Kit Menkin's Leasing News Tuesday, June 25, 2002

Accurate, fair and unbiased news for the equipment Leasing Industry




Confirmed Exodus from Amex Biz Finance Medical

HPSC Jumps to 65th Largest On Monitor 100 2002 List

Is Sal Maglietta Still with Citi?

Lease Acceptance Closes Their Doors?

Gamper Gets Green Light

RW Professional Leasing---Ten Months Later

The Gazelle is Back????

Mineta Is 'Confident' On Future Of Amtrak

eLNA Expands Networking Event To Invite Monitor 100 Companies

Jeff Taylor Website Tops in Search Engine Report by MarketLeap

California home prices surge to new highs in May

BBC Reports----US could default on debt


### Denotes Press Release


The Leasing News List—up-dated---Tomorrow




Confirmed Exodus from American Express Business Finance Medical


Here's the real story behind the Amex Exodus. One VP of

Sales, two Top Sales Reps accounting for over $32MM in fundings in 2001, and

two sales associates leave for HPSC. Another top rep and associate will

resign this week, accounting for another $15MM+. All found a new

home in HPSC


Highly Reliable Inside Source-Name With Held




#### #################### #########################


HPSC Jumps to 65th Largest On Monitor 100 2002 List, Reflecting Company's Growth


BOSTON----HPSC, Inc., (AMEX:HDR) announced that The Monitor 100 List, issued this month, now ranks the company as the 65th largest equipment/asset leasing company in the U.S., an increase from its ranking of 77th last year, based upon an 18.4% increase in net assets. The ranking, performed by the independent publication Monitor Daily, reflects growth in net assets. On the ranking of volume of originations, HPSC also ranked 65th this year, an improvement from 75th place last year.

Said John Everets, Chairman and Chief Executive Officer of the company, "We are very pleased with the company's new ranking in the Monitor 100. It demonstrates that our operations are growing strongly, compared to others in the industry, and that we are performing well on the metrics by which our sector is evaluated, namely growth in net assets and origination volume. This improved ranking also reflects the continued hard work of our employees in meeting the needs of our growing customer base."

More information about The Monitor 100 can be obtained by purchasing


Previous Monitor 100 are located here:


About HPSC Inc.

HPSC, Inc. (AMEX:HDR) is a leading non-bank financial services company providing leasing and financing opportunities to the medical and dental professions in all 50 states. Through its asset-backed lending subsidiary, American Commercial Finance Corporation (ACFC), the Company provides asset-backed lines of credit to manufacturing and distribution companies throughout the eastern United States. For more information, the company's website can be accessed at



John Everets, 617-720-3600


### ############################## ####################



Is Sal Maglietta Still with Citi?


I've heard from a good source that Sal Maglietta is no

longer with Citi. I have further heard that he's be

seen at De Lage Landen.


I've also heard that De Lage is about to make

a big announcement about the healthcare market.


Any comments?


please do not list my name.





Lease Acceptance Closes Their Doors?


A very reliable source states Lease Acceptance Corporation in Farmington Hills,Michigan closed their doors for business today... regional manager and sales reps t were given their pink slips today with small severances.






Loud Iron Train RUMBLES

---switch the track now!

Green Light.


---Al Gamper


CIT Prepares for IPO After Being Almost Thrown Off the Track


By Emma Moody and Mark Lake


(complete story, not abridged )



New York (Bloomberg) -- CIT Group Inc. Chief Executive Officer Albert Gamper, pitching the company's planned $5.8 billion stock offering, says Tyco International Ltd.'s ownership of the finance company has left him ``war-scarred.''


Criticism of Tyco, whose accounting is under scrutiny by the Securities and Exchange Commission and whose former chief executive was indicted for tax evasion, has become a centerpiece of Gamper's presentations to potential investors the past 10 days as he tries to persuade them to buy CIT shares from Tyco.


In speeches to more than 400 investors at Manhattan's Pierre Hotel, the Sears Tower in Chicago and on a Webcast to Goldman, Sachs & Co. sales people, the man who has led CIT for 15 years blamed Tyco for his company's low credit ratings, stalled earnings growth and inability to win new business. All of that will be set right once CIT is a standalone company, he said.


``The recent situation is not of our making,'' Gamper told Goldman's sales people in a presentation later distributed to prospective investors. ``It's not my fault and not my problem.''


Tyco is selling 200 million CIT shares at $25 to $29 each, valuing the initial public offering at $5 billion to $5.8 billion. At the high end of the range, CIT's IPO would be the third-largest in the U.S., at the low end, the fourth-largest. Goldman and Lehman Brothers Holdings Inc. are managing the sale.


Gary Holmes, a spokesman for Tyco, declined to respond to Gamper's comments. Tyco shares fell 5 cents to $13.65 in midmorning trading.


