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Monday December 17, 2001 PinnFund/PinnLeasing Deal Gets Judge’s Okay Unicapital Plan Filed with Bankruptcy Court Streamline Sales Tax Project /Delegates Schedule
James Loughton Joins Electronic Financial as VP/Operations MicroFinancial Announces Quarterly Dividend Online Sales Reach $1.5B a Week/Below Expectations, However
Fall Internet World Shows Sedate Side and Why Monday---Odds
and Ends Leasing
News List Tomorrow—Up-dated ### denotes press release ____________________________________________________________________________ PinnFund/PinnLeasing Deal Gets Judge’s Okay By Mike Freeman SAN DIEGO UNION-TRIBUNE STAFF WRITER A federal judge tentatively approved a settlement late Friday that would bring an end to a dramatic phase in the PinnFund USA securities fraud case. U.S. District Judge Marilyn Huff gave investors, who lost $330 million in the scam, until Dec. 30 to file objections to a deal between the Securities and Exchange Commission and James Hillman, a central figure in the case. Oakland resident Hillman was the chief fund-raiser for PinnFund, a Carlsbad mortgage lender. Under the settlement, he would hand over as much as $47 million to investors. Two investors have opposed the settlement because it may make it harder for them to collect a fidelity bond covering their losses. If their issues can be ironed out, the Hillman deal would end the SEC's involvement in the case. "We will be done with our case in nine months, which is record time," said Tom Zaccaro, the lead SEC attorney in the PinnFund case. "The SEC is committed to real-time enforcement of securities laws, which means getting money for investors quickly." On Thursday, SEC officials in Washington, D.C., approved the Hillman settlement. Huff left the door open for investors to challenge the deal after two of them, FITech Domestic Partners and the General Care Foundation for Jewish Cemeteries, opposed it in yesterday's hearing. It remains unclear whether the Hillman settlement would hinder these investors' ability to collect the fidelity bond. Huff is scheduled to discuss the matter with the bond company Monday. "Based upon the investors' objections, the settlement is uncertain," Zaccaro said. "Otherwise, all of the investors who had representatives in the courtroom were overwhelmingly in favor of the settlement." If the deal falls apart, a trial for Hillman is scheduled for Jan. 15. That appears unlikely, said Hillman's attorney, Pamela Naughton of Sheppard Mullin in San Diego. "It's a very good deal for investors," Naughton said. The case now is likely to proceed through bankruptcy court, where authorities aim to track down funds and perhaps pursue accountants and banks in court. Defunct PinnFund, which employed about 200 people in Carlsbad and operated more than 40 offices nationwide, specialized in mortgage loans for borrowers with poor credit. In March, the SEC filed sweeping civil litigation accusing PinnFund chief executive Michael Fanghella, Hillman and related entities of violating securities laws. The SEC case alleged Fanghella used investor money earmarked for mortgage loans to cover $95 million in operating losses at PinnFund over several years, and to pay for his extravagant lifestyle, including the purchase of a $5 million house for an ex-girlfriend. The SEC won a $109 million judgment against Fanghella, who remains behind bars awaiting trial on 20 federal criminal fraud charges. The SEC contended Hillman ignored evidence of fraud and kept vital financial information from investors. Hillman fought the SEC allegations until the settlement. He does not face criminal charges at this time. Under the deal, Hillman has agreed to hand over up to $17 million in cash and to work to liquidate $10 million in partnerships and other investments. He also will seek tax refunds from the Internal Revenue Service that could reach $20 million. The proceeds will be turned over to investors. After the sell-off, Hillman will be left with assets, including his house, worth less than $2 million, authorities said. Despite the deal, investors still lost millions. Before the Hillman settlement, about $15 million to $20 million had been recovered. Ex-PinnFund employees also suffered, losing back pay and benefits in addition to their jobs. Mike Freeman: (760) 476-8209; mike.freeman@uniontrib.com Unicapital Plan Filed Unicapital Corp. filed a Second Amended and Restated Plan of Reorganization and related Disclosure Statement with the U.S. Bankruptcy Court. For more information on Unicapital: www.bankruptcydata.com/BDR.asp?ID=1231 ( If a reader obtains this information and would like to share with us, we would welcome it. editor ) Project and Delegates Schedule Meetings—Streamline Sales Tax Project The Streamlined Sales Tax Project (SSTP or Project) has scheduled its next meeting for Wednesday and Thursday, January 23-24, at the New Orleans Marriott. It is expected to conclude with the Project completing a draft of the Streamlined Sales and Use Tax Agreement ( Agreement ) for presentation to Delegates to the Implementing States the following day. On Friday, January 25, Delegates will begin deliberating the Agreement at the same location. A final vote by Delegates expected by end of summer will sanction the Agreement as model legislation sent to state legislatures. Streamlined Sales Tax Project Meeting The SSTP meeting will be devoted to continuing work on various projects now underway, including definitions, uniform forms and other issues as well as continued development of relevant issue papers. A vote to approve the new lease definition as a provision of the interstate Agreement given Delegates to Implementing States is on the agenda. The Wednesday morning, January 23 session from 8:30 AM until 12 Noon will be a Government-only Combined Work Group session. Sessions will open to the public following lunch on Wednesday afternoon and Thursday morning will be devoted to a series of working group meetings on particular topics. Thursday afternoon will consist of a public project meeting, including a review of activities from the working group sessions and a public comment session expected to adjourn by 3:30 pm. A more detailed agenda is forthcoming. Implementing States Delegates to Implementing States will meet from 8:30 AM until 5 PM on Friday, January 25. Delegates will outline and approve a work plan to begin reviewing issues posed by the interstate Agreement completed the preceding day by the Project. The final authority on the leasing definition and all other aspects of the model legislation will be Implementing States. A specific agenda will be forthcoming. Hotel Both meetings will be held at the New Orleans Marriott located at 555 Canal Street, New Orleans, Louisiana. A block of rooms has been set-aside at the hotel. To make your reservations, call 888/364-1200 and ask for the Streamlined Sales Tax room block. If reservations has difficulty finding the block have them check under Federation of Tax Administrators. The rate is $139 per night plus tax (currently 12 percent plus $3 per room). The cut-off date for making reservations is January 4, 2002. The phone number at the hotel is 504/581-1000; the FAX number is 504/523-6755. Rooms have been blocked for Tuesday through Saturday evening. Registration There will be a registration fee for each of these meetings. The fee for the Streamlined Sales Tax Project meeting is $175; the fee for the Implementing States meeting is $125. The fee includes a continental breakfast, lunch and assorted breaks each day. Persons attending both meetings are required to pay both fees. A registration form is available at the web address shown below. You are encouraged to register (and pay if you wish) online at <http://www.taxexchange.org/meet/0102sales.taf>. Dennis Brown #### ############################### ########################### James Loughton Joins Electronic Financial as VP/Operations Futures Shop’s Former Divisional Manager
of Credit Joins Electronic Financial Group (efgroup) as Vice President,
Operations Vancouver, B.C., Canada –- Electronic Financial Group Ltd. (efgroup)
announced today the
addition of James Loughton to the efgroup team in the capacity of Vice
President, Operations. Mr. Loughton
joins our team with 14 years of consumer and commercial credit operations
experience, most recently with Future Shop Ltd. Mr. Loughton was responsible for the internal consumer and commercial
credit programs at Future Shop, Computer City and Electronics Express,
as well as the management of their third party credit programs. While at Future Shop, Mr. Loughton was responsible
for a fifty-fold increase in purchase sale financing. "Expanding our senior executive team with individuals of Mr. Loughton's
calibre is a reflection of our commitment to build our best in class
business to more effectively service the needs of our dealers, customers,
and funders" said Hugh Swandel, President efgroup. About Electronic Financial
Group Ltd.
At efgroup, our prime focus is to provide the North
American market place with a unique service to enhance sales by providing
instant credit and financing solutions.
