Saturday, March 27, 2010

JIM KING CPA: WHO IS THE REAL KING?

A few months ago during the unending research I have been forced to undertake on Jim King thanks to his lack of openness and transparency I ran across an article at http://www.louisvillecourant.com/ concerning a King audit in Miami. This information actually made me start looking further and I have to say King concerns me even more than he did before.

While Jim King has had many problems of his own here literally no one I speak with even knew he had a business in Florida much less any of the people in Florida he is working with and how they are tied to Kentucky.

I will focus this article on one such person and business.

The Florida Gaming Commission owned by Bennett Collett is one such Company. Bennett Collett is from Kentucky and has a major checkered past including being sued by the SEC in 1979. the SEC alleged Collett headed a group of investors who acquired companies and gutted them by causing them to transfer valuable assets for inadequate consideration.

Collett was also, according to the Miami Herald, coming under fire from the Indiana Department of Insurance. In 1981 the Indiana Department of Insurance sued Collett personally claiming he stripped Pilgrim Life Insurance of its liquid assets. He settled the suit 2 years later for $175,000.

In 1993 a Company called Lexicon was on its way to being delisted by NASDAQ so none other than Bennett Collett, who owned Freedom Financial by that time, bought Lexicon.

Collett established Freedom Financial in 1985, less than 6 years after his SEC ordeal and his Indiana Insurance settlement, to serve as a bank holding company yet by 1988 ( 3 years later) he had sold off his banking subsidiaries.

When he tried to take Freedom Financial public in 1990 trying to raise $10 million state regulators in New Jersey, Indiana, and Kentucky killed the offering because "the prospectus issued to potential investors failed to disclose that Collett had been the subject of at least six prior legal actions."

According to Indiana Securities Division Commissioner Mark Maddux, as quoted by Business First-Louisville, Collett "had a history of bad relations with people who have invested in his entities. There's just been a long history of disgruntled investors in this person's companies."

Despite being unable to take Freedom Financial public, Collett gained the benefits of a publicly traded, listed company when Freedom Financial acquired Lexicon, which by 1993 was nothing more than a shell corporation.

Now the logical question. What in the world does this have to do with Jim King and perhaps Steve Beshear?

First, Jim King is Bennett Collett's CPA. Collett and the banks in Miami that King does work for have a very checkered past. Most would agree in life you generally surround yourself with like minded people. If this holds true then who King surrounds himself with in this situation is very alarming.

King himself in 1997 acknowledges auditing Florida Gaming Corporation's financial statements giving them a squeaky clean bill of health from 1993-1994
http://www.secinfo.com/dRQYx.8r.htm

The audits completed by King's company are not satisfactory to the PCAOB.

PCAOB Release No. 104-2009-074
Inspection of King & Company
Certified Public Accountants, P.S.C.
May 21, 2009
Page 4
inspection team that the Firm did not obtain sufficient competent evidential matter to
support its opinion on the issuer's financial statements.9/ Those deficiencies were –
(1) the failure to perform sufficient procedures to test the valuation and
accounting for stock options issued; and

(2) the failure to perform sufficient procedures to support the Firm's reliance
on controls at a service organization.

B. Review of Quality Control System

In addition to evaluating the quality of the audit work performed on a specific
audit, the inspection included review of certain of the Firm's practices, policies, and
procedures related to audit quality. This review addressed practices, policies, and
procedures concerning audit performance, training, compliance with independence
standards, client acceptance and retention, and the establishment of policies and
procedures. As described above, any defects in, or criticisms of, the Firm's quality
control system are discussed in the nonpublic portion of this report and will remain
nonpublic unless the Firm fails to address them to the Board's satisfaction within 12
months of the date of this report.

The evidence shows that Bennett Collett swindled investors and shareholders in Pilgrim Life and until Lexicon was bought as a shell company he could not trade publicly it seems. Jim King has been his CPA forever, giving his current control of a public company an air of integrity.

The 2009 audit above on Jim King's work did not pass with flying colors and they edited out the info that identified the client


Look at the chronological sequence of events below and draw your own conclusions on King and his relationships. Seems like a way of life for what he does here in Louisville does it not?

