Professional Documents
Culture Documents
IM= 310.CPR
DA= January 18, 1991
AT= AUDIO TRACKS: /ALL
PA= PAGES: 01
SU= SUMMARY: This communication matrix illustrates the flow of
information that was used in the alleged "BLACK MAIL" of
Stan Caterbone and the "ISC $BILLION DOLLAR COVERUP"
************************************************************
TI=\ISC PURCHASE
IM= 001P01.CPR
DA= September 21, 1983
AT= CORRESPONDING AUDIO TRACKS: 02/08/09
PA= PAGES:
2
SU= SUMMARY: Confirmation of the purchase of 1000 shares of
International Signal & Control bought by Stan Caterbone
on Septermber 21, 1983. This stock was recommended
and solicited by Gibson Armstrong of Individual
Securities, of Lancaster PA.
01
IM= 001P02.CPR
DI= PAGE 2
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TI=\HIGH EMPLOYMENT
IM= 002P01.CPR
DA= October 25, 1985
AT= CORRESPONDING AUDIO TRACKS:
PA= PAGES:
1
02/
CURRENT SITUATION
CURRENT SITUATION
CURRENT SITUATION
The l986 Tax Act threatens to reduce the need for tax planning,
and tax qualified plans. Rather than seek shelters and other relief,
investors will be likely to pay tax, and invest savings, thereby
increasing the need for asset management and the creation of
wealth
COMPANY STRATEGY
Market products that are structured with lower up-front costs
and stable ongoing management renewals in order to build
revenue from service over a period of time. This will gradually
replace the heavy emphasis on new salesand give rise to a truly
responsive service oriented business.
4.
CURRENT SITUATION
Charitable organization
Counseling center
Current Situation
Current Situation
Current Situation
Current Situation
Current Situation
free
Company Approach
Planners will be free to deliver the highest quality products from
among thousands of sponsors so as to work exclusively for the
benefit of the client. The planner may choose top industry
performers, solid and sizeable companies and a variety of
"niche" products to fill every client need.
2.
Current Situation
Current Situation
Current Situation
Stock will be offered to the public at $5.00 per share until the
office opens on August 1, 1986. It is our plan to raise
$300,000 which will cover the start-up costs of furnishing the
office, capitalizing the Registered Investment Advisor and
Broker-Dealer, and funding any shortfall in operating revenues
for at least one year.
It is our intention to avoid borrowing monies if at all possible.
We believe that it is best to pay in advance and that a debt-free
status keeps monthly obligations to a minimum, thus reducing
business risk and increasing profitability. We are, likewise,
committed to low management incomes for all
principals/planners who will continue to generate personal
income from sales.
Our initial price will be discounted in order to recognize the
importance of several types of investors in our business. First,
investors who purchase in excess of 5,000 shares are
important because of our limit of 35 investors in the offering
each year.
Without sizeable investors, we will not be able to meet our
target of raising $300,000. Additionally, investors who will also
generate revenue for the business through financial services
marketing provide double value for our firm. Consequently,
we will offer shares at 3.50 to any major investor or producing
investor. If any investor proves to be both major and
producing, his price will be $2.50.
Our estimate of stock value, given recent takeover prices in the industry,
would place the
stock value at $5.60 after one year and $l0.67 after three years.
That price would be 3.5 times book value which increases with
each stock purchase. Purchases of some companies have
been based not on book value but rather on gross
commission income. The going price the last several years
has been a dollar for dollar price. Using that figure stock value
would be $l0.00 in one year, and $13.33 in three years.
Financial Service Corporation, a company reforming in l978,
is valued at $25 million dollars just eight years later. The
potential in this business is obvious, yet there are no
guarantees. This is a start-up business venture and suitable
only for long-term, equity investors.
It is our plan to build aggressively in several areas, but to
concentrate in Pennsylvania. We see a special opportunity
with a three to five year window when banks will get into our
business through acquisitions as they continue to lose assets
through their limited banking functions. Should a great
opportunity to sell occur, we would consider it at that time.
Our continued personal planning business could give us the
luxury of cashing our investment and remaining in business.
However, it is much more likely that we will hold our
investments until retirement or pass it on to future
generations.
Our specific issue restricts sales to another party for one year
and also limits repurchases to intrastate parties.
FINANCIAL HIGHLIGHTS
* Actual Statistics as of May 30, 1987
1987
1988
1989
May '87
SALES (Millions)
CAPITAL
54 M
78.1 M
Commissions
(GCI)
2.7 M
3.4 M
5.0 M
$3.5 M
Affiliate
Earnings
.3 M
.6 M
1.0 M
$.5 M
4.0 M
6.0 M
$4.0 M
Total Gross
Revenues
3.0Z M
Net Revenue
.76 M
Less Commission
100 M
1.01 M
1.52 M
$80 M
$ N/A
SALES FORCE
Manpower
(Proffessionals)
Hires
37
10
Retention
43
50
12
90%
14
85%
48
14
85%
$107,500
95%
$120,000 85 K
3.0
1988
4.0
1989
6.0
MAY '87
4.0 M
Net Revenue
.76
1.01
1.8
N/A
Retained
(Profits)
.21
.275
.501
N/A
Return on
Equity
70%
53.9 %
Capital Base
.300
.510
66.6 %
N/A
.785
N/A
Book Value
Begining of Year
.300
.480
.725
.300
Book Value
Per Share
1.60
1.81
3.05
4.00
Book Value
End of Year
.480
.725
1.526
N/A
Shares
300,000
400,000
450,000 245 K
Outstanding
Value/Share
(at 3.5 x book)
$5.60
Traditional
$10.00
(at 1 x Total Gross Revenue)
$6.34
$10.67
$10.00
$14.00
$13.33
$17.00
CONTINGENCY PLANS
The begining phase of most businesses phase is characterized
by erratic sales Trends, fluctuating market share, increasing
dependence on improving technological systems, and possible
cash flow losses.
We do not expect to face any of these problems because of
the established nature of the planners we are hiring. However,
we would be foolish to believe that we somehow were immune
from such potential problems and therefore need not to plan
for these eventualities.
Our very first need would be to raise capital through stock
purchases beyond our initial capitalization requirements to the
extent of at least $100,000 to cover any initial shortfall in
revenue or budget projections.
This would protect us from going the way of most
undercapitalized businesses - - bankruptcy.
Secondly, we expect to invest heavily in state-of-the-ar
technological system so that we do not face new
hardware/software changes early in our business development.
Stan Caterbone will devote much of his management time to
this area.
Priority will be given to reviewing performance against
objectives on a monthly basis. All objectives will be
quantifiable and measuable, and as necessary adjustments
will be made and monitored accordingly.
Such scrutiny of performance will allow us to constantly assess
and respond to any possible shortcomings and to market
needs.
Our management is committed to deriving a large portion of its
personal income from serving clients as opposed to relying on
management income. This should preserve our cash flow and
insure its growth.
BIOGRAPHY OF STANLEY J. CATERBONE
Stanley J. Caterbone is currently proprietor of S. J. Caterbone
Associates, a Financial Planning Firm specializing in but not
limited to upper income individuals. He is also president and
founder of Pro Financial Group, LTD., a firm providing financial
services and contractual negotiations to Professional Athletes
and Agents.
Stan began his career with a financial subsidiary of American
In
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TI=\UMIKER WILL
IM= 025P01.CPR
DA= January 8, 1987
AT= CORRESPONDING AUDIO TRACKS:
PA= PAGES:
2
SU= SUMMARY: Letter to Stan Caterbone from Dore Valvanes,
discussing certain strategies for the Estate Planning of Dr. William
Umiker, of which Stan Caterbone has been providing
Financial Advisory services for the past 2 years.
Dr. Umiker was the mentor for Stan Caterbone, and Stan
Caterbone was named the Tustee for his Estate, valued in
$ millions.
IM= 025P02.CPR
DI= PAGE 2
***************************************************************
TI=\FMG ADVISORY RIA
IM= 026P01.CPR
DA= January 13, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08
PA= PAGES:
2
SU= SUMMARY: Letter from Pual Schwartz, Acting Director, Division
of Licensing, PENNSYLVANIA SECURITIES COMMISSION. The
letter discusses the status with the applaction of
FMG Advisory, Inc., for status of a Registered
Investment Advisor.
IM= 026P02.CPR
DI= PAGE 2
***************************************************************
TI=\ROYER LETTER OF INTENT
IM= 027P01.CPR
DA= January 14, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
1
SU= SUMMARY: A letter from Carolyn Royer to the principals, Hartlett,
Kauffman, and Caterbone. This letter was intended to
provide motivation for Kauffman and Hartlett to comit
to compensation and a position in the brokerage
department. Caroly Royer went throuth the difficult task
of passing the test for the Series #24 license, inwhich
a position and salary would follow. Of course they
lied. Carolyn Royer resigned several weeks later.
***************************************************************
TI=\SERIES #24 EXAMINATION REPORT OF C. ROYER
IM= 028P01.CPR
DA= January 15, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
1
SU= SUMMARY: Carolyn Royer's Series #24 Examination Score
Report.
***************************************************************
***************************************************************
TI=\HIGH ASSOCIATES Ltd. REQUEST FOR FINANCING
IM= 033P01.CPR
DA= February 3, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
1
SU= SUMMARY: At the request of Bob Long, Stan Caterbone writes
to Tom Kyle, of High Associates, whom is a Board of
Director of American Helix, which Stan Caterbone is
partners in the "Digital" technoloyies industry. Tom
Kyle had requested information of financing capabilites.
High Associates is the largest real estate developer in
Lancaster County.
***************************************************************
TI=\ROYER -- FMG, Ltd., CONFLICT
IM= 034P01.CPR
DA= February 5, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08
PA= PAGES:
1
SU= SUMMARY: Continuing efforts by Carolyn Royer to only what she
was promised by Kauffman and Hartlett.
***************************************************************
TI=\FMG, Ltd., BOARD MINUTES OF 02/10/87
IM= 035P01.CPR
DA= February 10, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08
PA= PAGES:
2
SU= SUMMARY: Robert Kauffman drafts a very "agressive" letter to
Carolyn Royer, and asks for input. Letter was
embarassing to Stan Caterbone.
FSC terminates contract with Kauffman. Kauffman had
been collecting compensation from both FMG, Ltd., and
FSC of Atlanta. Stan Caterbone had urged Kauffman to
communicate to FSC in as early as April of 1986, that
FMG, Ltd., would eventually terminate its Broker Dealer
contract with FSC. Kauffman never did in order for $$$.
IM= 035P02.CPR
DI= PAGE 2
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TI=\SHENDEL REQUEST FOR FINANCING
IM= 036P01.CPR
DA= February 10, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
1
SU= SUMMARY: A letter requesting financing for several projects.
Leonard Shendell is an investment banker, with several
different firms, located in Dressher PA. A few projects
were seriously considered. Esbestos contaminiation
had ruined one deal.
*************************************************************
TI=\FMG, Ltd., BOARD MINUTES OF 02/11/87
IM=
DA=
AT=
PA=
037P01.CPR
February 11, 1987
CORRESPONDING AUDIO TRACKS: 01/02/04/07/08
PAGES:
2
IM= 044P02.CPR
DI= PAGE 2
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TI=\FMG, Ltd., BOARD MINUTES OF 03/26/87
IM= 045P01.CPR
DA= March 26, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08
PA= PAGES:
02
SU= SUMMARY: Board of Directors meeting discussing Hibbard
Brown deal. Board agrees to meet on a regular monthly basis
to facilitate the reorganization of FMG, Ltd.,. which
Kauffman pursued in order to get equity and control to
both Shcuttler, Hibbard, and Turner, his "Born Again"
accomplices. Meetings were scheduled with Jeff Jamouneau
by Stan Caterbone to discuss the reorganization.
IM= 045P02.CPR
DI= PAGE 2
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TI=\FSC VS. KAUFFMAN CONFLICT
IM= 046P01.CPR
DA= March 26, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08
PA= PAGES:
2
SU= SUMMARY: Formal letter from John B. Keeble, of Financial
Service Corporation (FSC) citing the contractual
and fiduciary responsibilities of Robert Kauffman with
respect to the recent request to terminate the licensing
agreements of FMG, Ltd., and its registered
representatives and to transfer the respective license
agreements with Pete Hibbard's Hibbard Brown and Company.
FSC will take legal action against Kauffman and FMG, Ltd,
if not resolved by April 1st, 1987.
IM= 046P02.CPR
DI= PAGE 2
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TI=\J. KEEBLE (FSC) LETTER TO ALL REPS
IM= 047P01.CPR
DA= March 26, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08
PA= PAGES:
01
SU= SUMMARY: A letter to all licensed representatives of FMG, Ltd.,
from John B. Keeble, Pres, Don Aultman, VP, and Steve
Franklin, VP of FSC, outlining legal implications of
Robert Kauffman's attempt at terminating his contract
and transferring all Registered Representatives Licensed
Agreements to Hibbard Brown, Broker Dealer. John Keeble
also enclosed the recent letter sent to Kuaffman with
regards to legal action, fiduciary responsibility, and
contractual obligations.
************************************************************
TI=\SEAPORT VILLAGE SYNOPSIS FOR POWER STATION
IM= 048P01.CPR
Format
Mixing
Defied Theory
Designed Sound - Voyeger
Produced Star Wars Album - Mixed
5. French Lick - MTV may sign
Free Promotion
II.
Technology
1.
2.
3.
6.
2 = $l80,000,000
2.
3.
4.
IV.
Sony
l.
a.
b.
Needs help
Low profits
Beta Bust
2.
3.
4.
a.
b.
c.
5.
Creation - 4/11/87
11:00 - 1:00 a.m.
Stan 98%
1% Scott - Call Ron Gell
Research Sony
1% Marcia - Sony give 4 million
Raise 15 Million
Call Head of video distribution
Merchandising - Hang Ten Off/Kodak
/Sony Difference test visa add in
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TI=\KAUFFMAN CONGRATS TO S. CATERBONE
IM= 052P01.CPR
DA= April 13, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/04/
PA= PAGES:
1
SU= SUMMARY: Congratulations letter from Robert Kauffman to Stan
Caterbone on his commissions of $86,466.11 for the
fiscal year ended March 30, 1987. FMG, Ltd, had
accumulated $815,000 om Gross Commission Income (GCI)
for the first quarter, which can be extrapolated to
approximately $3,260,000 in annualized commissions.
Historical statistics indicate that financial services
companies are often valued at One (1) times GCI or
$3,260,000 by Industry standards. This would value the
250,000 of stock at $13.00 per share.
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TI=\BOARD INVITATION TO SATTELITE DIRECTORS
IM= 053P01.CPR
DA= April 14, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08
PA= PAGES:
1
SU= SUMMARY: Letter from Robert Kauffman to the Sattelite affiliates
of FMG, Ltd., inviting them to the Board of Directors
Meeting to be held at Dempsey's Restaurant, Lancaster, on
May 5, 1987. Agenda includes update of FMG, Ltd.,
Profit Participation Plan, Restructure of FMG, Ltd, to
include national expansion, and private syndications.
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TI=\FMG ADVISORY BILLING
IM= 054P01.CPR
DA= April 21, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08
PA= PAGES:
1
SU= SUMMARY: Memo to all affiliated persons of FMG, Ltd,. regarding
the billing procedures for the Registered Investment
Advisor, FMG Advisory, Inc., which Stan Caterbone is
President, and for FMG Accounting, of which Stan
Caterbone is responsible for the daily operations.
************************************************************
TI=\FMG, Ltd., NEWLETTER 04/14/87
IM= 055P01.CPR
DA= April 14, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/04/07/08
PA= PAGES:
I'm afraid that as we go further and further there will be a need for
such information especially with what has happened this past week with
our corporate officers and board. First I would like to begin back in the
very beginning so that the full scope of our activities seem to fit into
one place and also so that some of the issues that have come up
are tied into what has happened up to this point.