Sluggish Growth


Gamper is trying to prove to investors that the company is worth buying again, even though CIT, which leases airplanes and trains, finances telecommunications companies and provides home equity loans, isn't likely increase earnings this year and is likely to suffer from high borrowing costs for the next three quarters.


``I'm struggling to get excited about it,'' said Jeff Parker, who manages the $1.3 billion Pimco Target Fund.


Shortly after bounding through the Pierre Hotel's crowded ballroom at lunchtime on Friday, Gamper stepped onto the podium to give the assembled investors his pitch. ``Someone said to me on the way in that you are all Tyco shareholders in need of a free lunch,'' he said, alluding to Tyco's share price, down 77 percent this year.


The jibe underscores how tensions have grown between Gamper and Tyco executives since the plan to sell the unit was announced in January. Gamper stepped up his efforts to put distance between CIT and its parent after former Tyco CEO Dennis Kozlowski was indicted earlier this month for allegedly evading $1 million in New York taxes. Tyco paid $9.5 billion for CIT 12 months ago.


Gamper ``made it clear that he was not pleased with what had happened at the corporate level at Tyco,'' said Andrew Flynn, a portfolio manager at Northern Trust Corp. who attended CIT's presentation in Chicago last week. ``He's clearly looking forward to when the IPO is done.''


Betting on Turnaround


Under the stewardship of Tyco, CIT recorded its first-ever net loss. The finance company took a $4.5 billion charge to reflect the reduction in its value since Tyco bought it last year. A further write down of more than $1 billion is likely, CIT Chief Financial Officer Joseph Leone told the investors at the Pierre.


Founded in 1908, CIT was the first company to offer financing to help people buy Studebaker cars early last century. It remained independent until 1980. Since then, Livingston, New Jersey-based CIT has been owned by RCA Corp., Manufacturers Hanover Corp. and Japan's Dai-Ichi Kangyo Bank before being sold to the public in 1997 and bought by Tyco in 2001.


The executives are betting on a turnaround once CIT is an independent company. To help allay investor concerns about CIT's links to Tyco, Gamper will be the only CIT executive on the board. Management also will receive bonuses in stock to conserve cash.


Leone said he's expecting credit ratings to be raised as soon as the IPO occurs and is already planning to sell more than $4 billion in debt.


Lower Rating


Standard & Poor's and Fitch Inc. in February cut the ``A-1'' credit rating on CIT's commercial paper, which matures in nine months or less. That prevented the company from selling the obligations, which are among the cheapest forms of corporate borrowing. The credit ratings companies cited high debts and dwindling cash at Tyco, rather than CIT, for the downgrades.


The lower credit rating has caused CIT's borrowing costs to surge in part because it has reduced the number of borrowing options available, said Leone.


CIT sold five-year notes in April to yield 265 basis points more than U.S. Treasury securities with comparable maturities. A year ago, CIT sold five-year bonds to yield 169 basis points more than benchmark government debt. A basis point is 0.01 percentage point.


Selling New Debt


Because borrowing costs won't decline immediately, they will weigh on earnings for the next three quarters, Leone said.


CIT plans to sell as much as $4 billion of commercial paper by the end of the year, and may increase that to $5 billion in 2003, he said. CIT also will sell fixed- or floating-rate debt with longer maturities of about three years, CIT told investors.


``If you have confidence that they can get a rating upgrade, then you'd probably buy the stock,'' said Pimco's Parker. ``If not, then you wouldn't.''


Tyco's ownership of CIT, and concern about when and if Tyco would be able to sell the finance unit, led some customers to balk at signing long-term contracts, and the finance company has been unable to seek new business, Gamper said. Tyco said Jan. 22 that it would sell CIT either to the public or through a private sale as part of a plan to split Tyco into four companies. Then-CEO Kozlowski dropped the plan to break up Tyco in April.


The slowdown in new business is ``disturbing,'' Gamper said.


``There is some reluctance to do business with us in this environment,'' he said. ``That will change once we have independence and our ownership is sorted out.''




RW Professional Leasing---Ten Months Later


by Christopher Menkin


June 21,2002, forty FBI agents raided the offices of RW Professional Leasing in Island Park, NY, on Long Island. Those arrested were RW's president and co-owner, Rochelle Drayer Besser, also known as Rochelle Drayer, 66, of Long Beach, California; her brother, RW's senior vice president, Barry Drayer, 62, who operated a branch in Wellesley, Mass.(reportedly the defacto CEO); another brother, Roger Drayer, 59, of Long Beach, who holds various titles, operating a small office in California; and Roger Drayer's daughter, Jennifer Tarantino, also known as Jennifer Drayer, 31, of Oceanside, California.


Not arrested was Rochelle Drayer Besser's husband, Wallace, who reportedly has been ill for the past three years and has not really been active in the business since 1996, so that probably explains why he was not arrested. However, he was named as a defendant in a lawsuit filed on Tuesday, June 18th by a consortium of community banks. and arrested Barry Drayer and Rochelle Drayer Besser, Roger and Jennifer Drayer.


