Introduction .................................................................................................................................. 1
II. Receivership Activities ............................................................................................................... 2
A.
Receivership Entities’ Sites ..................................................................................... 2
B.
Financial Accounts of Receivership Entities .......................................................... 3
C.
Cooperation and Interviews .................................................................................... 4
D.
Documents/Information/Electronic Data ................................................................ 4
E.
Forensic Accountants .............................................................................................. 5
F.
Compliance with TRO ............................................................................................ 5
III. Summary of Business Operations ............................................................................................. 5
A.
Background on Ideal ............................................................................................... 6
B.
The Payday Loan Angle .......................................................................................... 7
C.
Recent “Campaigns” ............................................................................................... 9
D.
Individual Defendants and Other Key Players ........................................................ 9
E.
Evidence Found at St. George Site ........................................................................ 16
F.
Merchant Account Manipulation .......................................................................... 17
G.
Can the Business be Conducted Profitably and Lawfully? ................................... 17
H.
Financial ................................................................................................................ 18
 
 
Case 2:13-cv-00143-MMD-GWF Document 14 Filed 02/13/13 Page 2 of 21
 
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DMWEST #9617498 v1
1
PRELIMINARY REPORT OF TEMPORARY RECEIVER I.Introduction
On January 30, 2013, this Court entered a Temporary Restraining Order (“TRO”) whichappointed me, Thomas W. McNamara, Temporary Receiver (“Receiver”), for the businessactivities of the Receivership Entities.Receivership Entities are defined in the TRO (Paragraph II, page 6) as the entities namedas Corporate Defendants (Ideal Financial Solutions, Inc.; Ascot Crossing, LLC; Chandon Group,Inc.; Bracknell Shore, Ltd.; Fiscal Fitness, LLC; Avanix, LLC), plus additional “entities that are part of Defendants’ common enterprise,” including, but not limited to, Debt Elimination Systems,LLC; US Debt Relief, LLC; Money Mastery, LLC; US Debt Assistance Corp.; IWB Services (St.Kitts); Financial Fitness, LLC; Debt to Wealth, LLC (St. Kitts); Debt to Wealth, LLC (Nevada);Ideal Goodness, LLC; Dollars West, LLC; Fluidity, LLC; Newport Sails, LLC; Shaw Shank,LLC; Bunker Hillside, LLC; Funding Guarantee, LLC; Newline Cash, LLC; Wealth Fitness, LLC;and Zeal Funding, LLC.I submit this Preliminary Report to advise the Court of my initial actions and document my preliminary observations. In particular, Section XIV of the TRO specifically directs that I reportto the Court on five specific topics prior to the date set for the hearing to Show Cause regardingthe Preliminary Injunction. As to those topics, I can report as follows:(1)
Steps taken by the Temporary Receiver to implement the terms of this Order.
 I have indefinitely suspended all operations. This was not difficult as we found only fiveemployees on site at the St. George, Utah offices and minimal current business operations.Beginning February 1, 2013, the Receiver’s team and FTC counsel served the TRO on all banksand merchant account providers where Receivership Entities were known to have accounts.(2)-(3)
The value of all Receivership Entities’ liquidated and unliquidated assets.
 Based on financial records we have located to date, we have been able to construct a rough pictureof the Receivership Entities’ financials.
See
the Report of Forensic Accountant, David Birdsell, at///
Case 2:13-cv-00143-MMD-GWF Document 14 Filed 02/13/13 Page 3 of 21

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