Applications are processed and immediate credit decisions granted. Upon approval, documentation and funding is
also completely automated. efgroup
provides comprehensive service, support and training to address customer
issues quickly and efficiently during regular business hours.
efgroup is a privately held company with a recent investment
from Working Opportunity Fund, GrowthWorks Access Fund and Business
Development Band of Canada. (www.efgroup.ca) Contact: Hugh Swandel, President & COO Electronic Financial Group (604) 609-5377 ext 135 ### ########################## ######################## Monday---Odds and Ends Happy Holidays. Thanks for a great year of keeping us all informed with the current world affairs and such. It is greatly appreciated. I hope the New Year brings great things your way. I need your help. I am in need of how to get in touch with some of the people you have indicated that are looking for sales people. Can I forward you a resume or how to I get the job information of the materials you send? Next, I now have a new laptop with a different e-mail, so please send all future correspondence to SMZwelling@aol.com. Thanks again for your help an again wishing you and yours a most beautiful holiday. Stuart Zwelling SMZwelling@aol.com. Please go here and use the e-mail to contact a potential employee. Ask them for a resume, or their telephone number. http://65.209.205.32/LeasingNews/JobPostings.htm I don’t think resumes are like pulling credit and looking for derogatory information, so you can “turn it down,” almost like a processing. I think talking to the person is most important, as a piece of paper really doesn’t tell you the entire story and you may be missing some very good people because you perceive what is on paper is “the person” and their experience and abilities, and as important, potential. You may also want to advertise “Help Wanted.” Both services are free. editor. http://65.209.205.32/LeasingNews/JobPostingsWanted.htm --- “Associations” I landed on your site by accident after an internet search. It's great, and really fills a need.
As a leasing/creditors' rights attorney in Pennsylvania and New Jersey for the past 23 years, I will look forward to being part of this community for a long time.
By the way, have you thought about linking to/from your site from other organizations such as EAEL, ELA, UAEL, or even the Commercial Law League? Lee Herman ( We have the associations, their benefits and dues on line at: When we started, the idea was to have other links, but it changed to non-profit associations who serve the leasing industry. Your question woke me up that we should change the tool bar name from “Links” to “Associations” as there are probably many who do not know we have this information on our website. Thank you for the idea. We will also look into the Commercial Law League. editor ) from the CLLA website, http://www.clla.org The Commercial Law League of America (CLLA) is North America's Leading organization of collections, creditors' rights and bankruptcy professionals. Founded in 1895, the CLLA has nearly 5,000 members in the United States as well as in dozens of countries abroad. Its membership consists of attorneys who concentrate their practice in commercial law, collections, the Uniform Commercial Code and bankruptcy and reorganization. In addition, over 500 individuals who are employed by commercial collection agencies are members. The CLLA is a sponsor of the American Board of Certification (ABC) which is a non-profit organization dedicated to serving the public and improving the quality of the bankruptcy and creditors' rights law bars. The ABC has certified nearly 1,000 attorneys in consumer and business bankruptcy and creditors' rights law nationwide. ____ *** The Great Snow Plow Play **** a personal note... At age 10, I was a Dolphins fan living in Worcester Ma. My parents were of a die-hard Pats generation, that blue collar generation who thought by yelling at the TV they were directly influencing the play Grogan would run. Even my sister (age 11) wrote a letter to the coach that year explaining that the Pats need to make sure they tackle from the waste down as it seemed to be the year of broken tackles. Believe it or not, the coach actually wrote back thanking her (my family has that letter framed at their house and become a novelty to all those who come to visit). So it's safe to say the "Great Snow Plow Play" had an influence on my life. To this day, my folks still give me a call to give me the weather forecast at Foxboro on Pats / Dolphins game day. Happy Holidays to everyone. John Murphy jmurphy@optimussolutions.com Financial Solutions Manager Optimus Solutions LLC 770-349-2152 ____ Jim: Please give me a break on the Patriots sportsmanship issue. Does anyone remember Daryl Stingley, the Patriots receiver that was paralyzed due to an unnecessary hit in a game with the Oakland Raiders? I will not go on and