First of all, I started in the Financial Planning Industry back in 1982.
After getting out of the contracting business I took six weeks and
traveled across the country and came back and decided to get into
the financial services industry. Being that several relatives have had
dealings with IDS, Investors Diversified Services, I called the local
branch in Rohrerstown upon finding the manager named Robert
Kauffman. Bob spent some time with me, decided he wished to hire
me, and that began the process.
I was actually licensed in 1982 for securities and life and was put
under the management of Bob Kauffman. Shortly thereafter, I would say
probably in June or July, Bob was promoted and took a division in
Tampa, Florida. Myself and three or four other individuals who were
under management decided that we wanted to form a group
together so we talked to another district manager, Steven H. and decided
that, if he would allow, we would like to put an office together with him.
At this time we did not have an office and he was working out of a
small office in Millersville. The people who were with me was myself, Mike
Hartlett and Alan Loss.
The three of us were very, very large producers, especially Mike and
Alan. The three of us were probably larger than Steve's district at
that time, so at that point we located an office at 255 Butler Avenue, we
walked under Steven H. district which increased his income by at
least 30% to 40% upon that transaction.
After being involved in the business I decided that financial planning
should be more objective and fee based, so I became one of the
larger fee producers using fees as well as commission income. At about
the same time, I became involved in the International Association of
Financial Planners. At that time the local chapter was just being
formed and I volunteered my services to help on the board. Members of the
board, at that time, was just being formed and headed by John
Herr.
I became executive vice president and virtually helped run the
chapter and helped build it to its largest membership. That gave me the
opportunity to meet other people, broaden my horizons and
education as far as the financial planning industry and just
how the independent planners fit into the stream of the industry. I
had quite a bit of activity and did alot for the local chapter and became
very involved.
Over the next several years I made a very good living. I was never
a very big producer, although one of the bigger ones in the Harrisburg
division. But I was not the biggest, but the premier fee producer for
the division and was one of the leading in the country at that time.
I shortly became knowledgeable of the other products available in
the financial services industry and learned very quickly that it was
and visit him, being referred by Alex and he was very nice over the
phone, giving me a cordial invitation to come down and actually had
me set up the meeting with Ray Smith who was one of the sales
managers. I set up a two day meeting with myself and this
anonymous person, Bob Kauffman. We spent two days at FSC and what
essentially happened is that they became infatuated with Bob's recruiting
skills. On the spot they offered Bob a position within the company as far
as recruiting and head of sales management of FSC.
I resigned from
IDS January 1985. Bob remained at IDS and from October to March was
negotiating his position and pay and his compensation with FSC.
By March he actually decided to resign from IDS and he was absorbed
into the corporate structure of FSC. January 1st I resigned from IDS.
I was upstairs with Mike Hartlett, sharing an office space
and the rest of district with Alan Loss was still downstairs.
At this time, I began to build my independent practice of Financial
Planning. Basically I took 95% of my clients from IDS and began
working with them. Bob began working in the national recruiting for
FSC and started attracting IDS people to FSC.
By the Fall of 1985 I had became disappointed with my business life,
not learning enough, lonely being independent and I became
frustrated. I knew that no one in Lancaster was doing a very high quality
service regarding Financial Planning and Financial Services. To me,
Lancaster seemed to be a highly attractive market with alot of wealth
being spread out among alot of different players. No one was being
creative regarding their efforts it was just three or four brokerage
houses, insurance agents, banks and independent planners but no
one had a very strong position or dominance in the financial services
industry.
I visited with Bob Kauffman in the Fall of 1985 as I usually did every
couple months and told him I wished to do something else. At that
time he asked me if I wanted to come down to Atlanta and help him
work on the concept of company owned shops. When I was down
there, he mentioned several positions in the corporation that I may
be interested in and he set up a meeting with me and Steve Franklin.
Steve apparently needed someone to manage his national sales
office so being down there I spoke to him, just to verify what was
available.
At this meeting, Steve Franklin more of less indicated that I was a
"burned out salesman" who was just looking for a place to go.
Nothing ever happened and I left the meeting with very little respect for
Steve Franklin.
Bob offered me a position within his company owned store, writing
cases doing plans, doing some other things. That was early
October. For the next three or four weeks I prepared myself, reluctantly, for
the transition and moved to Atlanta and tried to maintain clients up here
as well, and pursue whatever Bob was doing down in Atlanta. As
time went on I felt I really didn't wish to move away from the area and
that maybe the opportunity down there wasn't what I thought it was, or
wasn't what Bob said it was.
On November 27 or 28 of 1985, I had a meeting with Bob Kauffman and
Mike Hartlett at Morton's Restaurant on the Rohrerstown Road,
Lancaster, PA. The purpose of the meeting was to find out if we
could collectively put together something in Lancaster with regards to
financial planning. I would say that meeting was more of an effort
on
my part than anyone especially Mike Hartlett. Mike was, at this time,
also independent, left IDS and followed me to FSC along with Bob.
The meeting was on the morning at 9:00 a.m. and we discussed
what options we had as far as putting something together in
Lancaster.
I guess the basic reason for the meeting was to see if Mike Hartlett
wished to do something together with us. At this time I was
operating my practice, Mike was operating his practice, and the only thing
we had in common was a reception room adjoining our offices. At
this time Bob saw that if we could put something together in Lancaster
he could probably fulfill some of his recruiting requirements, giving him
a place to actually recruit people to rather than using FSC in Atlanta.
So that began the process of putting together a shop in Lancaster
and Central PA. I began to recruit from that point forward into our so called
planning
firm. At this time the planning firm was going to be comprised of
financial planners. Some of the first people that
I talked to was Mona Rishel, Dick Sherbahn, and Bob Long. I spoke
to other planners about joining our firm and then I got the idea of
adding other professionals mainly legal, accounting,
real estate and maybe insurance. It was then that I got the idea for
the one stop financial firm. To me it seemed apparent that it was
important to have all the individuals working together collectively to manage
one financial affairs. It didn't seem that difficult to accomplish that if you
had the right individuals willing to take the risk of attempting such a
project and who had the clientele where they didn't have to rely on
attracting new clientele.
Well, one thing led to another and we soon began to recruit and
attract new and sizable group of individuals. I probably was responsible for
recruiting 90% of the local people and outside people, Mike was
working with Rick Volpe in Philadelphia who he worked with at IDS,
and a host of others. The initial core was myself, Mike, Mona, Dick
Sherbahn. At this time I ran into Scott Robertson at the Three Mile
House who was working with Asset Management. I expressed the
idea to him and he became interested and became one of our
people. I also talked to Carolyn Royer who was with Pru Bache and
she was interested in joining. By February we had a fairly large
group of people who were willing to commit. First thing we had to do was
find facilities and Mike found the place available at the Oregon Pike
location which was just under construction. At first we were looking
for 2,000 square feet to house four or five individuals. At this time I
talked to Tim Lanza, people at -----------the legal firm, and Danny Berger as
far as doing something with real estate. It was supposed to be
an operation financed and supported by FSC. From December until
May FSC was promising fund to finance the operation. We needed
start up funds for furniture, computer systems, salaries for myself
and Mike for managing the operation. What happened during this time
was that FSC was constantly promising us financing and we had yet
to receive any actual money and the invoices submitted were never
paid by FSC.
Bob Kauffman was the liaison and apparently was being directed by
Steve Franklin and John Keeble. From what I have learned over the
past several years was that they never really intended to finance the
operation but they were stringing us along and using us to recruit
essentially what happened is that Owen ran into alot of trouble and
a few months ago I was given Owen's name and he wanted me to
raise both debt and equity for him. Whereas one year ago he wouldn't
even continue any conversations with me. I believe this gives you an
indication that a lot of the people in this community are very close
minded and narrow minded and unless you are a member of the
Country Club or the Hamilton Club, or unless you come from a
family of wealth, you don't receive very much attention or consideration
and you are really just another person on the street. Most of the people
in this community whom I am referring to do not have the business
savy to be able to detect opportunity when they see it.
I would like to talk about the division of labor between me, Mike and
Bob before I get to far into this. First of all, I was probably the
mediator or negotiator with putting the deal together. I was the middle man.
I was in touch with Bob and Mike and those two were not in very
close communication with each other. I was also giving Bob the
conceptional outline for the project and he was in Atlanta finding the
details, such as financial planning software. What I soon learned
was that because of Bob's management capabilities and because he has
been in management for so very long he really didn't have the
technological expertise about the business. His expertise came from
other people so it was always second and third hand and essentially
what happened with alot of the issues I had to go back and retrace
and research myself trying to get the accurate information as it was
second and third hand before it got to Bob Kauffman's hands.
The division of labor was that Bob was to be the president of the
organization - he was to be the manager. Mike was going to be the
chief financial officer, and help with a little recruiting and help with
the staff. I was going to help negotiate, recruit - I guess I was intended
to be alot of things. However, I can't remember precisely what at this
time, but I virtually had my hands in all area. One of the things that
I recognized early on was the necessity to have Bob Kauffman
actually come here and manage. When we started, Bob was supposed to
stay in Atlanta but when we started to get into substantial size, I would
not or could manage and I don't believe Mike could. The only way I
would do the deal is if Bob came up here and managed. Bob was going
to be president and in the negotiations it was very difficult because
both Bob and Mike didn't want the other getting more than
themselves.
I was always in the middle always giving more than getting and what
ended up is for Bob to come up here he had to have more; he had
to be president. With three people involved, I agreed on this because
to get three people to agree on issues is almost impossible. You need
one person to make decisions, and we decided to allow Bob to have
this capability.
Bob was going to receive 60,000 shares, I was to receive 40,000 shares
and Mike was to receive 40,000. Also, Mike and I were to receive
$3,000 per month and Bob $5,000 per month. Bob and I had a deal
as I did not believe he should have more of the company than
I because I put it together. We had an agreement whereby I could
buy 10,000 shares of his 20,000 at anytime at cost so we would both
have 50,000 shares. I had papers drawn up to that, however, when we
began to have problems, I left things drop by the wayside.
Back in February 1986, I became good friends with Mary Lynn
DiPaolo, Kevin's sister and Mike's wife. We were always good friends, but
back then when Kevin left, we became very close because I spent alot of
time with them. Mary Lynn was at the time, 30 years old with three
children, and she was always very tied down with the kids, basically a
housewife. She never really had a job, never worked. It was hard
for her because most of her other friends were out working and had
careers. I asked her if she would like to help me out for a few hours
a week doing general clerical and typing. She was very excited. I
thought it was a chance for me to get some things done and I liked
Mary Lynn alot and we got along and I thought it was a chance for
me to get a few extra things done.
I took her on in February and before too long she was working 30
hours a week. She had a babysitter lined up for the kids, and it was
very encouraging for me to see her do this because it gave her the
confidence for the first time that she could do something other than
just have children. She was having a great time and I was having a
great time and we enjoyed working with each other. At that
time, Bob invited Mike and I down to the annual conference in
Tucson, Arizona and with the conference arrangements we were allowed to
take someone, such as your spouse. I asked Mary Lynn if she wanted to
go and I don't believe she was ever on a plane before and she
asked Mike and he said it would be good for her to meet some of these
people and get involved with a career. We ended up down at Tucson
and that was in April 2 and we spent four or five days there.
Upon meeting Bob I told him I was bringing Mary Lynn out and I
knew from the start that this was a sore spot. First of all she was
married and he couldn't understand what she was doing out there
with me. Second of all he didn't appreciate the whole situation when he
met her he said something to the effect that she looked very young.
After the second day we were all good friends and she was getting
along very well with Bob and Pam. In fact, Pam confided things in her
that I know Pam never told anyone. It looked as though they liked,
or at least pretended to like Mary Lynn and so anyway we all had a
good time. Bob, myself, and Mike spent most of our time in individual
private meetings trying to put this deal together and work out the
details especially with FSC. I think it was back at this time we realized that
Bob was probably going to resign from management and commit and
come up to Lancaster. I think one of the reasons why Mary Lynn
and I became very close was that she reminded me so much of my
mother in the way that she handled her kids, family and I became
infatuated with that. I liked her alot. What happened was that Mike
and Bob resented the fact that we had so much fun while we
worked. We got work done, but we went out to lunch for an hour or
so and we really enjoyed things. To them that had no place in
business. For me, as long as I got my work done, I felt
better about my work and it worked out for the best. This was a
problem and will come up later.
During the Spring of 1986 when we were putting this together I had
the opportunity to move across the hall and get additional space from
another tenant. I was going to sub-let. I did this so it would give
Mike and I additional space and give operations more space so we could
get additional people before the people was done. I moved into 12 by
18 office with reception room and I had 3 or 4 additional offices.
Nancy was working for the tenant that I was subletting and she didn't
have a job and she asked me if there was anything she could do.
Mike wanted to hire her and I said let's just try it part time with no
commitments on either side to do anything permanent when we
move in and she began part time. So we now had Mary Lynn, Nancy and
Nancy A. That was the beginning of the staff problems. The staff
was always going to have staff problems in the beginning and I can't
exaggerate the problems that we had. We had so many different
personalities, three different principals, trying to give their input. So
far as the staff was concerned, mine never counted at all. Its funny,
they always considered my input for everything else, but when it came to
staff - no way, hands off. I resented this because first
of all I brought Mary Lynn in and second of all I think I had a better
vision as far as the people than Mike did and that will come out in
the
future.
Mike wanted to hire Nancy M. as office manager and I didn't think she
had the qualities to do such a job and I wanted them to interview
Barbara Kinzer. Barbara was a teacher of mine back in high school,
teaching business, typing, clerical, later going on to work at Watt
and Shand in employee benefits. So it just seemed to be that she had
some of the qualities necessary to do a good job. They interviewed
her and they didn't like her because I brought her to the table. They
ended up employing Nancy as office manager. That is going to
have alot of problems.
I believe Nancy could have been a good employee in the right
situation, but they apparently didn't see what they should have - that they
weren't organized enough to have an office manager. I suggested early on
that we not have one and that Mike do it himself rather than us
having an additional layer, not necessary. As far as the staff are concerned,
I wish to finish up the story on the staff all at one time.
It was understood that none of us were to have our own personal
secretaries which meant Mary Lynn was not going to work for me
and Nancy A. was not going to work for Mike. I didn't agree with that,
but they were dead set against having Mary Lynn involved. Part of this
was because Mary Lynn meant so much to me and they saw that as
competition in a certain way. Mary Lynn's personality is very
outgoing, a very verbal type person who is very personable and they didn't
like that.
It was to be understood that we were not to have our own girls.
We moved into the building, they would not allow Mary Lynn to be
back in my section, however, Nancy A.'s desk was right smack up
against Mike's door. This started all the problems with Mary Lynn.
She saw that and she wished to work for me, and they were not
tremendous impact on the relationship between me, Mike and Bob.
This was the straw that broke the camels back as far as our
relationship was concerned. Ever since that happened we stopped
communicating.
That was the first move in trying to rescind my input and my control
so far as the company was concerned. As far as the staff was
concerned they had a feeling that the staff should be treated as dirt and made
this understood many times to me - this is against all my philosophy of
life.
For months, because of this attitude, there were problems with the
staff. It was because of this that the staff didn't respect them, and
it was just a mess for months.
During June, July and August, Bob was still down in Atlanta and I
was doing most of the work in Lancaster. From January until January I
took one day off for Memorial Day, one day for July 4th, one day for
Labor Day and one day for Thanksgiving. Mike Hartlett took off two
of
three weeks, leaving me to tend the shop. I was always the one doing
all the work, recruiting, stock offering,labor matters, drew up all the
contracts, drew up the offering memorandum with the help of the
attorney. It was funny that I was the only one raising the money probably 80% of the funds. I was the only one of the principals who
had outsiders investing in the company. The most they did; Bob
Kauffman raised $5,000 from his father in law, so not only did I put
my own money in I risked that of my clients. But they were willing to
accept that up front. A couple times it came down to either me
getting the money from my clients or us not having the financial ability to
pay off some of the capital resources that we had.