An unconfirmed report has Barry Drayer on a “suicide watch,” as it appears

there may be others to be named in the conspiracy. There is a waiting

list who would like to “interview” Barry Drayer, who has been able

to talk himself out of trouble in the past.


So far the investigation has found $6.5 Million of outright fraud with a lot of hard evidence.


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.


Leasing News has been writing about RW Professional for ten months:


(8/2001) "A high ranking executive with Amex has verified that Amex is investigating possible problems with the portfolios of RW Professional Leasing...

"(9/2001)“-Interview with Charlie Lester. First, who is he?


After a 19 year sales and management career with IBM, Charlie settled in Atlanta and somehow got into the leasing business in 1984. In 1986, he founded Lease Pro, Inc. and operated it as a medical niche broker until 1997 when First Sierra Financial acquired most of its assets. The remaining assets were assigned to LPI Financial Services as a new corporate entity.

“-After his two-year contract was honored, he resigned and sat out his non-compete period before expanding LPI Financial into a niche broker offering working capital loans to medical professionals.”

To understand what went wrong, you need to understand how discounting a lease

and a private label program works.

Discounting leasing is when you have a lease contract with your name on it and

discount the stream of payments to a buyer ( bank, funder, syndicator) ( you may

or may not keep the residual and may discount it too, meaning present value the

stream of payments and the residual, too ). You get paid up-front, instead of the

difference between the monthly interest earned and paid. It may be recourse

or non-recourse, but it certainly will have “representations and warrants.”

Sierra Cities bought many discounters local operations and combined them

into one, calling it a Private Label Program. They offered the ability to

continue to discount plus to accumulate leases and syndicate them to the

public for a better rate of return; a better margin and more liberal credit

policy. Westinghouse, CIT, Heller, Textron, and of course, GE also

have private label programs, but Sierra Cities carried the Colonial Pacific

Pegasus program one step further. In fact, this division was making

a $20 million annual profit from its inception. What made it so successful:

Oren Hall, Mark McQuitty, Jim Raeder, Charlie Lester, Fred Van Etten,

Mike Wing and others were in leadership capacity

What went wrong?

LN. I think you should explain what the Sierra Cities private broker program

worked to understand RW Professional Leasing as a Private Label Recourse broker.

GC. A Private Label Recourse broker has a contract with a funding source to buy deals at a buy rate 150-250 basis points lower then their non-recourse brokers. In return, the recourse broker is responsible for the collection of all monthly payments and in the event of default, to repurchase the entire lease contract. The recourse broker may also receive an even lower buy rate for handling all personal property and sales taxes.


( somehow the arrangement right before the acquistion by American Express

went from recourse to non-recourse, it is reported. )


---- this is only partial of the first of a three part interview explaining how

the private label program works, now assembled here-----


(9/2001)Open Question for American Express Business Finance "Based on extremely reliable insider information, Leasing News has been told that a former First Sierra employee would be agreeable to "give up" Depping in return for a lawsuit settlement with American Express. The question is, "Does American Express want Thomas Depping to ‘answer’ for actions he may or may not have taken?" (In reality, American Express settled with this person, Fred Van Etten,

who obviously has signed an agreement not to talk publicly.)



Another individual known to Leasing News who did not want to be named says he was employed by Sierra Cities, came into Houston for a meeting, and at a Chinese Restaurant with Fred Van Etten, Greg McIntosh, Jim Raeder and perhaps two other people, one of whom might have been Tom Depping, when the conversation of RW Professional came up. ( He specifically he did not remember

if Depping was there, but he believed Depping was aware of the Old Kent Financial deal with Barry Drayer. By the way, this person is a regular reader

of Leasing News. ).

He told the gathering he knew the company as Professional Leasing, who did

a lot of dental business, when he was at the Vanguard Division of Old Kent

Bank for eleven years, this person ripped them off for between $6 million to $10 million. Why should Sierra Cities do business with them? he asked. He was told Sierra Cities had the company and personal guarantee---and it was recourse, so Sierra Cities was allegedly protected. ( Now the case with American Express Business Finance centers on “what happened to the recourse agreement?” and was stock involved in the “arrangement?” What does Greg McIntosh know? ( He says

he knows nothing. Editor) Will Fred Van Etten talk? ( Not today?) Will Jim Raeder speak publicly why he was let go at Sierra Cities? P.S. It wasn’t about Republic Leasing. The spin doctors may have put that out, but Fred Van Etten and Jim Raeder were let go for the same reason. (Leasing News revealed some of it in Mark McQuitty’s “Whatever Happened to Republic Leasing of Anaheim. Editor).What did Oren Hall know?( Reached at his residence, he said he was retired and didn’t want to make any comment?) Will Charlie Lester write the entire story for Leasing News, naming names, places, dates? (Perhaps we should have Charlie Lester on “Meet the Leasing News Maker.”)Did it center around the Private Label Program and RW Professional? Is that why Leasing News spent three days defining private label recourse and non-recourse? Does the leasing public have the right to know to protect themselves in the future? Perhaps from a legal standpoint, do stockholders have the right to know the truth? Is fraud involved. ) How did RW allegedly get away with it with Vanguard? (He made a deal.)