on about other events because Kit, I don't want to turn this into a sporting newsletter, but that one just went through me like a knife. Joe Bonanno ------- Nigerian eMail I am glad that you printed the Nigerian e mail. I think it should be a regular column in the Leasing News. It is so preposterous that this is still going on and the FBI must continue to have Nigerian sections in each of their field offices. What is more preposterous is that U.S. businesspeople, including some in our own industry, falling for these ruses. Keep up the good work. - Steve Steven B. Geller, CLP Leasing Solutions LLC 20 Dike Drive Wesley Hills, New York 10952 845-362-6106 fax 845-354-2803 cell 914-552-0842 _____ http://www.leasingnews.org/Conscious-Top%20Stories/woodley.htm Kit, Thank you for your courage. You have shown a great deal of integrity. Mark Mark A. Coffman mark@chartercapital.com 714.540.2992 562.485.4200 fax ________ http://www.leasingnews.org/Conscious-Top%20Stories/CLP.htm Thanks for an excellent story on CPLC. I have been following them since I started in the business in 1985 at American Funding. There was a lot I knew about them, but a whole lot I didn't. Your reporting skills are unmatched. Keep up the great work! Travis Foxx travisfoxx@merchantcapital.net -- I enjoyed the CPL story very must, being a bit of a history buff myself. Steven B. Geller, CLP Leasing Solutions LLC 20 Dike Drive Wesley Hills, New York 10952 845-362-6106 fax 845-354-2803 cell 914-552-0842 --- Great Article on CPL Kit Two thumbs up Jeff Beier - North American Capital ____ It was a great piece. John Thorne was a good man. Lost in the recap was that Joe Woodley was John's Vice President of Sales and was responsible for bringing in Gordon Roberts, Kevin & Peter Mellon and several other industry stalwarts that are too many to mention. Andrew Thorn athorn@nowlease.com ( I asked many for a quote, or even background, but no response. Bruce Kropschot provided all the public information. After it was printed, I asked for additional information, especially whatever happened to John Thorne. The only one who responded was Pat Roberts. editor ) ---- John Thorne died of cancer. Pat Roberts ------------ Your newsletter is a great help in knowing what's going on in the industry and who's doing what. Keep up the good work. Lee Greif ____________________________________________________________________- #### ################################## ############ ################ MicroFinancial Inc. -MFI- Announces Quarterly Dividend
### ########################### ######################## ############# Online Sales Reach $1.5B a Week/Below Expectations, However By Beth Cox Total online consumer sales in the United States for the week of Dec. 9 were an estimated $1.5 billion, according to Web measurement firm comScore Networks, which claims that its spending estimates are as good as the government's. Reston, Va.-based comScore said its sales figures show "continued strength in hard goods, which turned in record sales of nearly $1.2 billion, a weekly level fully double the benchmark average established in the five months prior to September 2001." comScore also took the opportunity to do a little bragging about its predictive capability, saying that its estimate of e-commerce sales for the third quarter, originally published in the first week of October, is consistent with U.S. Department of Commerce estimates. The company said the toys category last week again led in growth, and consumer electronics, computer hardware and video games each turned in sales levels of more than 100 percent above the average for the year. The online travel category nosed down to approximately $325 million, from $418 million the week before. "We suspect that immediately following Thanksgiving, sales surged as consumers completed travel bookings they had postponed while celebrating the holiday," said Dan Hess, comScore vice president. "By the following week, however, much of this demand had been met and many tickets were sold at sharply reduced prices, dampening the effect of those bookings on total travel dollar sales." "That said," continued Hess, "we're encouraged by the continued strong performance of Hard Goods and expect sales in this sector for the fourth quarter to exceed $10 billion, up 10 percent versus the year-ago period." Unfortunately, that rate of growth is below what many had hoped for. But comScore's figures are in line with the latest figures from Nielsen//NetRatings and Harris Interactive, which show that e-commerce spending in November 2001 jumped only 10 percent from November 2000. Spending rose 14 percent from October to November, half of the 29 percent increase seen in 2000. Meanwhile, accuracy in predicting Web sales would seem to be key if you're in the online measurement business, and comScore said its comparison study shows that it is generating consistent sales estimates, with a difference of only 3 percent