Complaint Review: Financing Alternatives Inc. - Chesapeake Virginia

MICHAEL SHRADER, KURT DINKELACKER, WALTER (WALT) POLLARD, JAVIER PALOMAREZ, STEVE HAMILTON, AND OTHERS IMPLICATED IN FAILURE OF CONSUMER FINANCE COMPANY FINANCING ALTERNATIVES INC. CHESAPEAKE VIRGINIA NEW FACTS REVEAL FINANCING ALTERNATIVES INSIDERS COMPLICITY GREED AND BETRAYAL IN COLLAPSE. COMPETING BUSINESS WAS CREATED BY OFFICERS OF FAI WHILE EMPLOYED BY THE COMPANY DURING ATTORNEY GENERAL INVESTIGATION. STOLEN BUSINESS METHODS AND SECRETS USED TO FORM NEW COMPANY. Financing Alternatives hired Michael J Shrader as CEO in September 2005. Shrader controlled the company from September 2005 until September 2007 decided who to hire and how much to pay, who to ship, how to use the company funds, business plans etc. Kurt Dinkelacker CFO is a personal friend of Shrader, and a former direct report to Shrader at Telespectrum. He was hired by Shrader at FAI for $235,000.00 per year in 2005, soon after they both became "unemployed" from Telespectrum (renamed TRG Solutions after Telespectrum insolvency during their employmemt). Google Kurt Dinkelacker and Michael Shrader. There is plenty to read. In early 2006, after failing to meet sales and revenue projections, Shrader began to intentionally "delay" shipping product by allocating money coming in from customers to other "expenses". This quickly resulted in a backlog of undelivered computers and angry customers. As complaints began to rise, Shrader, Dinkelacker and Walt Pollard concocted a scheme where they mailed a "shipping delay letter" to customers blaming their delay in receiving product on "internal computer upgrades". As evidenced in court documents, this letter (approved and signed by Michael Shrader) was a carefully crafted lie to the unwitting consumers. There were no internal computer upgrades delaying product shipments. This bogus "shipping delay letter" was mailed to thousands of customers through most of 2006. In 2006 and 2007, as revenues continued to slide, an increasingly larger portion of the company's cash was allowed by Shrader and Dinkelacker to be spent on disproportionate salaries for a handful of executives and managers. Meanwhile, these same execs were vigorously eliminating lower level positions, and authorizing further product delivery delays. Ironically, many of those receiving large paychecks were recruited, hired and retained to manage and improve the company's prospects. It is now commonly believed that Shrader and Dinkelacker kept the senior management team intact primarily to benefit of a business similar to FAI now owned anonymously by Shrader and Dinkelacker. In January 2007, Shrader increased his base to $400,000.00 per year, while customers were still not receiving their computers. This 33% salary increase in 2007 would have significantly reduced the number of consumers waiting for a computer. Throughout 2007, Dinkelacker and Shrader provided financial projections to the owner, the Attorney General and others to demonstrate their ability and willingness to overcome serious financial problems created in large part due to their own failed leadership. This "ruse" allowed them, and other corporate insiders, several additional months to collect their large salaries, and furtively cash out their benefits. In the weeks and months before FAI closed, Dinkelacker and Shrader developed a copy cat company, recruited FAI employees, and directed FAI employees to steal trade secrets and copies of FAI computer hard drives. One executive is known to have copied large quantities of corporate information from the company server using a remote connection set up by the IT Director Steve Hamilton (now an executive with the new company). Dinkelacker and Shrader continued to allocate cash to themselves and other members of their "inner circle" through generous salaries and severance agreements that were not routinely offered to other FAI employees. Some of the FAI employees given generous salaries and/or severance followed Dinkelacker and Shrader to the new company. In fact, former FAI employees and officers are also anonymous owners in the new company. Javier Palomarez, poached from a former FAI Strategic Partner MiCash, was hired by Shrader in July 2007 just weeks before FAI was deemed insolvent. Palomarez and Shrader are personal friends and are also believed to be partners in the new company . This cozy relationship may help to explain why Dinkelacker approved Javier Palomarez $200,000.00+ per year salary, even though customers were not receiving computers. Shrader maintained that Palomarez was hired to "develop business for FAI, even though FAI's future prospects were at best questionable. At least $40,000.00 was transferred to Palomarez in the days and weeks before FAI collapsed. If any "new business" was developed for FAI, the company did not benefit from it. Shrader, Dinkelacker, and Palomarez did. One joint venture with ACE CASH EXPRESS was terminated by Shrader and Palomarez resulting in significant financial loss to FAI, while at the exact same time the pair was negotiating with ACE for a significant capital investment in the new company. Another partnership engineered by Palomarez while he was representing FAI, was scheduled to launch October 15 2007 by the new