During September we began to have problems with Mary Lynn and the
staff and me. This was the beginning of them trying to reduce and
dilute my control of the company as far as input was concerned. It
was a very emotional and draining experience after all the work I did to
put this all together to find those two were trying to push me out. It
reached the point in October or November where they actually asked
me if I wanted to "get out." They indicated that I was not right for
management, management was not right for me, that I wasn't having
fun and all this and that. Most of that was due to their action as far
as their trying to dilute me and weaken my confidence. They
constantly made fun of me in front of all the other planners at meetings and it
was just ugly.
They also tried to interrupt my relationship with Mary Lynn
which was nothing more than a very personal, deep friendship.
No one knows this, but the trauma was so heavy that I went under
the care of a psychologist at St. Joseph Hospital, beginning November
and I was suffering a severe case of depression.
Because of
schizophrenia being found in my family, I was not afraid to go seek
psychological
counseling. I was on medication for three months. In September
they had it in their minds that they were going to get rid of Mary Lynn.
And they tried every opportunity, finally in November a week before
Thanksgiving, they fired Mary Lynn. Without cause, for no reason,
other than they just wanted her out and felt she was incapable of
whatever.
It actually reached the point where Bob and Mike went around
politicking the brokers to support them that Mary Lynn was not
doing her job which was not true. She had the complete support of all the
brokers. Maybe at times there was a case where someone was
unhappy with her performance, but in general it was a ploy, a plot,
fabricated by Mike and Bob.
After their attempt to buy me out and get rid of me so far as my
control and my interest, I held out reluctantly often times wondering if I
were going to give in and by Christmas I decided I would stick it out.
There were not other alternatives, but the money they offered me to get
out was $2,50 a share which comes out to $100,0000. I wanted no parts
of it, so by January I decided to stay.
Bob had several conversations with Bob Long saying that he was
After I
and
business matters and business activities. Scott called Tony one day
about a real estate project that he thought ---------------------. Tony
said no, but he may have another project that we would be interested
in. Scott asked me to go up to New York with him to talk about the
project and I asked what it was. He indicated it was a movie. I was
very reluctant and hesitant to do this because movies to me, tax
shelters, scams, not very economic type investment. Me being very
conservative was not attracted, but I decided to go anyway just to
get out of town, more or less just to get away.
When I got up there I was totally amazed at the caliber and the
people who we were associating with. What I found out was that we were
working with the leading recording studio in the world. There
credentials, their accomplishments were phenomenal- they were just it.
I'm not going to spend alot of time of this because just the bottom
line is what is important here. After seeing the project when I looked at
what Tony was doing, and from a business perspective there were
just so many elements in this project that were just truly amazing to me
so
far as distribution and marketing and risk and everything else.
Bottom line was a product that was worth 15 to 20 million dollars being
made for 4 million with the ability to be one of the leading movie, video
projects of the years.
First of all you have the leading recording studio in the world working
on the sound for the project that was going to include a follow up of
Tony's previous band who was Bon Jovi who was already one of the
hottest thing in music as far as album sales. Then you have the fact
that he was going to digitize the recording which was never done
before in the movie industry at a time when the video market is just going
bananas. Not only that, but the label that signed the band owns
MTV.
You put all this together and you've got a phenomenal business with
alot of opportunity.
Seeing this, I committed myself to the project not knowing who,
where or how we were going to raise 4 million dollars but I believed in the
project so much. I guess because I saw alot of the same elements
used in FMG in this project, and even more. I got instincts when I
raised money for FMG I was still very concerned with the risk
elements to my investors but when I looked at this project the risk was even
less. Less risk, more protection with this project so I believed in this
project.
We spent seven or eight weeks developing the packaging the product
for the investors, things have happened during that time that fell into
place perfectly - the article in Rolling Stone, the marketing. It is May
4th at 4:30 a.m. and there is no doubt in my mind with the articles
in
Rolling Stone that we have the money for the movie. That project
in itself will probably put us in the forefront of the entertainment industry
within eight weeks. It is mind boggling as far as what can come of
this, but the project is done, we did something, we did not use FMG, they
will receive no split. I guess what I'm saying is that because of the
way Bob and Mike treated me or pushed me to go out and do
things, that did not involve FMG and I did not feel that they did not deserve
to become a part of these things. From the beginning I knew FMG was
going to get their piece.
Let me go back to an earlier development concerning the
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financial services center. Stan Caterbone will later propose the deal
to Dave Cook, of Turkey Hill Industries, who is very much
interested in deal, and has done business with Dave
Schadd in the past.
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068P01.CPR
May 11, 1987
CORRESPONDING AUDIO TRACKS: 01/02/04/07/08
PAGES:
1
SU= SUMMARY: The Planner Schedule outlines the charter flight schedule
of Stan Caterbone's plane, and his flight log to Atlanta, Georgia.
After Stan Caterbone directed FMG, Ltd., to rescind the ilegitamate
and current merger with the Hibbard & Brown Company, Stan Caterbone
decided to personally visit the Broker Dealer of William Koegler, of
Atlanta, GA. Stan Caterbone was familiar with Bill Koegler's operatation
because of his work with the International Association of Financial
Planners (IAFP). Many of the planners that served as National Chaimen
of the IAFP were part of Bill Koeglers group. Bill Koegler also was
a with John Keeble at FSC, in Atlanta. Stan Caterbone was well aware
of the quality of products and services that they had to offer.
Stan Caterbone also invited attorney Randy Grespin to accompany him in
an effort to work on the affiliation of The Underwriters Group of
Harrisburg for possible insurance product. Stan Caterbone had been
working with the president, Tony Pascotti, on a number of different
projects.
Randy Grespin had agreed to pay Stan Caterbone for 1/2 of the charter
costs for the use of Stan Caterbone's plane. Stan Caterbone would
recieve approximately $600.00 from The Underwriters Group for the
charter service.
The meetings were very productive, and it is here that Stan Caterbone
made a personal evaluation that the Planners Group would be the best
firm to develop a merger/acquisition on the grounds of service, support,
and reputation.
This meeting set the groundwork for the proceeding merger acquisition
deal with Bill Koegler.
Immediately upon the return, Robert Kauffman made an announced visit to
the residence of Stan Caterbone outraged and yelling "Who is running this
company?" Stan Caterbone replied " I don't care who is running this
company, as long as it is for the right reasons".
Bob Kauffman then asked Stan Caterbone to approve his new management
contract, which included undeserving financial elements. Stan Caterbone
quite emphatically opposed to having Robert Kauffman being compensated
on business that was the direct and exclusive results of Stan Caterbone's
efforts.
This set the stage for Robert Kauffman to find a way to get rid of
Stan Caterbone, no matter what it would take.
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TI=\JOINT VENTURE PROPOSAL WITH SONY FOR DIGITAL MOVIE
IM= 072P01.CPR
DA= May 25, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/04/05/06/07/08
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11
SU= SUMMARY: The original SONY deal that was developed by Stan
Caterbone for the development of feature films, video,
and thatrical productions utilizing the new DIGITAL
Technology that was developed by Tony Bongiovi and Power
Station Studios. Stan Caterbone created a business plan
that would include the manufacturing of hardware systems
INTRODUCTION
SONY'S ROLE
PRODUCT DEVELOPMENT
MARKETING AND DISTRIBUTION
APPENDIX
INTRODUCTION
Tony Bongiovi and Power Station Studio are undertaking a
project that has the potential of revolutionizing the entertainment
industry. In the next few pages of this proposal, I will outline the
elements involved and how Sony can participate in this
landmark event.
The technology of the recording industry has been advancing by
leaps and bounds. We have seen the advances from monaural
long playing record to stereo record to compact disc. Now we
are seeing tape systems that use digital rather than analog
signals appear, matching the quality of compact discs. What
has happened to the theatre's? The audio portion of a film, is
as responsible for the sensations one experiences at a motion
picture as the visual, yet many theatre's are still
equipped only for mono sound. Why is this? We feel there are
two basic reasons.
1> The relative high cost of upgrading a theatre to be able to
incorporate the advanced technologies of the audio industry.
2> The lack of proper equipment for the film industry to
produce high quality digital audio tracks.
These two problems should not be addressed separately. There
is little motivation for upgrading until the product is available and
even less motivation to produce a product that can not be
heard.
Tony Bongiovi and Ed Evans at Power Station in New York,
have now made it possible to address these problems
simultaneously. Their creation of the new "Power Station Digital
Movie Sound" (PSDMS), will not only enable the film industry to
produce the highest quality audio tracks for film, but will also
allow theatre's to upgrade their existing sound system at a
minimal cost.
To introduce this revolutionary new sound, Bongiovi is in the
process of producing a film entitled "Mutant Mania", which is a
science fiction action horror film, shot in a small ocean resort
town in New Jersey. This film has many elements that make it
perfect for the introduction of PSDMS. The most prevalent of
these being the heavy music score by Bongiovi's latest band
"French Lick". Producing bands is definitely one of Bongiovi's
fortes. Bongiovi was instrumental in creating "Bon Jovi" who is
probably the strongest force in the rock and roll circuit today.
"Bon Jovi's" third album "Slippery When Wet", has sold more
copies in a short period of time than any other band in history.
Another is the fact that this is a horror film. The use of audio in
horror films is important to create tension, fear, excitement etc..
Using a horror film also lessens the influence the critics have on
the audience.
By the large this film will stand on it's own merits.
PSDMS, and you have a potential block buster event.
Now add
PRODUCT DEVELOPMENT
Bongiovi and Evans at Power Station have developed a
revolutionary hybrid mixing console to penetrate the video post
production market. This console was developed to enable
engineers to produce high quality audio tracks for the film
industry as well as the recording industry. This new console
utilizes an automation system that can be used by both
industries. This new console is especially atractive to the
film industry, as it will greatly reduce production costs since
mixing costs in a recording studio are much less. At present
the console that is being used is a bastardized system that
utilizes components from many different pieces of equipment,
from a number of different companies, of which Sony is one.
Because we already have a working model of this console, it
would take very little time for a finished product to be
manufactured that could carry the SONY name.
The other piece of equipment that is essential to the PSDMS
process, is the box that enables the laser disc to automatically
read the synchronization track encoded on the film. This piece
of equipment can be produced at an extremely low cost. It is
this low cost and the fact that the theatres will not have to
replace their present projectors that make digital movie sound
a reality in 1988.
We feel that with consumers demanding the same quality audio
at theatres, as they have become accustomed to with their
home entertainment systems, theatre owners will have little
problem investing the nominal amount of dollars involved, to
upgrade their theatres for digital audio. This investment could
be as low as $1000.
With the cost being so low, the distribution company may want
to consider bearing the burden of this cost, if the theatre owners
agree to show Bongiovi's next three films.
FINANCIAL STRUCTURE
SONY will commit four million dollars for the production of
Bongiovi's film to be released in 1988.
We would like SONY to commit fifteen million for three to four
future products that will follow the same format as the first, so
that Bongiovi and SONY will position themselves as the pioneer
and leaders in the industry. This will not allow competition to
gain access to the marketplace until we are all firmly situated
and profitable.
Sony will only pay for expenses to produce 60 second spots.
Tony and Power Station will utilize any and all services to help
produce the spot and will allow reimbursement for only true
costs with no mark up including all of Tony's time which will be
free.
Power Station and Power Productions I will receive a negotiated
percentage from all revenues generated from the merchandizing
campaign of the SONY/POWER STATION products and the
sale that may result to other film studios utilizing Sony/POWER
STATION equipment in the PSDMS System.
We will receive four deluxe entertainment systems - Television,
VCR, Stereo, Etc. that is top of the line to help during the
production of the film.
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Stan Caterbone left the conference early in order to meet with Marcia
Silen, one of the producers for Flatbush Films. Stan Caterbone had
disclosed the original draft for the SONY joint venture proposal.
Stan Caterbone and Marcia Silen collaborated on the proposal and
Marcia Silen said "Stan, you are a genius".
Stan Caterbone also visited with Becky Austin, Marcia Silen's sister, and
discussed the mortgage banking business. Becky Austin was a paralegal for
one of the more active law firms specialinzing in Real Estate in Beverly
Hills. Becky and Stan discussed a strategic alliance that would result in
the development of an office in Beverly Hills for the loan portfolio of
Institutional Investors. Al Dannatt was consulted, and a futere meeting
between Stan Caterbone, Becky Austin, and Al Dannatt was agreed upon either
in Houston, Texas, or Beverly Hills, CA. Becky Austin was very experienced
in the Beverly Hills real estate busniness, and had a great of connections
that would have been required to pursue such a business.
Marcia Silen had tried to schedule a meeting between Ted Gamillion of
Gamillion Studios, and Stan Caterbone, however schedules were not
permitting. The meeting would later take place on July 21, 1987.
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TI=\FMG, Ltd., NEWSLETTER OF 5/26/87
IM= 078P01.CPR
DA= May 26, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
2
SU= SUMMARY: Michael Hartlett welcomes the association of Craig
Russel and the law firm of Russel, Kraft, Gruber, and Huber to
FMG, Ltd,. Michael Hartlett had proceeded with structuring a deal
with the Craig Russell, without any considerations by
Stan Caterbone, principal, or the Board of Directors.
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TI=\W. UMIKER ESTATE PLANNING
IM= 079P01.CPR
DA= May 28, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
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SU= SUMMARY: Letter to Dore Valvanes regarding the Power of
Attorney of Dr. William Umiker.
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TI=\FLATBUSH FILM DRAFT SCREENPLAY OF DIGITAL MOVIE
IM= 323.CPR
DA= May 29, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
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SU= SUMMARY: Letter and first draft of screenplay of the"digital"
movie in preparation for meetings in Wildwood NJ. Letter
is from Arlene Davidson of Flatbush Films to Stan
Caterbone.
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"SONY'S CHALLENGE"
04/05/08/09
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Jacobson could not make it, we had to fly him out of the
country early this morning". Stan Caterbone went on to
describe the alleged illegal and improper business
activities of James Guerin, ISC, and thier role in the
United Chem Con case. Larry requested Stan Caterbone to
find a new facility for Chem Con, and help resuce the company
PA= PAGES:
SU= SUMMARY: A copy of a Stock Certificate for FMG, Ltd., for 8,000
shares made out to Peter Peneros, with the forged
signiture of Robert R. Long signing as Secretary of
FMG, Ltd., when in fact Stan Caterbone was the legal
secretary of Financial Management Group, Ltd., Robert
Kauffman also signed as President, signifying his
involvement of violations of the Articles of
Incorporation, Corporate Bylaws, Offering Memorandum, etc
Even more importantly, Stan Caterbone had all of the
records and transfer books in his locked offfice (6/23).
************************************************************
TI=\POWER STATION PATENT RESEARCH
IM= PP1.CPR
DA= June 25, 1987
AT= AUDIO TRACKS: 04/05/08/09
PA= PAGES: 03
SU= SUMMARY: Stan Caterbone had directed patent attorney Jeff Goldhammer
to research information regarding the "Power Station" trademark for the
purpose of merchandizing various electronic equipment in both the
retail and professional video and recording markets. This was especially
important for the "Power Station Digital Music Sound" (PSDMS) that would
be an integral part for the movie.