from government figures. This government estimate does not include sales of travel services, event tickets, or products purchased via online auction sites, but does include online auction commissions and fees. comScore said that its estimate, issued more than seven weeks prior to the release of the Department of Commerce figures, showed e- commerce sales of $7.240 billion, not including travel services or event tickets but including an estimate for auction fees. The Department of Commerce figures showed e-commerce sales of $7.472 billion for the period. A search on the comScore Web site failed to come up with such a prediction, however. comScore Vice President Daniel E. Hess told InternetNews.com that "we did not publish the third quarter number per se, (although) we were publishing our weekly numbers every week ..." comScore's sales figures are based on the actual, passively captured purchase activity of a representative cross-section of over 1.5 million Internet users, who have given comScore permission to monitor their browsing and buying behavior confidentially using the company's patent-pending technology. Fall Internet World Shows Sedate Side and Why "People are not looking to spend more, but to manage what they have, which we think was one of the appeals that was drawing people to our booth.” By Thor Olavsrud There is no doubt that Internet World Fall in the Jacob K. Javits Center in New York City is a smaller show in 2001 than it was just a year ago; that much is clear from the half-empty conference hall during keynote presentations, an exhibitor floor significantly reduced in size (and with plenty of elbow room), and a press room nearly devoid of reporters. Despite co-location with Streaming Media East 2001, the show has drawn only about 500 exhibitors this year, according to Steven Wright-Mark, president of Schwartz PR Interactive, which represents show producer Penton Media. That number is down from the 1,000 or so exhibitors the show drew last year. "We were here last year and obviously it's much smaller this year, but hopefully this will be the final consolidation of the industry and it will grow back to what it was before," said William Freed, marketing development manager for Digital Island. "This is the core of the industry here. We are looking at it as this is what's left of the industry as the strongest companies remain." As for attendees, there is no official count as of yet. Wright-Mark explained that Penton is one of the only companies that has an independent auditor tabulate attendance to its shows. "We have no count whatsoever how many people we've had going into the show," Wright-Mark told InternetNews.com Thursday morning. However, he said that Penton anticipated about 25,000 attendees based on pre-registrations, down from 36,000 attendees last year, representing an overall 29 percent drop. Unofficial estimates were even lower. Wright-Mark said a number of factors may have contributed to the decline, including the need to reschedule the show from October to November as a result of the events of Sept. 11. "We definitely did lose exhibitors [as a result of the rescheduling], but, interestingly, we did gain some exhibitors as well," Wright-Mark said, adding that Penton received tremendous support from around the world, both for its decision to delay the show and its decision to reschedule rather than canceling altogether. Still, he pointedly noted that the show lost more exhibitors than it gained. The decision to reschedule also brought Internet World together with Streaming Media East 2001, which was already slated for the Javits Center for Dec. 10-14. "We were intending to co-locate in 2002," Wright-Mark said. "It was a little bit quicker than we intended." But while there were hurdles to overcome in integrating the two shows, Wright-Mark said the integration went smoothly. "Overall, the impression is that attendance is way down from prior years," said Eric Maldonado, regional sales manager (New York) for NaviSite. "My expectation was that there would be a few more people here considering it's a combined show." However, Maldonado also noted that despite the decreased attendance the NaviSite booth did brisk business during the first two days of the show, aided in part by the fact that it was able to get a larger booth this year as opposed to the pod in CMGI's booth it occupied last year. "In terms of quality, we've generated a lot of leads but will not know about the real quality of them until after the show, so it's hard to say," he added. In some ways, the tightening budgets of many companies have been a boon in disguise, according to Paul Macchia, manager of North American public relations for Radware. "People are not looking to spend more, but to manage what they have, which we think was one of the appeals that was drawing people to our booth," Macchia said. "We believe our product is good for ROI on a company's network." |