comapny, barely a month after Shrader ,Dinkelacker, Palomarez, and Walt Pollard left FAI. This PAY-O-MATIC relationship was developed months before FAI went out of business, and was not revealed to the Attorney General or the owner. Michael Shrader, Kurt Dinkelacker, Walt Pollard, Javier Palomarez, and Steve Hamilton colluded to maximize their personal gain at a great loss to the consumer, FAI, and to the owner. Unfortunately, there is little interest here in Texas for this story. I believe there may be interest in Virginia, where FAI was headquartered. If you have been harmed by this company, please make sure this posting gets to people who may care. News outlets in Virginia, current and former vendors and business partners, potential investors, etc may appreciate the information and may choose to distance themselves from these dishonest people. Call them, email them, send a carrier pigeon- let your voice be heard. You may never see your money or the computer they promised you, but at least you will know the truth and some more of the unknown facts surrounding the dissolution of a once proud family company. The demise of FAI was no "aw shucks" accident by bumbling inept overpaid executives. The facts point to a failure allowed by shrewd business minds intent on stealing trade secrets they were trusted with. It doesn't get any uglier that that folks. ------------------ Virginia Pilot- [email protected] 757-446-2270 Channel 10 news- Andy Fox- [email protected] ------------------ Michael J Shrader 1276 Southfield Place Virginia Beach VA 23452 757-631-0111 757-214-1177 [email protected] Kurt and Barbara (Miller) Dinkelacker 810 Tristen Way Schwenksville PA 19473 610-287-3419 610-453-8348 [email protected] Javier Palomarez 3405 Courtney Dr Flower Mound, TX 75022 972-355-7616 [email protected] Walter Pollard, now listed as the Director of Business Operations for Evolution Financial Services 1660 Kempsville Road Virginia Beach VA 23464 757-375-3319 757-479-2178 [email protected] Walt also owns shoycomputer.com another FAI copy cat ------------------------------ Devere Kutscher [email protected] Former Director of Marketing and Communications for the National Association of Child Care Resource Now connected to Marketing for Evolution Financial Services -------------------------------------- The new company formed using trade secrets stolen from FAI: Evolution Financial Services LLC 70 Buckwalter Road Suite 900 #425 Royersford PA 19468 800-210-7886 also using americaspurchaseprogram.com ------------------------------- PAY-O-MATIC Secret venture created in early 2007 by FAI execs, never revealed to FAI owner. Relationship moved to new company after FAI dissolves, avoiding non compete and theft of trade secret issues. Ray Mustafa, President PAY-O-MATIC corp. Executive 160 Oak drive Syosset, New York 11791 516-496-4900 Fax 516-496-2282 recently acquired by by: Warren H. Haber, Partner Founders Equity Inc. 711 Fifth Avenue 5th floor New York, NY 10022 212-829-0900 Fax (212) 829-0901 [email protected] fequity.com operating as FEF Cash Inc --------------------- Shrader was involved in investment discussion for raising capital for Evolution Mr. Lee Jundanian CEO RAPID ADVANCE 7316 Wisconsin Avenue Suite 450 Bethesda, MD 20814 Joe Looney, General counsel [email protected] ** previously involved with Blue Hippo, another FAI copy** Barry Davis VP of Business Development 240-514-2000 ext. 121 or [email protected]. --------------------------------- Kurt associate, Potential investor: PIONEER CAPITAL 161 Washington Street, Suite 1060 Conshohocken, PA 19428 610-862-2100 [email protected] -------------------------- Shrader associate, Investor Agents Michael L. Young Chief Operating Officer CEO Capital Group 8630 Fenton St Silver Spring, MD 20910 (703) 418-1111 (301) 495-0108 [email protected] www.ceocapitalgroup.com ------------------------------ Shelby Davis, Vice President Wachovia Bank 101 West Main Street Norfolk VA 23510 Relationship developed at FAI for investment, followed to new company after FAI dissolves. Shelby is a LHR graduate. --------------------- Associates of Javier, partners with FAI shortly before dissolution, True conditon of FAI not revealed to ACE. ACE CASH EXPRESS 1231 Greenway Drive, Suite 600 Irving, TX 75038 (972) 550-5000 (972) 550-5175 (866) 223-2274 [email protected] acecashexpress.com This is a huge company that abhors any negative publicity. FAI execs boasted that ACE was investing in the new business. ------------------------ Kurt Dinkelacker is a Board Member Quench USA LLC (they don't like any press) 780 5th Ave Ste 110 King Of Prussia, Pennsylvania 19406-1437 Phone: 610-277-7472 quenchusa.com ------------------------------ Gladstone Investment Corporation 1521 Westbranch Road Ste 200 McLean, VA 22102 (703) 287-5800 [email protected] This company is very reputable and owns a lot of Quench stock. They have the power to have Kurt removed for integrity issues. -------- MiCash Inc 1101 30th Street NW-Suite 110 Washington, DC 20007 202-338-7474 They probably know by now that Javier Palomarez shafted them when he jumped to Financing Alternatives while negotiating a business arrangement between them and FAI. They probably don't know that he is personally involved in Evolution Financial Services.