Here is a ethics question for readers who are funders:

Broker calls up funding source and says, "How did you like the way I screwed

you over for $10,000,000. Was it as good for you as it was for me? Well, I

thought it was fun and now you have a decision to make---do you put me in

jail and get nothing or will you settle for $3,000,000 and give me a clean

bill of health, so I can go back to business as usual?"


To all the funding sources, what would your answer be?


(None of the funding sources responded, as they knew they would most

likely take the money. Editor )


If your company policy is to prosecute, how many fraudulent brokers, vendors or lessees have you brought criminal charges against in the past five years?



(Two people formerly at Old Kent Financial can now talk about this as

there was an order signed that employees could not talk about this, but

since the company is no longer in business, neither is the agreement. Editor )


( The answer to the question: Old Kent Financial took the deal---and is reported American Leasing Express did the same thing. Not illegal, but there are many community banks and individual lessees who wish the deals had not been made. Editor )


(9/2001) Charlie Lester American Express and Private Label Programs.


.(10/02)RW Professional starts suit against Leasing News for stories written

(around this time the affects of the 9-11 tragedy affected American Express,

as well as others, as well as the legal action taken by RW Professional, although

we were still collecting background information and working on several stories.)


10/2001) . There was a settlement made between Barry Drayer

and Old Kent for a situation very similar to the latest situation, except

in this case, Old Kent for a lower dollar amount “forgave” the situation.


For the first time, we publish this e-mail:


“I was the one who originally found the fraud when I was the litigation manager for Old Kent. I was not involved in the final settlement but I know how it was done and their attorney's can try to do their best to save the name of RW Professional Leasing but there efforts will be fruitless.


“If anyone ever called me to do business with RW or their

principals I would have no problem advising them to stay away. It's poor

business people like them that give brokers a lousy name in this industry.

A lot of lenders lost a lot of money because of their scam and in turn cut off

all their brokers as a result. They need to get out of the leasing industry.


“That is just my opinion.”


Regards, Susan M. Adamatis


10/2002) Practical Ethics---If Crime is Not punished, Does it Cease to be a Crime?



Special Report


Written by Kit Menkin and Charlie Lester


If a tree falls on a desert island, does it make a sound when it falls?


This is an old college question, and many of us had fun trying to

justify our answer.


Does fraud exist, if it never is prosecuted? If crime is never punished,

does it cease to be a crime? When do we hear the sound of a tree,

if we are not there?

On September 4, 2001, Leasing News began publishing question and answer articles with Charlie Lester, President of LPI Financial, Atlanta, Georgia, formerly President of Lease Pro, who sold his company to Sierra Cities in 1997. Charlie is also the senior member of the Leasing News Advisory Board. The three day interviews concerned private label recourse programs, the procedures, the process, the pros and cons, and is available on-line at:


On September 7, 2001, we asked:


Open Question for American Express Business Finance



"Based on extremely reliable insider information, Leasing News has been told that a former First Sierra employee would be agreeable to "give up" Depping in return for a lawsuit settlement with American Express.


“The question is, ‘Does American Express have reason to want Thomas Depping to “answer” for actions he may or may not have taken?’"

Those at the Chinese restaurant meeting heard about Professional Leasing, who did a lot of dental business when he was at the Vanguard Division of Old Kent

Bank for eleven years. He said this company ripped them off for between $6 million to $10 million. He asked, “Why should Sierra Cities do business with them?” He was told Sierra Cities had the corporate and personal guarantees---and it was recourse, so Sierra Cities was supposedly protected.


Now, the situation with American Express Business Finance centers on “what happened to the recourse agreement and the personal guarantee?” and was stock involved in any “arrangement?” they can protect themselves in the future? Perhaps from a legal standpoint, do American Express stockholders have the right to know the truth if American Express paid too much for Sierra Cities due to hidden problems”. Did American Express fail in their job of due diligence before acquiring Sierra Cities and did they cost their stockholders millions?


We have been asking these questions.


. (2/2002) American Express Business Finance Major Loss?

(Would one of the portfolio letters be “R”? )

A well informed source tells Leasing News that one of the portfolio’s sold to American Express by First Sierra has a loss of $16 million now. This is getting large enough to be footnoted in the Security Exchange report.



(2/2002) Finance Team of America, Weston, Florida informs RW Professional

they will not longer be referring business. “FTA has serious concerns regarding Professional Leasing’s business practices. We have attempted for the last five months to get straight answers in regards to our transactions( customers) that are in funding as well as delays in credit review and structures.


