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Show Page 10 The Ogden Valley news Volume XVIII Issue II July 1, 2010 FRAUD cont. on page 10 she and a boyfriend were collecting several thousand dollars a month in expenses, according to former board members and officers. Stevens’ daughter also was paid $5,000 a month. Three other vice presidents were paid up to $12,000 a month and two of their wives $5,000 a month apiece. In addition, six salespeople were paid $6,000 a piece a month, plus expenses. Earl Houston, the vice president of sales and marketing, who later became the company’s CEO, said that these employees were “all highly educated, qualified people, but when you’re a start-up with literally zero sales, or at that time a couple of hundred thousand, it’s tough to justify six VP’s”. By 2008, Ciralight was being propped up by infusions of cash from George Adams, owner of Adams Steel of Anaheim, Calif. who invested more than $1.8 million. Adams’ connection to Ciralight had been through brother-in-law Fred Feck, a shareholder who became a board member sometime in 2008. Feck had been a friend of Stevens and a Ciralight board member. Adams apparently had no definitive agreement that he was buying shares with his cash, and by midyear, as Ciralight foundered, he had grown nervous about his money. In a memo dated July 8, 2008, Adams said he was providing another $150,000 but wanted 7 percent interest in return from day one, as well as an agreement to pledge its account receivables to guarantee repayment or until a final working solution was reached. With the signatures of Stevens and Feck on the memo, the financing became a loan. The board, however, believed that the monies flowing into the company were from the sale of shares. Ms. Stevens led board members and shareholders to believe that this was an equity position and she had only received $200,000 from Adams. Houston notified the board that Adams’ investment was in fact a loan. He pointed out that Stevens and Feck had violated company bylaws that required board approval to incur debt. Houston then resigned. “On my last day there—I made an argument at the board of directors meeting as the lame-duck resigned guy that those two people who signed that document that obligated the company to that indebtedness in that structure should immediately be terminated,” Houston said. He advised the board that it “should replace those two and go back to the note-holder and say, ‘Hey, we’ve got a useless piece of paper here because this was done without full board approval, and we terminated the board members because we discovered this.’ Instead, the board gave a “slap on the wrist” to those involved and continued to treat the money as a loan,” he said. Stevens, in two interviews by phone that she cut short, said the board was aware of and approved the Adams loan, though she said she didn’t remember whether approval came before the loan document was signed. Board member Feck did not return a phone call seeking comment. Adams said in a recent phone call that he did not remember much about the deal and referred questions to the CEO of the new lighting company that Adams had formed with Ciralight assets. The CEO referred questions to an attorney, who did not return two voice mail messages. After Houston’s resignation, Huntsville former resident and international sales manager Ray Torres was appointed general manager in charge of day-to-day operations. On Jan. 2, 2009, Torres notified the board of a potential problem involving Stevens. Photocopies of emails sent by Torres and company documents show that Stevens had billed Ciralight $4,800 for work performed by an engineering firm called Consultech of Carlsbad, Calif., for instal- lation of 24 skylights at a building in La Verne, Calif. The 2008 Consultech invoice, marked in handwriting “Pay to Jacque Stevens,” and was for “turn key engineering services” for “Brutoco/Metropolitan water district.” But Consultech apparently did no work on that project. Instead, Ciralight’s check was deposited into Stevens’ bank account, a copy of the check shows. In an e-mail to the board Torres said he had found “clear intent to commit fraud and embezzle funds. I consider this my fiduciary responsibility to report this. If you don’t act on it, I will.” Torres said he was fired January 14, 2009, along with his wife, who was the office manager. The board did not report the information to police as Torres urged. A copy of a canceled check and other documents also raise questions about one stock transaction involving Stevens. Stevens later resigned as vice president and as a member of the board. Shareholder Greg Schmalz of Brick, N.J., who also had served as a marketing consultant for the company, said in