IM= PP2.CPR
DI= PAGE 2
IM= PP3.CPR
DI= PAGE 3
************************************************************
TI=\LANCASTER AVIATION INVOICE FOR UNAUTHORIZED REPAIRS
IM= 097P01.CPR
DA= June 26, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
2
SU= SUMMARY: An invoice from Lancaster Aviation and Chuck Smith
to FMG, Ltd., for unauthorized repairs made to the aircraft
of Stan Caterbone. Stan Caterbone purchased the aircraft
with the prerequirments of a pre inspection, of which no
mention of any required or defficient mechanical problems
made during the settlement of the purchase of the
aircraft. Stan Caterbone had no knowledge of any work
performed on the aircraft until reciept of this invoice.
Another attempt to embezzle funds from Stan Caterbone.
IM= 090P02.CPR
DI= PAGE 02
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TI=\LANC AVIATION INVOICE
IM= 098P01.CPR
DA= June 29, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
1
SU= SUMMARY: A letter from Chuck Smith of Lancaster Aviation to
Stan Caterbone, demanding payment for the repairs of the
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TIME:
10:00 AM
PLACE:
PERSONS:
<STAN CATERBONE> I still am the minor one <HOWARD EISSLER> yes, the Financial Management
Group -there is about 50 names I am dealing with here
and they are all very similar so I have to be --- Financial
Management Group Ltd. filed for 202B exemption. Now
all the security sold in PA had to be registered. Some
securities are exempt but you have to apply the
detention type of thing. It is a registration, not a
registration that __________ so the 203D exemption was
filed for. Of course we have added the security
statement - explanation of where the money is going to
be spent, how it is going to be run, who runs the
corporation and all that sort of thing. Now under the
umbrella of this Financial Management Group there is a
whole (now I am repeating what is in the 203D which I
spent some time Friday reading) - there is about 15, 14 I guess under that there is about 5 other corporations
which are going to be an insurance agency, an
investment advising agency, a group <STAN CATERBONE> now a lot of these things have
not come about. Well we simplified it.
<HOWARD EISSLER> What do you mean simplified it?
<STAN CATERBONE> They are operating but because
of the accounting procedures they would have been a
nightmare with all those stubs.
<HOWARD EISSLER> So, they are operating <STAN CATERBONE> the only one that's separate
distinction is the IRA. Everything else is operating under
Financial Management Group Limited.
<HOWARD EISSLER> So these other corporations have
not really come into being.
There is a report
<STAN CATERBONE> Right, that's what is coming up <HOWARD EISSLER> to explain how much money was
raised and where it was spent with the idea then of
protecting investors. The idea of the _________ your are
limited to like 35 investors. You can't sell to 105 - you
are limited. What the state does is comes in and says,
how are you going to raise the money in your offering
memorandum. Then a year after it is raised, or a year
after _________ they come in and say, now what did you
do with the money. You raised 4 hundred and some
odd thousand, now how did you spend it? Now that has
not been filed yet.
<STAN CATERBONE> It is due, in fact I think it is
overdue. It is due October 20. I got the letter right here.
They just sent me the letter. You guys just sent me the
letter, I have it right here.
Is
The
meet with legal counsel and find out how I was going to
resolve all these problems that I was finding.
What happened was, in June I copied everything in that office
(June 30th), and I copied the books. You see, I
developed a computer system. So I just took one of the
copies - it was a big system. I've got the books. I don't
know how accurate they are because the way that the
guys kept the records, the accounting is all screwed up
too. I have an idea, but I found a lot of money going to
people that should not have been.
<HOWARD EISSLER> In what way?
<STAN CATERBONE>What they did was, there was a
lot of Jehovah Witnesses that were hired in that firm receptionist, cleaning, etc. Then what they did was
replace all the staff people that I brought in with their
own. Then, there was money going out to a fellow by
the name of Tom Turner in Minneapolis.
Now Tom Turner was the biggest divisional
was terminated by IDS in February because
convictions - another born-again. Then I
was making $750,000 a year with IDS and I
loaning him money?
manager in IDS.
of religious
find this guy
find FMG
He
<HOWARD EISSLER> Is that what they are going after in the form of loans?
<STAN CATERBONE> Yes.
<HOWARD EISSLER> And, how much money are we
talking about going to Tom.
<STAN CATERBONE> 12-15 grand.
going to Kauffman's wife.
<HOWARD EISSLER> Large amounts?
a hundred dollars?
I've been 4 months without money. I haven't paid a bill since June
30. What do I do? No one believes me. I tried going to
the unemployment office. Do you know what they did?
When I was in the hospital, that was over $3,000. They
called up the insurance carried and told them to
terminate me - my hospitalization. I have nothing. The
only thing I have is what is in this house.
Well, Kauffman comes up here from Atlanta, and he's a
born-again Christian, so he comes together with a group
up here somehow. You see, he's hiring born-again
people... Jehovah Witnesses. Hartlett is a Jehovah.
There were more Jehovah Witnesses than there was
anybody.
<HOWARD EISSLER> But Hartlett was somebody you
brought in though, wasn't he?
<STAN CATERBONE> Well, what happened was I put
everything together. But would it not be right to say that
Hartlett would be your person as opposed to Kauffman's
person. Well, it is those two against me. They are the
two that are trying to take the company from me. See,
I controlled everything. Everyone went with what I said
because I did things that were right for business and
right for people. I treated people fairly and honestly.
People respected me more than anybody.
<HOWARD EISSLER> Did Kauffman in the initial
offering that you had, the preorganizational offering each of you put up $20,000 - did Kauffman put up 20?
<STAN CATERBONE> He got more stock; he never
paid the other 10 for the remainder of the shares. He
was supposed to put in 30 for his 50 - $.50 a share. The
three of you put in 20. Then, he had a back agreement
with me to sell me 10; so we both would have 50,000
shares. I got that contract and he never fulfilled that.
said no way are you getting more shares than me when
I put it together. I said you can be equal with me.
<HOWARD EISSLER> But how did that come about?
<STAN CATERBONE> We signed a back agreement so
Hartlett wouldn't get mad. I had to write to buy about
10,000 shares from Kauffman, 50, to give us both 50 at
anytime at $.50 a share.
<HOWARD EISSLER> You have that agreement? Yes,
he never signed it after he got his 50. It was a bad move
on your part. There is nothing wrong with the idea but
do you think at that point he was conniving to do <STAN CATERBONE> he was conniving from day one.
When we put this thing together, I was in the middle
constantly between Kauffman and Hartlett. In fact, at
one time Kauffman was going over an idea - this was
over a year ago before we moved into the office - about
how he could set Hartlett up to get him out. Then, when
Are they
If you are no
I can't get at
All stock is
I was
Registered
Who is registered
He
I set up an umbrella so
I have a
Right there,
do.
<STAN CATERBONE> They took out the bond after July
1. I got a thing in the mail about a bond; I thought what
is going on. Then he told me about a week later - I said
that's what that is - a $4,000,000 bond.
<HOWARD EISSLER> You know the bonding
company?
<STAN CATERBONE> Fidelity.
<HOWARD EISSLER> Of course, I am thinking from
their standpoint - Financial Management Group has not
seen the $25,000.
<STAN CATERBONE> No, I don't know, maybe they
have it. They might have it.
<HOWARD EISSLER> Well, the only way they could get
it is if it were a reimbursement made on the airplane.
<STAN CATERBONE> They were the ones calling the
bank and the Aviation Company about the plane, asking
what I was doing with it, where I was going? They were
the ones that initiated all the conspiracy with the lending
institutions. My credit rating was excellent up until
August - "01" down the line, never owed anybody
anything.
<HOWARD EISSLER> This is going to drag out; I will
keep in touch with you. Now, you also have investments
through mutual funds through Financial Management
Group? And how much money are we talking about
roughly?
<BILL JOHNSON> About 170,000.
<HOWARD EISSLER> Now, do you have the certificates
for this.
<BILL JOHNSON> No, they were never issued.
are held in ________ with the broker,
They
ISC
___________,
He is really
_____________
I didn't
I took
It still
It happened
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October 2, 1987
CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
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INDEX TO WITNESSES
DIRECT CROSS REDIRECT
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WITNESS
STACY LYNN WATERS
ROBERT E. KAUFFMAN
DANIEL ANTHONY BERGER
LARRY G. MATHIAS
JUNE KEMPER
LARRY C. SIEGLER
RECROSS
3l
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7l
P R 0 C E E D I N G S
MR. BEYER: Good afternoon, Your honor.
THE DISTRICT JUSTICE: Good afternoon. We
have two Criminal Complaints charging the Defendant
Stanley J. Caterbone, here at the moment.
The charges were read at this time.
DETECTIVE MATHIAS: I understand Detective
Siegler, he is enroute.
THE DISTRICT JUSTICE: we can't proceed on
that until he is here, but we certainl can roceed on
the other. Do you have a copy of both charges?
MR. BEYER: Yes. I want to bring something to
both your attention in case I misheard it. When you
were referring to the first Complaint I think you said
it was your number 202. I don't have a number on the
first Complaint but my second complaint says 202. I
want it so we are straight.
THE DISTRICT JUSTICE: They all have the same
number.
MR. BEYER: Okay.
THE DISTRICT JUSTICE: All right. Do you have
a copy of the one filed by Detective Mathias?
MR. BEYER: Yes. And I waive that reading,
Your Honor.
25
our
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first witness?
DETECTIVE MATHIAS: First, Your Honor, we
would like to dismiss the robbery charge. In consultin
with the District Attorney's Office, I was directed tha*
that would be the proper thing to do in this case.
THE DISTRICT JUSTICE: In other words, you're
going to withdraw the robbery?
DETECTIVE MATHIAS: Co*rect.
THE DISTRlCT JUSTICE: And not pursue that.
Cross it off, everyone on their Com laint. And who is
the District Attorney who authori*e* that?
DETECTIVE MATHIAS: District Attorney Totaro.
THE DISTRICT JUSTICE: T-0-T-A-R-0?
DETEcTIVE MATHIAS: Fi*st name is Donald.
THE DISTRICT JUSTICE: The others stand, do
they?
DETECTIVE MATHIAS: Yes.
THE DISTRICT JUSTICE: Now, we will have the
first witness.
DETECTIVE MATHIAS: At the re*uest of the
defense, we are *oing to se*uester the witnesses.
MR. BEYER: That's correct, Your *onor.
THE DISTRICT JUSTICE: All ri ht.
STACY LYNN WATERS, called as a witness,
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couldn,t
Q
It was Stan Caterbone?
A
Stan Caterbone.
Q
Is Stan Caterbone known to you?
A
yes.
Q
Is that erson in the courtroom now?
A
Yes.
Q
Would you point to that person?
A
Pointing.
Q
That would be the person seated next to
counsel?
A
Yes.
Q
Okay. How long have you known Mr. Caterbone?
A
About a year-and-a-half.
Q
So it was clearl him? T
question in your mind it was Mr. Caterbone that you were
talking to that night?
A
No.
Q
What night was it; do you know?
A
A Thursday night.
Q
Thursday. Did you -- did something happen
that evening after that, after you left Stan into the
building?
A
Yes. He told me that he had come to take
some files that were his and take some pictures and so
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He went into Mike Hartlett's -Q
Mike Hartlett?
A
His office.
Q
As a result of what ha pened that ni ht with
Mr. Caterbone, were the police called? As an end result
of that happened, whatever you're going to tell us right
now, were the police notified?
A
Yes.
Q
Okay. Did you provide the police with a
statement?
A
Yes.
THE DISTRICT JUSTIcE: can you say when were
the police notified? Like a year later
0r that very
night? Or do you know when?
A
I didn't notify the police
BY DETECTIVE MATHIAS:
Q
They were notified within an hour or two of
what you are talking about now?
A
Yes.
DETECTIVE MATHIAS: Okay. The reason I'm
asking, Your Honor, is she provided a statement and I
think it is a very complicated case and I would like to
introduce her statement so she has it with her.
THE DISTRICT JUSTICE: The police were
notified almost immediately then, is what you are
PAGE 8
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saying?
2
DETECTIVE MATHIAS: The police were notified
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within a reasonable time frame of the crime.
4
THE DISTRICT JUSTICE: Now she stopped that
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Stan went into Mike's office.
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to the witness.
DETECTIVE MATHIAS: 0kay.
BY DETECTIVE MATHIAS
Is this the statement that you given to
the police and to me, as a matter of fact, on the date
of this incident?
A
Yes.
Q
I want you to have that so you have it there
with you for your reference if you need it. Now would
you continue. What happened that evening, if you can
explain?
A
0kay. Then he had a screwdriver. He pried
open Mr. Hartlett's desk.
Q
When Stan came to the building you said you
left Stan Caterbone into the buildig?
A
Yes.
Q
And then you said he went into someone else's
office? Or some office?
A
Yes.
Q
How did he get into that office?
A
It was open.
Q
Okay. At any time did he go into any offices
that weren't open that he had no ritht to be in?
A
None that were not open.
Q
Did he go into any offices that were locked?
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A
No.
Q
At any time did he go in?
A
To the basement, but that was the only one
that had to be unlocked. The hallway that we were in
was locked.
Q
I see. How did he get into the hallway?
A
I had the keys and he got them out of your
hands and unlocked it.
Q
He took the keys from you*
A
Yes.
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Q
You didn't give them to him?
A
No.
Q
If he would have asked you for the keys,
would you have given in?
MR. BEYER: I object. That's speculative.
DETECTIVE MATHIAS: Okay.
THE DISTRICT JUSTICE: Somebody is going to
ask the question. Did he forcibly take them from you
A
Yes.
THE DISTRICT JUSTICE: Go ahead.
BY DETECTIVE MATHIAS:
Q
After he took the keys from you?
A
Yes.
Q
What happened?
A
Then we went -- well, we walked around and he
PAGE 11
1
showed me some things that he had in a bag, papers.
2
Q
What were they that he showed you?
3
A
That he had in a bag with him.
4
Q
That he had with him?
5
A
Yes.
We went into an office, he showed me
6
these things.
They were papers of charges that he had
7
against Financial Management Group and I don't remember
8
the other things.
And then we went to Mr. Hartlett's
9
room -- office.
10
Q
Explain if you can -- what we want you to
11
understand, see, some if the people here don't have any
12
idea what happened that evening at all and we are trying
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to explain the story to them so they understand that
14
happened.
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Okay .
16
Q
Okay .
Now he went into Mr. Hartlett's
17
office?
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A
Yes.
19
Q
That happened there?
20
A
Then he took out a screwdriver and he pried
21
open the desk and started taking files out.
22
Q
He did?
23
A
Yes.
24
Q
Did he remove an thin
from those desks?
25
A
The files.
PAGE 12
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Q
What happened to those files?
What did he do
2
with those files?
3
A
He carried them with him as we went to
4
another office and then we took the files out to the car.
5
car.
6
Q
Okay.
You're saying he took the files to his
6
vehice,
7
his car?
8
A
Yes.
9
THE DISTRIcT JUSTICE: He or We?
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A
He.
I was with him but, I mean, he carried
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I was with him the whole time.
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THE DISTRICT JUSTICE: You went out to his
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A
Yes.
He had me -- he had my arm.
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BY DETECTIVE MATHIAS:
Q
What do you mean?
He forced you to go with
him?
him.
MR. BEYER:
I obiect to the form of the
question.
THE DISTRICT JUSTICE: Well, just tell the
young lady to tell us exacty what happened.
DETECTIVE MATHIAS:
Yes.
BY DETECTIVE MATHIAS:
Q
You said you went to the car with him?
A
Yes.
PAGE 13
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Q
Why did you go to the car with him?
2
A
Because we didn*t
o to the car ri ht
3
Mr. Hartlett's office.
First we went to Mr. Kauffman's
4
office.
He took
ictures of some files and
oo
5
more files.
We went into the computer room. He took a
6
disk.
And when I went to use the phone
then he took
7
my arm 'cause he didn't want me to call anyone.
Then he
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had me with him the rest of the time and then I
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accompanied -- was with him when he went out to the car.