“In addition, our commissions are well past due for months now and we have tried to work with your company on a payment plan for the past due amounts that add up to a six figure sum...Many doctors are being billed without receiving their funds and some are asking questions about the description and structure of their transaction on their monthly statement; vendors have not been paid up delivery, Financial Institutions have not been paid regarding payoffs and Sub-Broker’s commissions have not been paid due to PLS not funding Finance Team of America its commissions due.”




I am getting complaints that RW Professional is not making payments

on leases, the bank they assigned leases to is now asking

them for payments direct, stating that RW Professional is not

paying them.


I am told the New York State Banking Investigator is looking into



I am not going to pass this around the entire board; however,

the bank involved is Blue Stem Bank in New York.

Was that the bank you had been talking to who had leases

with RW Financial?




“He also says that he filed a complaint with the FBI in Albany and they have bumped him up to a level 2 investigation-whatever that is, but he thinks it is a higher level and the FBI means business. $20,000,000 at Amex, $15,000,000 at community banks and pretty soon, you are talking real money.”





“Finance Team of America (Eric Castro, Bob Castro, Mommy K.C.

Castro and all the other members of the Castro clan (Fidel was fishing and

could not attend) today in Weston, FL ...unloaded with three hours and a two inch thick file they have been building, including letters from Amex to lessors/debtors saying they realized there was a problem with the lease/loan payoff and they were addressing the problem with RW Professional and expected to reach an acceptable resolution for all parties---in other words-B.S.. They are convinced that Amex cut a payment plan deal with Barry and he is screwing the community banks by taking early payoffs on leases and loans and using the money to make the payments to

Amex. They said they heard he was paying as much as $70,000 a week. The

logic-Amex could sue him and make him go BK and even prosecute him for

fraud. However, each community bank as a stand alone entity will probably

take a 100% write-off and not pursue him since the dollar amount is probably

less than $300,000 per bank plus they may only be seeing a $50,000 problem

at a given time and being a little nave, not putting 2 + 2 together to know

that their entire RW portfolio is at risk. Plus, they do not talk to each

other and band together---divide and conqueror.


“Barry Drayer told me he had 48 community banks in

his network-all established by Al Crawford in Albany, NY.


(5/2002) Finance Team of America makes complaint to Massachusetts Attorney

General regarding RW Professional Leasing.



During this time, the Leasing News stories got the attention of the authorities, several community banks, and some physicians, like one who was asking for a payoff at the bank that he showed they had 11 payments left and the bank 52,and was physician contacted the first bank, before assigned, and it showed he had 11

payments left and was a slow pay. There were two other similar situations,

plus the lawsuit brought by RW Professional former brokers who's clients

were telling them the same thing. Here is one example.


Brett Llewellyn

Address = 342 15th Ave E

City = Seattle

State = WA

Zipcode = 98112

Phone = 2066259061

Fax = 2067266056

Email =

Source =

Add me to the mailing list = yes

Comments = I would love to discuss my nightmarish experience with the elusive Professional Leasing, in detail. I am optometrist who has opened a new practice, even after dealing w/ RW Professional Leasing; you are welcome to contact me. Dealing w/ them was(and is) the worst "customer service " experience of my life.


The internet was bringing us RW Professional Leasing customers who did not know what to do. Community banks were also calling, aware of

the “problem.” If you run a search on RW Professional Leasing, you will

not find their website, but you will find Leasing News stories mentioned

in over 50% what comes up about RW Professional Leasing.


Names: Bill Redig

Address = 3106 N. Rockton Ave

City = Rockford

State = IL

Zipcode = 61103

Phone = 815-987-4550

Fax = 815-969-8959

Email =

Add me to the mailing list = yes

Comments = I have read your articles on RW Professional Leasing and Barry Drayer and was curious if there any updates on the situation. I could find. I work for a community bank that is currently getting screwed by PLS by the means outlined in your article. Thanks


(5/2002) Lawsuit charging RW Professional, Professional Lease Services, Barry

Drayer, Rochelle Bessemer and Wallace Bessemer with 19 counts of fraud to be

filed in the Nassau County Superior Court in NYC being drawn up. Charges made by Crawford and Sons Profit Sharing Plan claiming $850,000 in

damages. Suit requests that all assets of all parties be frozen. Crawford

told me that the hit on the community banks Barry used will take over

$15,000,000 in addition to the losses at Amex. They also plan to sue Amex

for supposedly reaching a deal with the devil where Barry used early payoff money from the community banks to pay Amex's payout plan to keep him out jail.

(Maybe Barry Drayer will cut a deal with the authorities for collaboration

of this arrangement?)



June 19,2002—Crawford & Sons Profit Sharing Plan along with East Prospect State Bank, Equitable Bank, First National Bank, First Security State Bank, Northwest bank, People’s Bank, Sand Ridge Bank, Bluestem National Bank, First Victoria National Bank, American Savings FSB, Mutual Federal filed against the Bank of New York, Rochelle Besser, Wallace I. Besser, Barry Draywer, and RW Professional Leasing Services for over $10,842,333.13 unpaid principal plus unpaid interest, attorney fees and court costs, adding action

was a violation of RICO, too.