an interview that in November 2007 Stevens pitched him to buy more stock in Ciralight. He agreed to invest another $10,000 but what he received was a “membership certificate” for Lighting the Way LLC, a company registered to Stevens, rather than stock in Ciralight. Schmalz contends his money went directly to Stevens, who now owns A-1 Daylighting, another lighting company. “She wasn’t honest what the money was for in the first place,” he said. “I was totally deceived.” Schmalz said. By January 2009, as Ciralight continued to accept more money from Adams, he was owed $1.8 million, according to Ciralight records. Adams also took control of company finances, deciding who would be paid and who would not. On Jan. 20, 2009, Adams filed a lien with the state Department of Commerce on all of Ciralight’s assets. Six days later, an attorney for Adams notified Ciralight the company was in default on a “promissory note” dated Dec. 11 for $1.85 million that included interest. The letter demanded payment and threatened to foreclose and take the assets listed in the Department of Commerce lien. The next day, board chairman Dausch and board members Feck and Bruce Day signed a statement giving Adams the right to manufacture and sell Ciralight’s product, and handed over the patent rights. They also agreed to ship inventory to Ontario, Calif. Ciralight shareholders have asked for an investigation by the Securities and Exchange Commission, which won’t confirm or deny its involvement. “It was a completely crooked and a total fraud,” said shareholder Marsh, who said he has spoken with an SEC investigator. As for former CEO Basch, his opinion of Stevens today is this: “Let me put it this way, as clearly as I can—not to be trusted. She’s a woman who doesn’t have boundaries.” Note: Information from the “Salt Lake Tribune” being used by permission. Visit www.sltrib.com/ci_14700909 to read the full “Salt Lake Tribune” article. Inspirational Thought “Men are anxious to improve their circumstance, but are unwilling to improve themselves. They, therefore, remain bound.” -- James Allen COMMUNITY cont. from page 3 cancer and to be an inspiration to others who have or are currently battling this disease. With over 20,000 people at this event, I know that we are not the only ones who are striving to find a cure, and that in itself is such an inspiration to me. I have never seen so many people gathered for one cause; I am so happy to know that so many people have devoted their lives to finding a cure as well. Breast cancer has affected almost every person in one way or another, and it is events like these that help us to find a cure. I truly UEG ETHICS cont. from page 3 has been made, the only avenue for relief is the state court system. The independent ethics commission will be a law unto themselves; a NEW separate branch of government where the representatives are NOT voted into office. 6. Where are the defined rules? – There are only a few defined rules for the independent commission. The petition actually relegates rule making to the commission, again making them a law unto themselves. 7. Swift or lengthy process? –The petition grants the commission contradictory time limits to bring a case to a close. Legislators might find menacing accusations hanging over their heads during the campaign season giving opponent’s added ammunition. What if the accusations are not true? 8. Consequences –“(3) Any conduct which violates the code of conduct shall be deemed in every instance to be one or more of the following: (i) a felony; (ii) a breach of the peace; (iii) an action outside the ordinary course of legislative business; (iv) an action beyond the scope of a legislator’s official duties.” A felony? There is nothing written in the petition that states this is only a suggestion to a higher court. What an easy way to circumvent the voting process and remove unwanted legislators from office not to mention greatly damage a person’s life. (pg. 14) 9. How can the commission gather information about a claim? –“The commission may gather information by any appropriate means, including the issuance of subpoenas in order to compel the production of documents and the attendance and testimony of witnesses, and for any purpose under this Act.”. And…..