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Q
You said you went to call someone
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A
Yes.
The police.
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Q
Why were you going to call the police?
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A
Because, I mean, I was told that he was not
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to be in there.
And he was taking files.
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Q
What happened then?
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Then he came out and he took me by the arm
17
and took me back to the office with him.
18
Q
He took
ou back?
If you would have
19
wanted to leave, could you leave?
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MR. BEYER:
I obiect to that it's speculative too.
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THE DISTRICT JUSTICE:
Rephrase it.
22
BY DETECTIVE MATHIAS:
23
Q
Why didn't you leave?
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A
Why didn't I leave?
Because he had my
25
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Q
And he wouldn't allow you to leave?
Is that
2
what you are saying?
3
A
No.
he didn't want me to go call anyone
4
Q
So, you didn't call the police?
5
A
No
I didn't.
6
Q
What happened then?
7
A
Then, well we had to make two trips out to
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the car to take files out and then he wanted to go down
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to the basement and so we went down there and I didn't
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know I even had a key that unlocked it, but he unlocked
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it.
Then he ripped out some phone lines. We went back
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upstairs and we went into the computer room and he
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ripped -14
THE DISTRICT JUSTICE:
Did she say cut?
15
A
No. He ripped them out, just ripped them
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THE DISTRICT JUSTICE: You said ripped
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Yes.
And we went up to the computer
room and he turned the key on the computer. I don't
know if it turns it off or what it does. I don't know.
And he tore some other things out of the wall there.
then we went to another office. He ripped some -- tore
some lines out from an ADP machine and then -Q
what is an ADP machine? Do you know?
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A
It is what stock brokers use for their
2
quotes.
I don't know what all it does.
3
THE DISTRICT JUSTICE:
Did she say again
4
what he did to that?
5
A
He tore some of the cords out from it.
6
THE DISTRICT JUSTICE:
Electrical cords?
7
A
Yes.
8
THE DISTRICT JUSTICE:
Okay.
9
BY DETECTIVE MATHIAS:
10
Q
While this was going on, while this occurred
11
with Stan Caterbone being in the office areas, were you
12
scared?
13
A
I was scared to a point twice. The first
14
time was in Mr. Kauffman's office and he had my arm and
15
I was just kind of fighting to get away and trying to
16
get him to stop and just to leave. And he just -- he
17
said that I was putting up pretty much of a fight.
He
18
threatened to knock me out.
19
And then the second time was when we went down
20
to the basement and I was scared because it was dark
21
but he said that if he was going to do anythin to me he
22
would have done it by then.
23
Q
If you would have wanted to leave?
24
A
Yes.
25
Q
While Mr. Caterbone was going into these
PAGE 16
1
offices, could you have left?
2
A
No.
3
Q
Why?
4
A
Because he had a Hold of my arm. Not always
5
tight, but when I did try to get away, then he did grab
6
it tighter.
It didn't hurt me or anything.
7
Q
So, he held you?
Is that what you are
8
saying ?
9
A
Yes.
10
Q
At what point did you finally get free?
11
A
when he -- when he was leaving
out at his
12
car.
13
Q
Can you explain?
14
A
He had my keys and -- and so he had to give
15
them back but he made me go out with him and then he
16
gave me my keys back and then he made suree got back
17
in the office okay and he left.
18
Q
Is there anything you would like to say about
19
what has happened here that I haven't asked you that you
20
just want to make a comment about this whole story,
21
this whole incident?
22
A
No.
23
DETECTIVE MATHIAS:
One moment.
I have
24
25
two questions.
BY DETECTIVE MATHIAS:
PAGE 17
1
Q
One, you said that you saw him tearing things
2
out of the phone downstairs?
3
A
Yes.
4
Q
You saw this with your own eyes?
5
A
Yes.
6
Q
Okay.
And who did that property belong to;
7
do you know?
8
A
I don't know. I quess it belongs to whoever
9
owns the building.
10
Q
Okay. You said he had taken a disk out of a
11
computer upstairs.
12
A
from a file, yes.
13
Q
Actually removed it from the computer?
14
A
No.
It was in the file.
15
Q
What happened to that disk; do you know?
16
A
H took it with him. I don't know what
17
happened.
18
Q
To the car?
19
A
Yes.
20
Q
And you said he removed items from disks
21
in the offices, one of those desks he had actually
22
opened with a screwdriver.
He took things and he took
23
them with him as well?
24
A
Yes.
25
Q
In his car?
PAGE 18
1
A
Yes.
2
Q
And left.
When he left you to come back in
3
and watched that you safely returned to the building, he
4
actually left with those items?
5
A
Yes.
6
DETECTIVE MATHIAS:
I have no more
quesions.
7
THE DISTRICT JUSTICE:
Before you go ahead,
8
clarify something for me.
The Defendant didn't have you
9
by the hand all the time from the moment you let him in
10
the door -11
A
No.
12
THE DISTRICT JUSTICE:
-- until he finally
13
released you outside to go back into the office and
14
assisted out or whatever?
Is there a reason why you
15
didn't walk out the door?
Or call the police?
Or do
16
something?
17
A
Because until that I was *ust trying to get
18
him -- I wanted him to just leave and I was Just trying
19
to talk him out of taking things.
20
THE DISTRICT JUSTICE:
Go ahead.
21
DETECTIVE MATHIAS:
You do bring up the
poinT.
22
THE DISTRICT JUSTICE:
I wanted clarification
23
here.
Did he have her by the hand all the time?
24
BY DETECTIVE MATHlAS:
25
Q
After Stan grabbed your arm or held your
arm,
PAGE 19
1
from that point on?
2
A
Yes.
3
Q
Did he ever let you go that you could have
4
left until the very end, when he gave yuor keys back?
5
A
He didn't -- oh, he had like his arm around
6
my arm but when I, you know, tried to get away then he
7
held tighter.
So, I mean, I did try a couple of times.
8
Q
So could you have gotten free if you would
9
have wanted to?
10
A
No.
11
DETECTIVE MATHIAS:
0kay.
12
MR. BEYER:
My turn?
13
DETECTIVE MATHIAS:
Yes.
14
CROSS-EXAMINATION
15
BY MR. BEYER:
16
Q
Good afternoon.
You've known Stan for
17
about a year-and-a-half, I think?
18
A
Yes.
19
Q
How did you first meet Stan?
20
A
I met him first when I was doing some work
21
for my dad when he was with IDS.
22
Q
Then you knew that Stan was the executive
23
vice president of Financial Management Group?
24
A
Not at that time, I don't think so.
That was
25
a little before, but, yes.
PAGE 20
1
q
At one time you worked for FMG, didn't you?
2
A
Yes.
3
Q
What position did you have at FMG?
4
A
I was a receptionist.
5
Q
When did you start working there?
6
A
July of last year.
7
Q
Of '87?
8
A
Yes.
9
Q
And who hired you ?
10
A
Mike Hartlett.
11
Q
Did you work with Stan there?
12
A
I worked for Stan.
I did some things for
13
him.
14
Q
And you and Stan were pretty good friends,
15
I believe ?
16
A
He talked once in a while.
17
Q
And you went down to the shore to visit him
18
at his house?
19
A
No
I didn't go down
20
him.
I saw him there once.
21
Q
All right.
when did you terminate your
22
employment with Financial Mana ement Group?
23
A
I think July this year, '87.
24
Q
And why did you terminate that employment?
25
A
Because my mom had a cleanin business and
PAGE 21
1
she needed heop and I was going to work for her.
2
Q
There was a point when you were told Mr.
3
Caterbone wasn't allowed in that building - is that
4
5
6
7
8
9
10
11
12
13
14
15
l6
17
18
19
20
21
22
23
24
25
accurate?
A
yes.
Q
Who told you that?
A
Mike Hartlett.
Q
Did you know when he was officially removed
as an executive or anything like that? Or you were Just
following Hartlett's orders?
A
Yes.
He told us that he was removed as
executive.
Q
Hartlett told you that?
A
Yes.
Q
All right.
Now
when Stan knocked on
window that evening I think your initial reaction was
you were glad to see him? is that a fair state*ent?
A
Yes.
Q
And you had never had any trouble with Stan
before that?
A
No.
Q
And when he first came in the door did he
have something with him?
A
I don't remember.
I quess he had the blue
bag.
**
PAGE 22
1
Q
Okay.
He was carrying that with him in his
2
hand?
3
A
Yes.
4
Q
Would it be safe to say that Stan was rather
5
excited that night?
6
A
Yes.
7
Q
And he wanted to show you a lot of things in
8
the building?
9
A
Yes.
10
Q
And he was taking you around from office into
11
office saying, look at these files in this office, look
12
at these files in that office?
13
A
Yes.
14
Q
And, in fact, he told you look, that Kauffman
15
is now in my office and here are all his files.
He
l6
showed you that, didn't he?
17
A
Yes.
18
Q
And, you had also been aware that Kauffman
19
had all the locks changed on his office, didn't you?
20
A
I had thought that Stan had the locks
21
changed.
The outside of the doors, yes, the locks were 22
changed.
23
Q
But, you're aware that before Stan took his
24
business operations to New Jersey that he had the locks
25
changed on his own office?
PAGE 23
2
3
4
5
6
7
8
9
10
11
12
l3
14
15
l6
17
18
19
20
21
22
23
24
25
yes.
Q
But then Kauffman had them rechanged, I
guess right?
A
Not that I know of.
Q
Okay.
Did you guys go in that office?
A
Yes.
A
Had it been locked?
A
No.
Q
So, if that door was unlocked it was unlocked
before you got there that evening?
A
I unlocked it when I got there.
Q
And where did you get your set of keys?
A
I have them for cleaning for Mr. -- I think
it is Mike.
Stan gave me a key to his door.
Q
Stan gave you a key to his office?
A
Yes.
Q
All right.
Now, as he is going from office
to office picking up files, what was he doing with them?
A
Taking them.
Q
Where was he putting them?
A
He held them in his hands and then Just
Mike's, just Mr. Hartlett's files.
Q
Was he carring them.
A
He was carrying them.
Q
Now, he was carrying those and also carrying
PAGE 24
1
his Blue bag.
2
A
I don't remember if he had sat it
3
somewhere or if he had it with him.
4
Q
Okay.
can you estimate how much he had
taken
5
from Mr. Hartlett's office in terms of si*e?
6
A
About like that much.
7
Q
And that's what he was carryin with him?
8
A
Yes.
9
Q
Now, how long do you think Stan was in the
10
building that day?
11
A
It was not quite an hour.
Almost an hour.
12
Q
You were aware that Stan and the partners in
13
the business were having a problem between them
14
you?
15
A
Yes.
l6
Q
And you were aware that Stan felt as though
17
the company had taken many things that belonged to
him
18
A
I didn't know what the situation was. I
19
thought that it had calmed down and that it was pretty
20
much over by that time.
21
Q
But you're aware that Stan felt that most of
22
the stuff in there was his?
23
A
I didn't know what -- I mean nobody talks
24
about it.
I didn't know what was goint on.
25
Q
He was sayin it that night?
PAGE 25
1
2
his.
3
That night,
yes,
4
5
6
7
8
9
10
11
12
l3
14
15
l6
17
18
19
20
21
22
23
24
25
PAGE 26
1
Q
Okay.
You indicated there were two points
2
when you were kind of scared.
3
A
Yes.
4
Q
The one was *oing do*n to the basement and
5
it was dark, right?
6
A
Right.
7
Q
Had you ever been down in the basement.
8
before?
9
A
No.
10
Q
And when was the other one?
11
A
When we were in Bob's office and I was trying
12
to get him to quit and to leave and I was trying to get
13
my arm from him and he Just said that I was putting up
14
a fight and that he would knock me out and I didn't now
15
if he was serious.
16
Q
From your experience with Stan, you were
17
pretty sure he wasn't serious, he wasn't going to knock
18
you out, weren't you?
19
A
I didn't know because of the things I had
20
been told about Stan.
People had said, you know, that
21
I didn't know what to expect.
22
Q
But, I guess your initial answer was you
23
weren't sure if he was serious or not?
24
A
I wasn't sure.
25
Q
All right.
when you made the first trip to
PAGE 27
PAGE 27
1
the car, what did he take with him?
2
A
The first trip?
He took files.
3
Q
Was the trash can involved in that first
4
trip?
5
A
I don,t remember.
6
Q
Okay.
If he took files, was he carring them
7
in one hand?
8
A
Yes.
9
Q
What about his blue bag?
10
A
I don't remember what happened to the blue
11
bag.
I really don't.
I don't know if he had sat it
12
down, picked it up on the way out or what.
l3
Q
And you went out to his car with him?
14
A
Yes.
15
Q
Did he put the stuff in the car?
l6
A
Yes.
17
Q
And where were you when he was
uttin
the
18
stuff in the car?
Just standing there watching him do
19
it?
20
A
When he was putting it in the car, I was
21
standing there.
22
Q
Okay.
23
A
He had -- I was with him when he went out.
24
Q
He wasn't still holding you out at the car
25
was he?
PAGE 28
1
A
No, not out at the car he was not.
2
Q
You could have ran there if you wanted to,
3
but at that point you weren't really afraid of him?
4
A
I guess I could have.
5
Q
And, then you went back in with him for the
6
second trip?
7
A
Yes.
8
Q
And the second trip he took everything else
9
that he hadn't taken on the first trip I take it?
10
A
Yes.
11
Q
And then he gave your keys back?
12
A
Yes.
13
Q
And he waited to make sure you could get
14
back into the buildings safely because it was dark
outside?
15
A
Yes.
16
Q
And, in fact, I think the two of you might
17
have kissed goodbye?
Or a peck on the cheek? See you
18
later?
Take care?
19
A
There was a peck on the cheek.
20
Q
Okay.
21
MR. BEYER:
Thank you, Stacy.
22
DETECTIVE MATHIAS:
Recross this for a second.
23
MR. BEYER:
Redirect.
24
DETECTIVE MATHIAS:
Called redirect?
25
MR. BEYER:
Yes.
PAGE 29
1
DETECTIVE MATHIAS:
Thanks.
2
REDIRECT EXAMINATION
3
BY DETECTIVE MATHIAS:
4
5
6
7
8
9
10
11
12
13
15
16
17
18
19
20
21
22
23
24
25
Q
You commented on the first trip to the car
you could have ran, you said I guess.
The question was
asked of you, could you have run.
You said I guess?
A
I supose I could have at that time.
I mean
he had more things to get and I stayed with him to see
what he was doing.
Q
Why didn't you run?
A
I didn't have my keys
for one thing
and I
wasn't going to leave him with my keys.
DETECTIVE MATHIAS:
May I get a question 14
in here that's off the record for the sake of the case?
THE DISTRICT JUSTICEOnly wiht no
objection.
DETECTIVE MATHIAS:
For your sake.
MR. BEYER:
I think it is for my sake.
DETECTIVE MATHIAS:
It is for your sake.
There was a brief discussion
held off the record at this time.
MR. BEYER:
This is on the record.
THE DISTRICT JUSTICE:
On the record.
DETECTIVE MATHIAS:
On the record.
BY DETECTIVE MATHIAS:
Q
Right now, the obiective of the questioning
PAGE 30
1
taking place is to determine whether or not you were in
2
fear of being harmed by Stan Caterbone and whether or
3
not you were being unlawfully restrained by him, meaning
4
you could not leave of your own free will.
Do you
5
understand?
6
A
Yes.
7
Q
The
uestion I have is, could you have
one
8
and today, as you sit here, do you feel and believe that
9
you could have left and do you feel that -- or do you
10
feel that you were being unlawfully restrained by Stan
11
Caterbone?
12
A
While we were in the building I didn't think
13
I could have left.
I don't think I could have left.
14
When I was out at the car, by that time it was all over
15
and my main concern was that he didn't leave with the
16
keys.