(The lawsuit represented by Crawford & Sons only names 14 of the 48

community banks Barry Drayer said he did business with. We may highlight

certain section of the 28 page lawsuit in another report. Editor )


Leasing News has heard from other community banks, which are not mentioned in this filing, and whether they will be filing a “class action” suit is not known at this

time, but expected.


Leasing News would like to thank the two attorneys who provided their services

“gratis” to help us with accusations from RW Professional Leasing about our



Peter S. Hemar, Esq.

Hemar & Associates

2001 Wilshire Blvd., Suite 300

Santa Monica, CA 90403

(310) 829-1948

Fax: (310) 829-1352



Kenneth C. Greene

938 B Street

San Rafael, CA 94901

Tel: 415 721 7900

Fax: 415 256 9922


(Who is also on the Leasing News Advisory Board)


This story regarding RW Professional Leasing, the community banks, American

Express Business Finance and Sierra Cities is still unfolding.



The Gazelle is Back????


Just when you thought the corpses were dead and buried, along comes a swell

in the ground water raising all the rotten evils from Lessors past to the

surface. Your coverage of RW Professional has been intriguing and accurate.

But to regurgitate the most publicized and talked about fraud within First

Sierra/Sierra Cities.Com would be old news to your readers.


Tom Depping you call "The Gazelle” is more like "Hannibal the Cannibal" as he has eluded legal action, deceived countless with his Enron style accounting, and while enjoying mountain air, Chianti and fauve beans living in Breckenridge , awaiting the turn of another page in his fairy tale, along comes the FBI to spoil the day.


Tom Depping, John Wayne Gacy, Theodore Bundy, Albert DeSalvo


Were his business practices synonymous with those of infamous Serial

Killers? Known and hidden acts of deception? or simple ignorance and

unknowing trust in others?


Mistrust, abandonment, neglect---Do these traits found in ruthless killers,

appear in destructive and deceptive business practices covered up by the

likes of Tom Depping?


While Hannibal hopes his evil ways aren't revealed, the recent round-up of

Leasing rats is about to open another can of worms. Not only will the

"Directors and Officers" insurance policy be reviewed for an immediate

claim, but perhaps an investigation into a similar affiliate of Sierra

Cities, aka "Ponzi Scheme" or more familiar named OMNI LEASING in Detroit

will finally put Hannibal away. Stay tuned.......................


( Name With held )






Mineta Is 'Confident' On Future Of Amtrak


Secretary Vows to Find Solution to Cash Crunch


By Don Phillips


Washington Post Staff Writer


Transportation Secretary Norman Y. Mineta said yesterday that he is confident the federal government will not allow Amtrak to shut down and will work with the company's board and with Congress to ensure that passenger rail service continues.


"I am confident Amtrak will not shut down," Mineta said after leaving a meeting of the Amtrak board. "Everyone who depends on this vital rail service needs to understand that this administration and Amtrak will work together and with Congress to make sure that passenger service continues."


It was the first time that an administration official had made that strong a pledge to work to prevent an Amtrak shutdown. Administration officials have said they would "work furiously" or "make every effort" to prevent a shutdown.


However, Amtrak issued a statement saying that Mineta's pledge may delay a shutdown, but that there is still no agreement and the shutdown still looms.


"Secretary Mineta's pledge to avert a shutdown of Amtrak in the next several days is greatly appreciated," said the statement by Amtrak Board Chairman John Robert Smith and President David L. Gunn. "However, there has been no reconciliation of the simple fact that Amtrak is running out of cash and no agreement of how to provide a loan guarantee or appropriation that will continue train service to the end of the fiscal year.


"In short, the pledge delays the shutdown, but does not stop it from occurring."


Gunn has said that Amtrak will run so low on cash this week that it will be forced to begin an orderly shutdown of all the country's passenger trains and most commuter operations unless $200 million is found to tide the company over until the beginning of a new fiscal year on Oct. 1.


Gunn said that if Congress or the administration appeared near a solution he could delay the shutdown for a few days.


After meeting for three hours with the Amtrak directors yesterday, Mineta acknowledged that a solution had not yet been found, and the board meeting continued.


"We have had a very productive discussion today, exploring every possible option to ensure Amtrak's continuity of operations," Mineta said.


He gave a vague outline of what the administration wants from Amtrak and Congress in exchange for whatever financial solution is found. "First," Mineta said, "Amtrak must continue to search for ways to cut expenses and to build on David Gunn's initial efforts to get control of its finances.


"At the same time, the federal government will continue to identify the best mix of loan guarantees and other means to stabilize Amtrak's short-term finances."