1979: Kentuckian W. Bennett Collett sued for fraud by the SEC. According the Miami Herald, "After a turn as an accountant, he struck out on his own, becoming primarily involved in insurance and banking. He served as principal shareholder and chief executive officer of 11 small banks across the country."
http://www.fundinguniverse.com/company-histories/Florida-Gaming-Corporation-Company-History.html

Sound familiar though King has less than 11 total.

1981: Indiana Department of Insurance sues Collett personally, claiming he had stripped Pilgrim Life Insurance of it's assets forcing it into liquidation. Collett settles but later denies settling, according to the Miami Herald: "In all, four of Collett's insurance companies ended up in liquidation.
http://www.fundinguniverse.com/company-histories/Florida-Gaming-Corporation-Company-History.html

1982: Former FBI Agent John Connolly sets up a mob-hit on a former President of the Miami Jai-Alai: Mr. John B. Callahan. Callahan's bullet-riddled body was found in the trunk of his Cadillac on Aug. 2nd in a parking lot at Miami. Connolly was killed after he told some guys about how the FBI was investigating his ties to the Winter Hill Gang and the murder of Roger Wheeler who had just been killed by the same hit man that killed Callahan in Tulsa, Oklahoma back in May.

Wheeler was owner of World Jai Alai. This story was later the basis for the movie, The Departed.
http://wbztv.com/local/john.connolly.trial.2.856858.html In the movie, they left out "jai alai" because no one outside of the mob actually knew what it was.

1983: A body shop mechanic who took a $150 gamble raked in a cool $328,589.20 at Miami Jai-Alai on a Saturday afternoon, the second largest pari-mutuel pay-off in FL history.

1985: Collett founds the Freedom Financial Corporation.

1986: CPA Jim King buys controlling interest in Peoples State Bank in Bardstown. This is interesting simply because of the next line. He was later sued by William Pullman that went to the Supreme Court.

1988: Collett has sold off all his banking interests. Why did Collett sell off his banks?

1993: After unsuccessful attempts at taking Freedom public, Collett uses Freedom to acquire the Lexicon Corporation which was an empty shell of a company by then. He then changes its name to the Florida Gaming Corporation. This was beneficial for Collett because now he can have the benefits of a publicly traded company.

1997: King acknowledges auditing Florida Gaming Corporation's financial statements giving them a squeaky clean bill of health from 1993-1994
http://www.secinfo.com/dRQYx.8r.htm#7py

2003: King + Company, PSC is obligated to file reports with the PCAOB because it's previous year audit of the Florida Gaming Corporation. King reports that his firm received $90,000 for services from the Florida Gaming Corporation in 2002 for some of this (independent?) auditing. The audits completed by King's company are not satisfactory to the PCAOB. http://louisvillecourant.blogspot.com/2009/09/why-king-audit-is-relevant.html

2004: King Southern Bank pops up on the interweb tubes mysteriously for the first time.


2008: Florida Gaming Corporation has no trouble borrowing $1 million from Louisville-based Stuckert Financial Group.
http://southflorida.bizjournals.com/southflorida/stories/2008/09/15/daily64.html

And this brings us to Steve Beshear. With the history of Collett and Jim King, why then did he do the following? Is this relationship why he has been rumored to have halted the KSP investigation on King?


2009: Governor Beshear appoints James W. Stuckert to the University of Kentucky Board of Trustees. http://migration.kentucky.gov/Newsroom/governor/20090706appts.htm

Collett gets a $1 million loan with his history? Did Jim King orchestrate the loan because of his history? Why would Beshear appoint Stuckert to the University of Kentucky Board of Trustees if he is dealing with Collett?


And oh by the way.

2009: According to Forbes http://people.forbes.com/profile/w-bennett-collett/34082 Collett received $2,698,581.00 in 2007 as CEO of Florida Gaming Commission.

Make up your own minds but there is a helluva lot more going on with insider politics and schemes than we know about.

Your thoughts?

3 comments:

  1. Collett surounds himself with like thinking people

    ReplyDelete
  2. Read the most recent 8-k 10-20-10 posting on SEC website.

    ReplyDelete
  3. I had researched and found this exact information on Collett back in 2005 while I was involved in a 5-year legal battle with him. I even found other information specfic to some of his business misdealings involving Pilgram under a search of "Bennett CollettE"

    http://townoflakesanteetlah.org/historyoflakesanteetlah.htm

    ReplyDelete

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