“Testimony may be taken at public hearings or closed….” Closed door investigations? Subpoenas? (Pg. 10) 10. Who can be a legislator? – No one that owns a business or is a control person in a business. (Pg. 10) 11. What can a legislator do after serving in office? – They can’t be a lobbyist. They’re going to tell people where they can or cannot work after they leave office? Is this Constitutional? (Pg. 11) 12. Who can a Legislator accept donations from? – ONLY PACs (Political Action Committees) and individuals. PAC’s have long been a great source of income for the UEA and their lobbying efforts. Conclusion The above is just a spattering of unethical aspects of this insidious petition. The UEG ethics petition is nothing more than a (UEA) Utah Educators Association coup. It’s a cleverly disguised weapon to gain power over the Utah state legislators; something they’ve longed for. Do teachers deserve more pay? You bet! Do our children deserve more? Absolutely! But this is not the way to do it! Don’t allow yourself and your children to be used as pawns in this backdoor power grab! am honored to have my mother in my life, and know that breast cancer was brought into our lives for a reason. We are a stronger family because of it. I can truly say that my mother is my best friend and she is the most inspiring person I have ever met. An Ogden Relay for Life was also held Friday, June 4, 2010 at Weber State University. Relay for Life is an all-night team walk where you have at least one member of your team on the track at all hours. Note: For more information on the Ogden Relay for Life, visit <http://main.acsevents.org/ site/TR?pg=entry&fr_id=25117> The final and convincing clue is the UEG’s and UEA’s loud opposition to bill SB 275. This saving bill allows citizens to remove their signature from a petition without a notary. Given that we’re not required to have a notary to sign a petition; SB 275 is very reasonable. Why would the UEG/UEA oppose such an obvious citizen’s rights bill? That’s easy, because they knew once Utah citizens understood what’s in the petition, they’d remove their signatures. “SB275: Removing Signature from Initiative and Referendum Petition (Opposed by UEA, Passed) This bill repeals the requirement that a voter must submit a notarized statement in order to have their name removed from an initiative or referendum petition. It also allows extra time from the date a petition is submitted until it is certified. The bill will, in effect, make it much easier for opponents to nullify a successful initiative or referendum.” http://www.utea.org/politicsLegislation/legislativeInformation/index.htm Do we need ethics reform? I want to study current laws especially the five laws passed in the 2009/10 session before I can answer that question. Regardless, this is not the bill citizens want. It’s only designed to give UEA more power. There are many good aspects to this petition; unfortunately they are sandwiched in with power strategies for UEA that if passed will have devastating unwanted repercussions for years to come. Sadly, this type of deceptive legislating is the order of the day. We do NOT want to pass this petition to find out what’s in it later! How to remove your name from the petition Here are the simple but important steps to have your signature removed as outlined in SB 275. This must be done before August 12, 2010, the sooner the better. A voter who has signed an initiative petition may have their signature removed from the petition by submitting a statement requesting their signatures be removed to their county clerk. The statement has to include: 1. the name of the voter 2. the resident address at which the voter is registered to vote 3. the last four digits of the voter’s Social Security number 4. the driver license or identification card number; and the signature of the voter The statement may not be sent by email or other electronic means. In order for the signature to be removed, the statement must be received by the county clerk before the petition is delivered to the lieutenant governor. Please contact your county clerk for specific deadlines regarding the UEG Ethics Petition. Do this as soon as possible. UEG’s legal deadline for signatures to qualify for the 2012 election is August 12, 2010. Acupuncture and Chinese Herb Clinic Beth Kristenson, Licensed Acupuncturist Tuesdays & Thursdays 9:00 a.m. to 7:00 p.m. Saturdays 10:00 a.m. to 3:00 p.m. on non-Community Acupuncture days. Community Acupuncture on the first and third Saturdays of the month, no appointment necessary for Community Acupuncture. For more information, call 801-783-2094 or visit www.shanyaomtnmed.com Located in the Old Town Eden building 2234 N 5500 E next to Carlos and Harley’s. Red Cliff RanCh & Cafe July Music Fest @ Saturday Saturday, June 26 ~ Tim Daniels 6 p.m-9 p.m. Saturday, July 3 ~ Band called “Secret Abilities” 2 p.m-5 p.m. Saturday, July 10 ~ Band called “Broken Pony” 6 p.m-9 p.m. Saturday, July 17 ~ Tim Daniels 6 p.m-9 p.m. Saturday, July 24 ~ Band called “Cherrystrip” 6 p.m-9 p.m. Saturday, July 31 ~ Band called “White Ivory” 6 p.m-9 p.m. Horseback Rides Now Serving Hot Wings Located below Causey Dam “the gateway to Monte Cristo” 801-745-6900 |