17
RECROSS-EXAMINATION
18
BY MR. BEYER:
19
Q
were you in fear for your life?
20
A
For my life?
21
Q
Yes.
22
A
No.
23
MR. BEYER:
Okay.
No more queestions.
24
THE DISTRICT JUSTICE:
If at the car at the
25
first trip when he was using both of his hands to put
PAGE 31
1
stuff into his vehicle, if you did flee -- how much do
2
you weigh?
3
A
Ninetey pounds.
4
THE DISTRICT JUSTICE:
So he is bigger
5
lot bigger, a lot faster, could easily overtake you?
6
A
Yes.
7
THE DISTRICT JUSTICE:
Did that thought
8
to you at all?
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
Yes.
THE DISTRICT JUSTICE: It did?
A
Yes.
I mean, I knew he was bigger than I was
and I wasn't going to -THE DISTRICT JUSTICE:
The thought did
occur
to you that if you did try to flee, if he wanted to stop
you it would be rather easy?
A
Yes, if he wanted to stop me, yes.
THE DISTRICT JUSTICE:
Is that one
things that prevented you from fleeing there? 0r is it
Just the keys?
A
Well, yes, he could easily have -THE DISTRICT JUSTICE:
I mean, is that one
of the factors?
A
Yes.
BY MR. BEYER:
Q
Were you afraid at this point?
Or you
wanted
PAGE 32
1
your keys?
2
A
At this point he had done what he was going
3
to do, I felt, and I wanted the keys so he couldn't go
4
back in.
5
Q
Through your experience knowing Stan
6
personally all this time, were you afraid for your life?
7
from him?
8
A
I was not afraid for my life.
9
MR. BEYER:
Thanks.
10
THE DISTRICT JUSTICE:
That's all.
Thank
you.
11
Do you want her to stay in the courtroom?
12
MR. BEYER:
I have no obJection to her being
l3
dismissed.
14
THE DISTRICT JUSTICE:
She can leave.
Do
15
you want to go back to work or whatever?
Thank you.
l6
17
ROBERT E. KAUFFMAN, called as a witness,
18
bein duly sworn or affirmed, was examined and testified
19
as follows:
20
THE DISTRICT JUSTICE:
Robert E. Kauffman.
21
Two F,s?
22
Q
**** * *******.
23
THE DISTRICT JUSTICE:
Two N's?
24
A
One N.
25
THE DISTRICT JUSTICE:
You may go ahead.
PAGE 33
1
DIRECT EXAMINATION
2
BY DETECTIVE MATHIAS:
3
Q
Mr. Kauffman, would you pleaes Give Your
4
address and your business, what is your vocatton?
5
A
1755 Oregon Pike, Lan*aster.
6
Q
Is that your business address?
7
A
Business address and we are in the Financial
8
services business, investment sales.
9
Q
Okay, sir.
Could you explain to those
10
present what occurred on or about the third and fourth
11
of September, 1987?
12
13
14
15
16
17
18
19
20
21
22
23
24
25
A
Well, I got a call late at night from Karen
Loss, the wife of one of our representatives, about
eleven-thirty at night.
She explained to me that she
had received a call from Stacy Waters who claimed to
have been held by Stan, that he had entered the building
against her will, that he had -MR. BEYER:
I obJect to the hearsay stuff.
If
he could get to what he knows about it.
THE DISTRICT JUSTICE:
You don't know
wheter
she did or not, but based on information relayed to you
you must have done something.
What did you do?
A
Yes.
I was advised that perhaps I should go
down to the property and look around, which I did and
when I got there, I met at least one detective and
PAGE 34
1
Stacy, Allen Loss was there and I was asked to assess
2
the damage and Stacy went around with me and told me
3
what Stanley had done while on the premises primarily
4
and I relayed that information to the detectives and
5
that was it, as far as that night was concerned.
6
BY DETECTIVE MATHIAS:
7
Q
You said damages.
What had occurred at
8
your business?
9
A
Well --10
MR. BEYER: I object to that. I think he can
11
testify to what he observed.
12
DETECTIVE MATHIAS:
Right.
13
BY DETECTIVE MATHIAS:
14
Q
What did you observe?
What did you see?
15
A
First thing that I saw was first place we
16
went was to my office and I noted there were some files
17
missing.
Second place I believe was the computer room
18
where a key was missing to our main file server and it
19
was explained to me that -20
MR. BEYER:
I obiect to that.
21
THE DISTRICT JUSTICE:
Does he understand
22
about hearsay?
23
DETECTIVE MATHIAS:
24
BY DETECTIVE MATHIAS:
25
Q
You can only testify to what you saw.
PAGE 35
1
A
Okay.
2
Q
Or what you know for a fact.
3
A
All right.
4
THE DISTRICT JUSTICE:
Not what was
5
explained to you.
6
A
Got you.
I saw that there were -- the wires
7
had been pulled out of the wall in the computer room,
8
that a key was missing to the mind frame of our computer
9
system, that our ADP, or Quotron emquipment as it is
10
called, was tampered with, that our computer system was
11
down in all the rooms and that they had been dislodged
12
probably -- well, at that point in time we felt broken -13
I was ushered into Mike Hartlett's office where I saw
14
that the desk was broken into, that some files were
15
missing, that I was then taken downstairs where a
16
17
18
19
20
21
22
22
24
25
basement door had been opened and I saw that wires had
been torn out of our phone system.
I also noted that
our burglar alarm was going off for one reason or
another.
Q
You said your phone system
A
Yes.
Q
The wires that were tampered with or pulled
were your property?
A
I'm not a phone technician.
I don't know a
whole lot about the installation.
At the time there
PAGE 36
1
were three or four -- as you lool at a phone system, you
2
see three or four large panels with hundrees of wires
3
what I knew was -- that there was several hundred of
4
those wires pulled out and that our phones were in fact
5
dead.
That's all I know.
I'm not a technician.
6
Q
Were there any items stolen from your office?
7
A
From my office, what was missing was about
8
twenty-five odd files, I would imagine, and some papers
9
from my desk.
Nothing much other than that, that I
10
could recall.
11
Q
Yhere are computers in your business?
12
A
Yes.
13
Q
Were these computers tampered with or
14
damaged?
15
A
Well there were essentially, what I recall
16
from that night with -- that our two backup tapes had
17
been taken, which contained all of our information, data
18
on thousands of clients and that from looking at the
19
main computer system and the key being missing, et
20
cetera, I could only assume that that had also been
21
tampered with and what we had feared was that we may
22
have lost our entire data base and there may have beeen
23
some irreparable damage to the main computer frame.
24
Q
As a result of these computers having been
25
tampered with, was the operation affected?
Did it
PAGE 37
1
interfere with normal operations then?
2
A
Well, the very next day, essentially we were
3
without the service whereby we quote stock and bond
4
prices for the best part of the day, which I'm sure did
5
cause us some revenue damage.
6
We also were without a phone system till
7
somewhere around noon, which can also be a problem.
But
8
I was surprised at how quickly they were able to restore
9
service in both of those cases.
The backup tapes that
10
enable us to operate our internal computer systems were
11
recovered very quickly and that enabled us to pretty
12
much run our operation without a whole lot of problem.
13
Q
Was there a monetary loss to the company or
14
to you personally as a result of these damages that you
15
were seeing?
Or these changes?
16
A
There is no question that there were.
We got
17
a -- we have a repair bill in our phone system.
18
Q
What was that? do you know?
19
A
I believe I saw a seven hundred thirteen
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PAGE 38
1
all day long.
I would suspect that bill would be
2
Fifteen hundred dollars or more.
3
We were able to recover, as I said, the backup
4
tapes but they were worth an awful lot of money to us,
5
would take several thousand man hours to restore the
6
data that is contained on our main computer system.
7
Q
Where did you recover these tapes?
8
A
I recovered them from the Manheim Township
9
Police about 3:00 a.m.
10
Q
On what date- do you know?
11
A
It would have been that same night.
12
Q
Sir, do you know a Stanley caterbone?
13
A
Yes, I do.
14
Q
Is Stanley Caterbone privileged to be in your
15
business after closing hours?
16
A
No, he's not.
17
Q
Was he privileged to be in your business on
18
the date of this offense?
19
A
No, he was not.
20
Q
Did Stan Caterbone have any ri ht to enter
21
into your office or any other office of FMG?
22
A
No, he didn't.
23
Q
Did he have any right to remove any items
24
from that business?
25
A
No, he didn't.
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Q
Did he have any right to alter or interfere
with your normal operating procedures when it came to
the computer system?
A
No, he didn't.
Q
Did he have any right to destroy any property
within your business?
A
No, he didn't.
Q
To the best of your recollection or
knowledge, did he have keys or was he capable of
entering into your business after closing hours?
A
No, he didn't have keys. The locks were
changed over two months earlier and Stan was not even
a
key.
Q
At one time did he have a key to the
business?
A
At one time he did.
Q
Why would he have a key to the business?
A
Well, at one time he was involved in the
business as an officer, director of the company and he
was also a sales re repentative for us.
Q
When would he have changed from having
privileges of those properties and the privilege of
being on your property or the property, to the status of
not being privileged to be there?
25
PAGE 40
1
Q
Of 1987?
2
A
That's correct?
3
DETECTIVE MATHIAS:
I have no further
4
questions of this witness.
5
CROSS-EXAMINATION
6
BY MR. BEYER:
7
Q
As you have been testifying on direct
8
exaxination you have been referring to a small piece of
9
paper on your lap.
May I see that, please?
10
A
I don't know.
There is nothing on it, but
11
you may see it.
12
THE DISTRICT JUSTICE:
Are they Just notes
13
to refresh your memory?
14
A
That's correct.
15
MR. BEYER:
There are several dates and
16
names on there.
17
THE DISTRICT JUSTICE:
Dates to refresh your
18
memory?
19
Q
That's correct.
20
THE DISTRICT JUSTICE:
It is quite all right
21
to have them.
He is allowed to see them also.
22
BY MR. BEYER:
23
Q
When did you first start working for
24
Financial Management Group?
25
A
August lst of 1986.
PAGE 41
1
Q
How did you come to work for Financial
2
Management Group?
3
A
It was a -- I made a decision to join
4
Financial Management Group several weeks before that.
5
I had spoken with both Stan and Mike Hartlett over a
6
period of months before that about beginning an
7
investment services firm in Lancaster.
8
Q
And when you say in Lancaster, I assume that
9
you were somewhere else at the time?
10
A
That's correct.
11
Q
You were in at Lancaster that day?
12
A
Correct.
l3
Q
And, through your past business relationships
14
with Stan and maybe Mr. Hartlett, you were brought to
15
Lancaster or you came to Lancaster to engage in
16
business with them? is that accurate?
17
A
Correct.
18
Q
And that business was kno*n as *inancial
19
Management Group?
20
A
Correct.
21
Q
And when did that incorporate?
22
A
August lst.
23
Q
Of 1986?
24
A
To the best of my knowledge.
25
Q
And upon incorporation what was your office?
PAGE 42
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A
Q
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A
He waw an executive vice resident of the
parent firm.
Q
What is the Parent firm?
A
Financial Management Group, Limited.
Q
Right. What's the corporate setup in terms
of persons and offices of the parent firm, Financial
Management Group, Limited?
A
Parent firm, I'm the president of the firm.
At that time Stan and Mike were -- equally had a
position Just below mine. Their title was executive
vice president. Mike reported to me on part of their -the business operations and Stan on another part.
Q
All right. In October of 1986, there was a
public offering made is that accurate?
A
Correct.
Q
And what was the name of that entity?
A
Financial Management Group, Limited.
Q
And in that entity you again are president?
A
Correct.
Q
And you were a shareholder of sixty thousand
shares?
A
Correct.
Q
And Mr. C*aterbone was a shareholder of forty
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43
thousand shares?
A
Correct.
Q
And to the best of your knowledge -THE DISTRICT JUSTICE: Excuse me one second.
Go ahead. Pbulic offering in October of -MR. BEYER: 1986.
BY MR. BEYER:
Q
And Mr. Caterbone at that time was executive
vice president. He had forty thousand shares and to
our knowledge, he still maintains those shares at this
time?
A
correct.
Q
Who is the secretary of Financial Mana*ement
Group, Limited?
A
I believe it was Stanley.
Q
And when did he stop being secretary of
Financial Management Group, Limited?
A
The -- he ceased being -- he ceased bein an
officer at our regular Monday morning meeting which
would have been the following Monday. I believe that
would have been July 6th.
Q
So up through July 6th, Mr. Caterbone was the
executive vice president and secretary of Financial
Management Group, Limited?
A
correct.
PAGE 44
1
Q
And in June of '87 he was also holding that
2
Position officially?
3
A
June of '87?
4
Yes.
5
A
Correct.
6
Q
Now, when was the last ti*e you had a board
7
of directors meetin* go prior to September 4th?
8
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A
Our board meets on an ever Monday morning
basis and has since its inception of August of, 1986.
Q
Did you have a shareholders' meeting prior to
September of 1987?
A
No, We didn't.
Q
Who attended the meeting in July in which Mr.
Caterbone was removed as a board member?
A
Robert Long, Allen Loss, myself, Mike
Hartlett.
Q
And it was the decision of those persons who
you Just named that Mr. caterbone would be removed as
executive vice president and as secretary is that an
accurate statement?
A
What we were advised by our legal counsel.
I'm not asking you that. I'm askin you if
that decision was made by those persons present at that
time?
A
Decision was made to remove him as an officer
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of the corporation at that time by those people.
Q
All rirht. Now, again you indicated Mr.
Caterbone still has fort thousand shares of your stock
to the best of your knowledge?
A
To the best of my kno*ledge.
Q
And, as late as Aguust of 1987, am I correct
in saying that you offered Mr. Caterbone two dollars and
fifty cents per share of that?
A
That's an oversimplification of what the
arran ement was. It was a complicated -- it was a
com licated arrangement
Q
In terms of stock per dollar price that's
accurate, correct? Regardless of the other things
around it, price per share of stock is that correct
A
That is the price that we offered on that
day.
Q
Okay. Now, the inability for you to quote
the stocks and bond prices on September 4th was as a
result of the ADP and not the computer machine, correct?
A
That's correct.
Q
And, in fact, you found out that your
computer wasn't damaged as a result of what happened
that night isn't that correct?
A
That is substantially correct.
Q
In fact, you back up your information every
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46
single day, which is on the commputer. It anything would
have been lost it would have only been for a day?
A
That's not entirely correct in that what we
were -- just so hap*ens that the one night Lisa didn't
get to the safe deposit box with our backup tapes and
our actual live copy backup tapes were both in on the
premises the night that the office was entered.
Q
Did you lose any information?
A
Not when the tapes were recovered.
Q
Okay. Now, who owns the building in which
you're located?
A
I don't know the exact name of the group.
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PAGE 47
1
thousand dollars, maaybe eight and change?
2
A
Correct.
3
MR. BEYER: I request to show this to the
4
witness, the lease for the remises.
5
THE DISTRICT JUSTICE: Go ahead.
6
BY MR. BEYER:
7
Q
I'm showing you what we will call Defendant'
8
Exhibit No. 1. Are ou able to identif that?
9
A
Sure.
10
Q
Would that appear to be the lease for the
11
premises which you are occupying right now?
12
A
Sure is
13
Q
And the same premises which were being
14
occupied on September 4th of 1987?
15
A
Sure.
16
Q
And the name of the lease as individuals is
17
who?
18
A
Hartlett, Caterbone and myself.
19
Q
Mr. Caterbone is in fact listed as an
20
individual as the lessee of this property, is that
21
accurate?
22
A
Well, I'm -- here again, I'm not a scholar
23
but I will say that it was evident that three of us
24
si ned for the corporation and there was a personal pass
25
through to our personal assets should the corporation
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48
not have been able to pay the rent. I do, as myself, I
mean I don't consider that as an individual that I have
any claim to that space. It is a corporate lease.