Mineta said that any solution "must be a team effort. The burden is not on the administration alone to save the rail system from bankruptcy. It will take all the parties, including the Congress, to take the initiative and build the solution to Amtrak's fundamental problems."




eLNA Expands Networking Event To Invite Monitor 100 Companies


eLNA extends complimentary Attendee Registrations to CEO/Presidents of companies listed in the June 2002 edition of the Monitor 100


August 28-30th


Atlanta, GA - (The Lessors Network Newswire) - - Over the past three years, the eLessors Networking Association (eLNA) has sold out each of its annual networking conferences. According to John Semon the secret is simple, “we leverage the strength of service and elegance from the Ritz-Carlton hotels. We schedule the most innovative, cutting edge technology and financial resource exhibitors and speakers. And we insist on an exclusive attendee audience made up of senior level decision makers from the equipment leasing and financial technology markets.”


This year eLNA has decided to expand the event's total attendance to accommodate complimentary attendee registrations for CEOs and Presidents of companies listed in the June 2002 edition of the Monitor 100. According to Semon, “we have built our reputation on delivering high profile, upscale events and these are exactly the types of attendee/executives we can do business with. What better way to enhance networking benefits for conference exhibitors and attendees than to invite as your guest the top executives from the 100 largest equipment finance/ leasing companies in the U.S.”


About the eLNA Annual Networking Conference


From the beautiful Ritz-Carlton, Buckhead hotel in Atlanta, eLNA has perfected the art of networking hospitality, refined to embrace a standard that today's business executives find particularly appealing. While this event embodies a "Technology" spirit and theme, it also reflects eLNA's signature style of elegance and a professionally intimate "Networking" culture. Additional information is available from -




Jeff Taylor Website Tops in Search Engine Report by MarketLeap


MarketLeap, an Internet market research firm, ranks us as #1, #2 or #3 in the world by 24 of the top 29 search engines for the search terms lease training and FASB 13.


Thank you for your support. We appreciate it.


Jeffrey Taylor




California home prices surge to new highs in May



SAN FRANCISCO (AP) -- California home prices surged to another record high in May, a real estate research service said Monday, magnifying worries that hyperactive buyers are creating an investment bubble by shifting money once earmarked for the sagging stock market into the state's housing market.


The concerns about absurdly high housing prices are particularly acute in the San Francisco Bay area, where a mid-priced home in May sold for $413,000, a 9 percent increase from the same time last year, according to DataQuick Information Services. The May figure eclipsed the previous high of $402,000 reached in April.


Prices are rising even more rapidly in Southern California, where a mid-range home sold for $264,000 in May, a 17 percent increase from last year, DataQuick said. But the risks of a bubble developing in Southern California appear lower, largely because prices remain so much less expensive than in the Bay Area.


A mid-priced home in the Bay Area now costs $84,000, or 25 percent, more than in March 2000, generally considered the stock market peak for the high-tech mania that forced housing costs to skyrocket in the nine-county region.


Meanwhile, the Nasdaq stock index -- the primary yardstick for measuring high-tech investments -- is 71 percent below its March 2000 high.


The tremendous wealth generated by the run-up in tech stocks during the last half of the 1990s is considered the main reason why Bay Area home prices are so much higher than in Southern California, where deep cuts in defense spending a decade ago devastated the region's aerospace industry.


Bay Area home prices dipped briefly last year amid the ruins of the high-tech wreck, but they have bounced back quickly to reach new highs with the help of the lowest mortgage rates in a generation and a spreading conviction that California real estate is a better bet than the stock market.


Buying a Bay Area home "has always been a solid, long-term investment and people are a little more interested in that now," said Steve Hanleigh, a San Jose real estate agent and president of the Santa Clara County Association of Realtors.


Despite a history of steady price appreciation in the Bay Area's housing market, the recent run-up appears unsustainable, according to a report released last week by economist Edward Leamer of the UCLA Anderson Forecast.


Leamer reasons that home prices ultimately are driven by a cost-to-benefit analysis similar to the price-to-earnings ratio widely used to value stocks. The price-to-earnings equivalent for a home is the rent-to-price ratio, Leamer said. If it would cost $25,000 annually to rent the same kind of home that sells for $500,000, then the home has a rent- to-price multiple of 20.


With home rents coming down at the same time ownership prices are rising, the Bay Area's housing market is now 6 percent above its previous "bubble" peak of 1989, Leamer estimated. In contrast, rents in Southern California are still rising, leaving the region's home ownership market 17 percent below its 1989 peak, Leamer said.


"Buying a home in the Bay Area right now is like investing in the Nasdaq at 4,000 after it came down from 5,000 because you thought you were getting a really good deal," Leamer said Monday.


Other observers downplay the chances of a real estate bubble developing in the Bay Area.


Unlike a few years ago, Bay Area buyers aren't getting into cutthroat bidding wars that push the sale price far beyond the asking price, said Will Carrillo, who runs several Re/Max Real Estate Services in the Silicon Valley. "It's not as hot as it was a couple years ago."


And even though Bay Area home prices are higher than a couple of years ago, the real costs aren't as great because a sharp decline in long-term interest rates have pushed 30-year mortgages well below 7 percent. DataQuick estimated the typical Bay Area monthly mortgage payment in May stood at $2,075, still 2 percent below the peak monthly payment of $2,124 in May 2000.


"I know everybody is talking about a bubble in the Bay Area real estate market, but I don't see it yet," said John Karevoll, a DataQuick analyst. "If there is one, it's still a long way off."


The DataQuick report factors in the sales of all homes, including condominiums, recorded by counties. The California Association of Realtors, a trade group, is expected to show even higher May prices this week when it releases its study, which is limited to single-family homes and doesn't include all recorded transactions.



US could default on debt


The US war budget has proved costly


The growing US budget deficit is rapidly turning into a game of brinkmanship for the Bush administration.



If they don't act

we're going to hit the wall probably by next weekend


The US government will officially run out of money at the weekend unless the US House of Representatives approves an increase in the national debt ceiling this week.


The government wants the authority to borrow an additional $450bn (300bn; 464bn euros) above the existing level of debt of $5.95 trillion.


"If they don't act we're going to hit the wall probably by next weekend, because on Sunday we've got to certify social security payments and we have some other large payments," said US Treasury Secretary Paul O'Neill.


The US Senate has already approved the increase, but the measure is deadlocked in the House of Representatives, where conservative Republicans are refusing to back an increase to the government's debt.


As a result, the government has had to cancel its regular sale of Treasury bills this week, the normal way it raises money in the financial markets.


Spending boost


At the root of the problem is the huge increase in the US budget deficit, which has soared because of the cost of the war on terrorism, as well as the reduced revenues caused by tax cuts and a slowing economy.



Military spending has soared


Last month the US government recorded an

$80bn deficit, with tax receipts of only $103bn compared to spending of $183bn.


Just one year ago, Congress was debating how to spend a projected budget surplus of several trillion dollars over the next 10 years.


Now, the Congressional Budget Office has forecast a budget deficit of $150bn this year and $171bn next year - and those forecasts are likely to be revised upwards in July.


As a result, the government will be forced to use its surplus on its social security retirement funds to balance the budget.


Political deadlock


But House Republicans - who are facing criticism from Democrats in an election year for giving too much away in tax cuts for the rich - would like to attach any increase in the debt ceiling to a supplemental spending bill.


"What we've done with tax cuts is help this economy. We're going to get back to balanced budgets," said House speaker, Dennis Hastert.


The stand-off between House Republicans and the White House is part of pattern of weak economic policy leadership from the Bush Administration.


After passing a huge $1.3 trillion tax cut last year, other government initiatives - such as reform of social security, increases in energy production, and the pursuit of free trade - have become mired in political controversy.


But if Congress allows a government default, it could damage financial markets, and lead to a further fall in the value of the dollar, which has already reached a two-year low against the euro.



To reach Leasing News, please e-mail or use the

contact form at Fax messages are often difficult to read.

Telephone calls result in “telephone tag” and often take longer to respond due

to time differences and limited time. E-mail is always best.


Leasing News is sent ONLY to people who have requested it. We do not Spam.

You register using our website or contacting . Our subscriber list is NOT made available to

the third parties. Subscription and Removal Assistance can

be accessed through out contact site at or you may

directly contact with you name as you registered it

along with you-mail address ( our list is kept by the name registered, not

by company or e-mail address. We have great difficulty in finding your

e-mail address without your name. If you have signed up and are not

receiving Leasing News, your carrier may be blocking the "mass mail". You

may notify your carrier or send an e-mail to us for verification, if

needed. Online version of this publication is at


Policy Statement


Policy Statement---Nothing is sent out that is not "fair." Always unbiased

reporting. Fairness always. If it is questionable, we will ask the writer's

permission to quote them. We will print information without attribution, but

feel as long as we do not name the person who sent it, we can use the

information. Any information we think is suspicious, we try to have if

substantiated first by at least two reliable people. We will not purposely

send out "negative" news. We prefer

"positive" news. We have no "axe" to grind or are not paid or seek or accept

any remuneration for product or promotion. We do not Spam anyone. To be

added to the mailing list, you must request it. We do not send anything

about our company or personal e-mail or jokes to the leasing news list. We

do not share our mailing list with anyone. We try not to send more than one

report a day, if at that, unless an "alert." We follow Internet

Netiquette at all times. Our sole purpose is to provide communication to

improve our profession. We reserve the right to deny sending the newsletter

when requested. We reserve the right to edit or delete an opinion that is

not in good taste or is outright derogatory.

Virus Info Center
Top Stories
Leasing News, Inc.
346 Mathew Street,
Santa Clara,
California 95050
Voice: 408-727-7477 Fax: 800-727-3851