Q
Right. however, you will agree that you
would be individually responsible if in fact that
business failed?
A
No question about that.
Q
And as would an bod else listed as a lessee*
A
No question.
Q
And Mr. Caterbone, for the record, has signed
that?
A
Oh, yes he is responsible.
should something happen to our bussiness he is
Q
Are you familiar wth that
signature?
A
Oh, yes.
Q
Mr. Kauffman I'm showing your financials
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PAGE 49
1
it?
2
A
It was definitely my understanding he signed
3
it. That looks like his signature to me.
4
MR. BEYER: Thank you, Mr. Kauffman.
5
DETECTIVE MATHIAS: Is that all the *uestions
6
you have?
7
MR. BEYER: That's all.
8
DETECTIVE MATHIAS: May I redirect?
9
THE DISTRICT JUSTICE: Go ahead.
10
REDIRECT EXAMINATION
11
BY DETECTIVE MATHIAS:
12
Q
Did Stan Caterbone have any right to enter
13
into your office or remove any item from your office,
14
from your property?
15
A
No.
16
Q
At any time, even as a artner would he have
17
had a right to do that?
18
A
Well, the answer to that is, you know, I -- I
19
certainly don't have the ability to go in and destroy
20
things that belong to the corporation, nor do I have the
21
ability to remove things that belong to the corporation
22
from the premises and, you know, that would be -23
Q
You say able to?
24
A
I mean the right.
25
Q
Okay. You don't have the right?
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A
No.
Q
Just by good judgement? Or you don't have the
right because of some written law?
MR. BEYER: I obJect to that.
A
I think it is a different legal issue, but we
have responsibilities to the corporation as officers of
the corporation which would prevent me from doing that.
There is certainl nothin on the remises that is
outside of my personal office and my personal files that
belongs to me. Everything else belongs to the
corporation.
Q
And were any of your personal files taken?
A
Yes, they were.
DETECTIVE MATHIAS: No further questions.
RECROSS-EXAMINATION
BY MR. BEYER:
Q
You brought something up here. When I use
the word office in the next few questions, I mean our
specific office, enclosed space.
A
Yes.
Q
How long have you been in the office in which
you are now in, meaning the enclosed office of Mr.
Kauffman?
A
Since -- I don't know, maybe August l of
1986.
PAGE 51
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2
Q
A
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Q
1987?
A
Correct.
Q
Who had that office before you?
A
St
did
Q
In fact, he had the loc*s changed so no one
could go in there. However, you had them changed *ga*n
so that you could use that office* is that accurate?
A
That's incorrect. He had left ke s with
several staff eo le and the lock is the sam* as the one
Stanley has ch*nged that I use. In fact, have the same
ke .
Q
Upon your agreement that Mr. caterbone no
lon er wo*ks for ou, ou took over his office* is that
accurate?
A
It is kind -- that's an oversimplification
but it's ot a de ree of -- I mean, it is accurate. We
turned my office into a conference room to better
utilize the space and since Mr. Caterbone was not
returning, I used his office.
Q
You bring up one thing. You were first
alerted to this by Mrs. Loss?
A
we -- well, the break-in on September 3rd,
that is correct.
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Q
And isn't it true that you were also aware
that Mr. Caterbone had called a meeting for the 4th of
September to include Allen Loss, Bob Long, himself, Scot
Robertson... in fact, everybody other than you and Mr.
Hartlett and you were aware of that? isn't that right?
A
I was -- I'm going to say, yes and I was not
aware of all those -- I was aware of all those names.
Q
You were aware that the meetin was called.
You weren't asked to attend?
A
Yes. It didn't sur rise me 'cause Stan
hasn't spoken to me since the day he left.
MR. BEYER: Thank you.
THE DISTRICT JUSTICE: What was the date of
the board action wherein he was removed?
A
The date of the board action was the
following Monday, which I believe is the 6th.
THE DISTRICT JUSTICE: Of July?
A
July.
THE DISTRICT JUSTICE: That's all. Thank you.
BY MR. BEYER:
Q
Did you invite Mr. Caterbone to that meeting?
A
Mr. Caterbone had a standing invitation to
e*ery board meeting since the day we opened on every
Monday morning.
MR. BEYER: Thank you.
PAGE 53
1
2
3
concerned.
4
5
Thank you
6
7
Go back to business.
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54
Financial Management Group.
Subsequently, after a period of time, I
a roached Stan, asked him what exactly happened, why he
did what he had done. You know, I guess we had an
exchange of words to the effect I felt he was acting
very stupidly as far as handling whatever grievance he
mi *t have with Financial Management Group and
su*se*uently he left and from there I left shortly
thereafter.
I left Cousteau's myself and immediately went
out to the office of Financial Manage*ent Group to see
what had taken lace and in fact, notified the police
that he had, if they had not already been notified.
Q
I'm a little bit confused. Did Stan
Caterbone actually tell you he had done something?
A
Yes. He admitted through our conversation
that he had done this.
Q
Done what?
A
That he had gone in, taken files of which he
supposedly had in the car. He had, you know, torn out
computer lines to sabota e the office.
Q
Did he actually use the word sabotage?
A
No, but, you know, in fact, you know, a
business of that nature, to destroy their computer
network would be.
PAGE 55
1
Mr. BEYER: I object to that. That's
2
speculative.
3
BY DETECTIVE MATHIAS:
4
Q
You know Stan Caterbone?
5
A
Yes.
6
Q
Is he here now?
7
A
Yes.
8
Q
Would you please point to him?
9
A
Doing same.
10
DETECTIVE MATHIAS: Seated next to counsel.
11
BY DETECTIVE MATHIAS:
12
Q
Has any mention made concernin an air lane?
13
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A
Yes. At one time Stan had, to the best of my
knowledge, purchased an aircraft from Lancaster
Aviation. Subse*uently, to the best of my knowledge, I
understand it was repossessed due to failure of payment
and he has mentioned to Harry Lutz, who was a friend of
mine, that he was guest bartender, ou know, he was
bartending that evening and he had requested Harry to
steal the plane for him.
Q
For any specific reason? What were they
going to do with this plane?
A
He felt it was -MR. BEYER: I obJect to that. He doesn't know
what he felt. If he knows something he can state it.
56
BY DETECTIVE MATHIAS:
Q
Did Stan Caterbone actuall make a comment to
you that he was oin to take this plane?
A
I don't know that it was -- that subject was
never directly mentioned to me by Stan.
DETECTIVE MATHIAS: Fine.
MR. BEYER: Thank you.
CROSS-EXAMINATION
Q
Mr. Berger, you also have an association with
Financial Management Group?
A
That is correct.
Q
How lon have ou had that association?
A
On and off for--the last approximately twelve
months.
Q
Who was the first person to get you involved
with Financial Management Group?
A
Stan.
Q
Oka . And this conversation at Cousteau's
took place around ten-thirty in the evening?
A
No. It was later than that.
Q
Later than that?
A
Yes.
MR. BEYER: Thank ou.
THE DISTRICT JUSTICE: Are you the person that
called the police?
PAGE 57
1
A
No.
2
THE DISTRICT JUSTICE: Do ou know who did?
3
A
I believe it was the young lady that was
4
cleaning the offices that evening.
5
THE DISTRICT JUSTICE: Okay. Thank you.
6
That,s all
7
8
A
No, I don't.
9
MR. BEYER: Thank you. He may be excused.
10
I'm finished. You can leave' Thank you.
11
DETECTIVE MATHIAS: I,m the next witness. Do
12
you want me to stay here or go up there?
13
THE DISTRICT JUSTICE: If you have thousands
14
of papers that you have to constantly refer to by going
15
back and forth, then, why, your request is granted. If
16
you don't, then everybody should use the witness chair
17
in the proper court of criminal law.
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58
4th of September, 3rd and 4th of September, 1987 as a
sworn law enforcement officer of Manheim Township.
On that date at approximately -- on the 3rd of
September at approximately lO:30 p.m., our police
personnel were dispatched to MFS, located at 1755 Oregon
pike
MR. BEYER: Let the record show I think he
meant FMG.
A
Okay. Financial Management Group -concerning an unlawful entry to the building and a theft
of properties from the building. In going to that
location it was confirmed and appeared that items had
been moved and in speaking with all the witnesses who
had previously testified, subse uentl Stanle cat*rbone
was arrested.
On that evening at a proximatel three o'clock
items were seized from him on the 4th of September and
were items believed to have been the property of this
organization.
Based on all the information, Stanle
Caterbone was charged by me.
MR. BEYER: I will stipulate to the charges.
A
All of them excluding the robbery?
MR. BEYEY: Right.
DETECTIVE MATHIAS: And I believe trul that
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59
the acts were committed and that these sections and the
requirements of these sections, specifically the
computer, that's a new one. That's one that I have
never brought before.
I believe that Stanley Caterbone did interfere
with the normal operating procedures of that operation
and I do believe that he did remove from that
organization property that he was not entitled to
regardless of his position with that company.
I do believe that he entered into that
building in an unlawful way and I do believe that he
committed a crime while he was there and I believe he
unlawfully restrained a yonng lady against her will, all
said acts to have occurred in Manheim Township.
CROSS-EXAMINATION
BY MR. BEYER:
Q
Detective Mathias, in terms of the actual
custody of Mr. Caterbone, am I accurate in statin a
different police department was dispatched to pick him
up?
A
Correct.
Q
That would have been the Pequea Township or
23
24
25
Conestoga Township?
A
That is correct.
Q
And to the best of your kno*ledge, at the
PAGE 60
1
time he was apprehended, did he ask *ermission to go to
2
his house to bring certain items?
3
A
I believe he did.
4
Q
In fact, he brought loads of files to the
5
police department to indicate to you what he had
6 taken and to try to explain.
7
A
I know that a lot of items -- several items
8
were brought to the police station. I didn't persoally
9
inventory those items. I'm not sure what was brought.
10
Q
To the best of your it was his
11
incentive to bring them to you?
12
A
Yes, it was, yes.
13
MR. BEYER: Then
14
questions.
15
DETECTIIE MATHIAS:
16
prosecution.
17
MR. BEYER: Your honor I have a demurrer.
18
DETECTIVE MATHIAS: Do you want to to to their
19
case now? Or before we move on with that?
20
THE DISTRICT JUSTICE: Let's settle this one
21
first. Then we have to go to Detective Siegler's
22
hearing.
23
MR. BEYER: Your honor, I think I will try to
24
address them in the order that they are in the
25
Complaint. With respect to the burglary, it's been
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61
undisputed that Mr. Caterbone as, well as Kauffman and
Hartlett are individuals on the lease of the premises in
which he is accused of burglary in .
The lease is a nine thousand dollar a month
leasehold which Mr. Kauffman has told us each individual
could be or is individually responsible for should the
business fold. In common law, an individual who has
such a leasehold does have a rivile e to enter thos*
premises.
While there would not be an excuse for n
theft that would have occurred therein, had it occuured
a burglary would be an improper prosecution to follow
with there because of the o*vious leasehold interests
that he not only had but still does have in those
premises.
Conse*uently, we would feel that the bur lar
would need to be dismissed against Mr. Caterbone for
those reasons.
THE DISTRICT JUSTICE: We will take them one
at a time so we don't et all confused. Now bur lar
there is a demurrer sa*ing that number one, he has a
right to be there and therefore he could break down the
door, Jimmy a window or something but he didn't do an
of those things at all. He was led into the building by
this young lady and from then on he never broke a door
PAGE 63
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64
her in safely.
She also admitted
circumstances, I'm sure that
unlawful restraint under the
I don't know that's going to
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side.
PAGE 66
1
Q
Were you so employed in the first of
2
September, 1987?
3
A
Yes.
4
Q
In that capacity?
5
A
Yes.
6
Q
Did you receive any type of phone call other
7
than a normal business phone call on that date?
8
A
I thought it was, yes.
9
Q
And abaut what time did that happen?
10
A
I think between about ten ten-thirty. in
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67
the phone. The detective putting stuff into evidence
that's not no basis or foundation from a witness.
THE DISTRICT JUSTICE: Agreed.
BY DETECTIVE MATHIAS:
Q
Mrs. Kemper, do you want to te11 me again
what the caller said?
A
I answered the pho*e. No name. Party said
to me, if I were you I would not stay in that building
today and I asked why and they hung up.
Q
Okay. Do you recognize or did you recognize
the caller?
A
Yes.
Q
Who was that caller?
A
Stanley Caterbone.
Q
And do you see him in the courtroom?
A
I don't know Stanley, but I assume this
gentlemen over here is Stanley.
Q
But you recognized his voice?
A
Yes, I recognized his voice.
DETECTIVE MATHIAS: Thank you.
have nothing 21
further.
CROSS-E*AMINATION
BY MR. BEYER:
Q
How do you recognize his voice?
A
Because he called frequently.
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68
Q
And you have talked to him before?
A
He identified himself on occasions and on one
occasion it was more -- it was another comment made to
me.
Q
How long have you worked for Financial
Management Group?
A
Since July l5th.
Q
Of 1987?
A
That's correct.
Q
And, after you got this phone call you
notified someone else in the building?
A
Yes, I did, immediately.
Q
Did ou call the police?
A
I didn't, no.
Q
Do you know whether they did the same day?
16
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A
Q
A
Q
A
Honor.
I think so.
Did you evacuate the building?
No. I was scared.
Did you evacuate the building?
No.
MR. BEYER: Thank you.
DETECTIVE MATHIAS: One other question, Your
BY DETECTIVE MATHIAS:
REDIRECT EXAMINATION
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69
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70
somebody must have called?
A
I think Bob Kauffman called, but I don't know
that.
THE DISTRICT JUSTICE: You got this call and
then a little while later there is a Policeman or
detective there?
A
He came and they wanted my statement.
RECROSS EXAMINATION:
BY MR. BEYER:
Q
This was Se tember lst that the call came in?
A
September lst, yes.
Q
Mi ht the policeman not have come until
September 3rd?
A
I really can't answer. I thought it was the
same day. I can't answer that.
MR. BEYER: That's okay. I have no obJection
to this lady being excused, going about her business.
THE DISTRICT JUSTICE: Thank you. That's all.
Q
Mrs. Kemper, after you got the phone call and
you hung up the phone, what did that phone call mean to
you?
A
I was afraid
Q
Afraid of what?
A
I was afraid that there was a bomb or
something in the building. That's what entered -that's what I thought.
DETECTICE MATHIAS: Thank You.
A
That was my thought.
MR. BEYER: I have no questions.
THE DISTRICT JUSTIcE: Were the police called?
A
I think Bob. I didn't call the PoliceTHE DISTRICT JUSTICE: Did you ever see any
police around there then that day?
A
This gentlemen came over.
THE DISTRIcT JUSTIcE: Do you know that he was
a policeman?
A
Yes. He identified himself.
THE DISTRICT JUSTICE: So the did come that
day?
A
Yes.
THE DISTRICT JUSTICE: Is that right?
A
Yes.
THE DISTRICT JUSTICE: They did come. So
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PAGE 72
1
A
That's correct.
2
Q
Okay. So if there is a discrepancy the
3
statement which was taken from her woulf be most
4
accurate?
5
A
That's correct.
6
MR. BEYER: All right? Thank ou.
7
THE DISTRICT JUSTICE: That's a11.
8
MR. BEYER: Judge -- I assume you're finished?
9
DETECTIVE MATHIAS: Yes.
10
MR. BEYER: I have a demurrer.
11
(Mr. Beyer presented oral argument
12
to the court on behalf of the Defendant.)
13
THE DISTRICT JUSTICE: No rebuttal?
14
DETEcTIVE MATHIAS: No, sir.
15
THE DISTRICT JUSTICE: I don't think a crank
l6
phone call is enough, even on a prima facie basis to
17
constitute a terroristic threat charge and the demurrer
18
will be allowed and that one will not be returned to
19
court. The others will.
20
The Defendant is continued on his bail and he
21
is ordered to be bound over for the next term of court
22
on the charges previously outlined.
23
(The proceeding was concluded
24
at this time.)
25
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73
REPORTER'S CERTIFICATE
I HEREBY CERTIFY that I was present upo*nthe
hearing of the above-entitled matter and there reported
stenographically the proceedings had and the testimony
produced; and I further certify that the foregoing
is a true and correct transcript of my said
stenographic notes.
************************************************************
TI=\POSTAL COMPLAINT FILED BY US POSTAL INSPECTOR
IM= 178P01.CPR
DA= December 19, 1987
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
1
SU= SUMMARY: Complaint No: 08662 filed by Stan Caterbone to the
Office of the Inspector In Charge for an alleged illegal change
of address against Michael Hartlett, Alan Loss, and
Robert Kauffman, of FMG, Ltd.,
************************************************************
TI=\S. CATERBONE vs. SCOTT ROBERTSON
IM= 179P01.CPR
DA= January 7, 1988
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
1
SU= SUMMARY: Civil Complaint A-503-87 filed in the District Court of
Murray Horton, Manheim Township, agains Scott Robertson
of FMG, Ltd., for the $2,000 that Stan Caterbone had
loaned to Scott Roberton, on May 11, 1987 that was never
paid. Stan Caterbone has never collected this debt.
************************************************************
TI=\PA UNEMPLOYMENT COMPENSATION REFEREE' DECISION
IM= 180P01.CPR
DA= January 9, 1988
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
1
SU= SUMMARY: Referee's Decision by the Pennsylvania
Unemployment Compensation Board of Review ruling that Stan Caterbone
was "Ineligible" for benefits under Section 402 (e),
"Willful Misconduct". Again citing that Stan Caterbone
was terminated on July 1, 1987, by Robert Kauffman and
Michael Hartlett, for entering the premisis and removing
the corporate records.
************************************************************
TI=\PA UNEMPLOYMENT APPEAL RESPONSE
IM= 181P01.CPR
DA= January 8, 1988
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
3
SU= SUMMARY: Letter from Stan Caterbone to Evelyn Stehman, of
the Unemployment Compensation, Board of Review.
IM= 181P02.CPR
DI= PAGE 02
IM= 181P02.CPR
DI= PAGE 03
************************************************************
TI=\INVOICE FROM SECRETAR-ALL FOR TRANSCRIPTION
IM= 182P01.CPR
DA= January 13, 1988
Conestoga, PA
17516
IM= 186P02.CPR
DI= PAGE 02
************************************************************
TI=\BEYER'S CRIMINAL LEGAL FEES INVOICE
IM= 187P01.CPR
DA= March 21, 1988
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
4
SU= SUMMARY: Detailed invoice from Attorney Robert D. Beyer, for
legal services for the defense against the criminal charges
filed by Manheim Township Police of September 3rd and
4th of 1987. Invoice details all phone calls, meetings
and conference related herewith.
IM= 187P02.CPR
DI= PAGE 02
IM= 187P03.CPR
DI= PAGE 03
IM= 187P04.CPR
DI= PAGE 04
************************************************************
TI=\CRIMINAL CHARGES & RESTITUTION NOTICE
IM= 188P01.CPR
DA= March 21, 1988
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
1
SU= SUMMARY: Letter from Robert Beyer to Stan Caterbone informing
him that as of March 15, 1988, over 180 days after the arrest,
that all criminal charges are dismissed and that the
restitution of over $2,000 have been paid.
************************************************************
TI=\MARY JANE JACKSON/ACQUANTANCE
IM= 189P01.CPR
DA= March 22, 1988
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
1
SU= SUMMARY: During a flight from California to Philadelphia in early
March, after returning from the meeting with Attorney S. Gray,
Stan Caterbone met a woman that had associates in the
video business. Stan Caterbone had discussions
regarding the circumstances surrounding the summer of
1987. The woman sent a letter of references and had
mentioned her wishes to follow up with giving the story
to Ted Turner or 60 Minutes, as Stan Caterbone had
discussed.
************************************************************
TI=\ISC EDUCATIONAL SYSTEMS DENIAL
IM= 190P01.CPR
DA= April 27, 1988
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
1
IM=
DI=
IM=
DI=
IM=
DI=
IM=
DI=
IM=
DI=
192P05.CPR
PAGE 05
192P06.CPR
PAGE 06
192P07.CPR
PAGE 07
192P08.CPR
PAGE 08
192P09.CPR
PAGE 09
************************************************************
John S. Garofolo
Computer Scientist
National Institute of Standards and Technology
Technology Building, Room A-216
Gaithersburg, MD 20899
Phone: (301) 975-3193
Email: john@ssi.ncsl.nist.gov
Just when things are going smoothly, and we begin to feel a
little too comfortable and too confident with CD-ROM
technology, someone or something puts us in our place -- and
thankfully so. It's these challenges that facilitate our progress
toward broadening the horizons of CD-ROM technologies.
This article is intended to inform publishers and manufacturers
of the problems that can be encountered in using UNIX tarformatted files as a medium of data submission for CD-ROM
production and some of the issues confronting the next
generation of CD-ROM publishers.
Databases developed on non-DOS-based systems which have
performance requirements that exceed MS-DOS capabilities are
becoming more commonplace. Ironically, the existing CD-ROM
production infrastructure has been created and supported
primarily by DOS-based systems. Although we are making
progress in publishing data on other platforms, a large majority
of the CD-ROMs published today are still designed on DOS
machines for use on DOS machines. The current tendency to
link CD-ROM with DOS is making the implementation of CDROM technology on non-DOS systems difficult and, therefore,
slowing its widespread acceptance.
The ensuing paragraphs illustrate the need for the CD-ROM
industry to remove its blinders and address universal problems
with universal solutions. CD-ROM technology is beginning to
recruit a new breed of both users and publishers, which are
hoping that CD-ROM will adapt to them, as opposed to them
having to adapt to it. The Automated Speech Recognition
Group of the National Institute of Standards and Technology
(NIST) is one such CD-ROM publisher.
NIST: AUTOMATED SPEEC RECGNITION GROUP
The NIST Automated Speech Recognition Group
Sponsored by the Defense Advanced Research Projects Agency
Information Science and Technology Office (DARPA-ISTO), the
group designs and implements methods of performance
evaluation for spoken language systems which consist of natural
language understanding as well as speech recognition
components. Additionally, it distributes databases, or corpora,
of speech recordings as standard reference material for the
development and evaluation of these systems.
Traditionally, these speech corpora have been recorded and
stored in a digital form rather than in an analog audio format.
This allows the data to be easily loaded, stored, and manipulated
in computers and prevents signal degradation in copies. The
which reflected the design of the corpus and conformed to ISO9660. The resulting directory structure contained 4200 bottomlevel subdirectories -- one for each sentence-utterance and 3 files
per utterance for a total of 12,600 data files! This new
organization required the use of the entire path and filename to
uniquely identify a file but was "visually navigable."
To date, nearly 300 "TIMIT Prototype" discs have been
distributed to universities and speech research laboratories
worldwide. The discs were well received by the speech research
community and have been read on PC's, Apple MacIntoshes,
various UNIX systems, Next machines and DEC MicroVaxes.
The "experiment" had proved to be successful.
To date, NIST has produced four releases of speech corpora on
eight discs. Recently, NIST completed production of its most
ambitious speech disc so far. The new disc is a complete
revision of the TIMIT Prototype disc and contains the speech for
the complete 630-speaker corpus as well as all-new time aligned
word-boundary transcriptions. The new TIMIT CD-ROM
contains 25,200 data files (4 files per utterance) as well as more
extensive documentation and software utilities.
After the production of the TIMIT prototype disc, NIST
recognized the need to distribute speech corpora in a consistent
format. Unfortunately, no standard file format existed for
storing and exchanging speech signals. Compounding this
problem, almost every speech research laboratory around the
world used different hardware and software configurations for
speech signal processing and analysis.
A UNIX-Based CD-ROM Preparation Workstation
In order to implement a full scale CD-ROM production effort,
the Automated Speech Recognition Group built a UNIX-based
CD-ROM publishing workstation, which also doubles as a
general-purpose speech research system. CD-ROM images are
prepared on a Sun Microsystems server system with 32
megabytes of main memory, 3 gigabytes of high-speed magnetic
disc storage, a 9-track tape drive, an 8mm tape drive, and of
course a CD-ROM drive. The workstation contains two 1.2
gigabyte magnetic disc drives on which entire CD-ROM images
can be assembled and simulated.
Each CD-ROM is now organized entirely in the UNIX
environment. Many of the standard UNIX utilities and
capabilities have proven ideal tools for CD-ROM preparation.
Tar files are now submitted for CD-ROM replication on one
8mm tape, instead of 5 or 6 half-inch reel-to-reel tapes. UNIXbased CD-ROM premastering software is planned to be added
in the near future to help alleviate some of the complications
NIST has experienced in submitting data for replication. By
performing ISO-9660 formatting in house, a master stamper
image can be submitted to the replication facility -- thus
circumventing the problems inherent in downloading tarformatted files.
NIST has developed strategies to maximize the portability of its
CD-ROMs by organizing speech data into a consistent format
variants of UNIX.
Because the tar format is portable and preserves directory
hierarchy, and because a tar file can be written to a standard
ANSI-labelled tape or any other storage medium, NIST
concluded that tar-formatted ANSI tapes would be the ideal
vehicle for providing a CD-ROM-ready file image to a
replication plant.
Unfortunately, NIST has found that most replication plants
either refuse to accept tar-formatted files as input to their
premastering systems or they charge exorbitant "data conversion"
fees to load the files. To say the least, the acceptance of tar as
an input medium for CD-ROM production has been less than
universal by the CD-ROM replication industry. The few
replication facilities that have ventured into the "tar pit" with
NIST have encountered numerous technical delays and costoverruns. In theory, the tar-tape to CD-ROM process should be
simple. But in reality, it has rarely been straightforward to
implement.
IM=
DI=
IM=
DI=
IM=
DI=
IM=
DI=
IM=
DI=
IM=
DI=
IM=
DI=
202P02.CPR
PAGE 2
202P03.CPR
PAGE 3
202P04.CPR
PAGE 4
202P05.CPR
PAGE 5
202P06.CPR
PAGE 6
202P07.CPR
PAGE 7
202P08.CPR
PAGE 9
************************************************************
TO:
Department of Defense
Defense Mapping Agency
ATTN:
Subject:
DMA700-90-0011 Contract
Regretfully,
Stanley J. Caterbone
Director, Advanced Media Group, Ltd.,
ENCLOSURES
cc:Captain Wright, Defense Mapping Agency
Stanley O. Smith, Brigadier General, USAF, Chief
of Staff
Dave Gribben, Assistant Secretary of Defense,
Legislative Affairs
Congressman Robert Walker, U.S. Congress
James Christian, Loretto State Prison
Sir Derek Jones, Chairman, Farranti International,
PLC.,
Tony Bongiovi, Power Station Studios
Marcia Silen, Flatbush Films
Ted Gamillion, Gamillion Studios
Diane Sawyer, ABC News, PRIME TIME
Betty Scorpa, CBS NEWS, 60 MINUTES
Murray Horton, District Justice
Rufus Fulton, Fulton Bank
Detective Bodan, Pennsylvania State Attorney General's
Office
Howard Eissler, Pennsylvania Securities and
Exchange Commission
Gibson Armstrong, Pennsylvania State Senator
Detective Larry Mathias, Manhiem Township Police
Department
Chuck Smith, Lancaster Aviation, Inc.
Mike Wolfe, Commonwealth National Bank
Lancaster District Attorney, Totaro
Jack Buckwalter, President, Lancaster News Papers, Inc.
Robert Beyer, Attorney
Joseph Roda, Attorney
************************************************************
TI=\LUCASFILM, Ltd., LETTER
IM= 334.CPR
DA= January 24, 1991
AT= AUDIO TRACKS: /ALL
PA= PAGES: 1
SU= SUMMARY: Letter from Jeffrey C. Ulin, Associate Director of Legal
and Business Affairs concering information forwarded to George Lucas.
************************************************************
TI=\FMG, Ltd., AND SUBSIDIARIES ARTICLES OF INCORPORATION
IM= 301P01.CPR
DA= June 12, 1986
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
9
SU= SUMMARY: Copies of the Seven (7) corporations that were
incorporated with the Commonwealth of Pennsylvania Department
of State - Corporation Bureau by Stanley J. Caterbone.
Not shown is the Articles of Incorporation for Pro
Financial Group, Ltd., which was incorporated in April of
1986, by Stanley J. Caterbone who owned 100% of the
outstanding stock.
IM= 301P02.CPR
DI= PAGE 02
IM= 301P03.CPR
DI= PAGE 03
IM= 301P04.CPR
DI= PAGE 04
IM= 301P05.CPR
DI= PAGE 05
IM= 301P06.CPR
DI= PAGE 06
IM= 301P07.CPR
DI= PAGE 07
IM= 301P08.CPR
DI= PAGE 08
IM= 301P09.CPR
DI= PAGE 09
************************************************************
TI=\FMG, Ltd., & FMG ADVISROY CONTRACTS
IM= 302P01.CPR
DA= October 17, 1986
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
7
SU= SUMMARY: The contracts for all licensed representatives and all
affiliated persons of FMG Advisory, and FMG, Ltd., signed by
Stanley J. Catebone. Only the license agreement with FMG
Advisory, Inc., was officialy executed, which was
binded by Stanley J. Caterbone, President and Secretary
of FMG, Advisory. The license agreement with Financial
Management Group, Ltd., clearly states several key
elements, which specifically contradict legal actions
taken by Kauffman and Hartlett. Firstly, the contract
specifically states that the licensee and licensee have
only that such relationship, and in no way shall ever be
construed as an employer employee relationship. Secondly, the
contract may only be terminated by formal written notice,
submitted with a 30 day notice to the last official address of
the licensee, or to Financial Management Group, Ltd., by
registered or certified U.S. Mail.
IM= 302P02.CPR
DI= PAGE 02
IM= 302P03.CPR
DI= PAGE 03
IM= 302P04.CPR
DI= PAGE 04
IM= 302P05.CPR
DI= PAGE 05
IM= 302P06.CPR
DI= PAGE 06
IM= 302P07.CPR
DI= PAGE 07
************************************************************
TI=\EDEN PARK ASSOCIATES LEASE AGREEMENT
IM= 303P01.CPR
DA= August 14, 1986
AT= CORRESPONDING AUDIO TRACKS: 01/02/03/04/05/06/07/08
PA= PAGES:
4
SU= SUMMARY: Copies of the legally executed lease agreement
between the Eden Park Associates II, (Lessor), and Financial
Management Group, Ltd., (A Pennsylvania Business
Corporation), and Michael M. Hartlett, (Individual); and
Stanley J. Caterbone, (Individual);, and Robert K.
Kauffman, (Individual). The lease agreement was for
a term of Five (5) years, and Kauffman, Hartlett, and
Caterbone, had signed binding personal guaruntees for
over $500,000, until August 14, 1991, the expiration date
of the lease. Any modification or amendment required a
formal written notice, of which would have been required to be
executed by the Secretary of Financial Management Group, Ltd.,,
or Stanley J. Caterbone.
IM=
DI=
IM=
DI=
IM=
DI=
303P02.CPR
PAGE 02
303P03.CPR
PAGE 03
303P04.CPR
PAGE 04
************************************************************
that
when I come across opportunities that may be useful and profitable to you,
I don't have to spend weeks or months trying to communicate with you to
determine the merits of such opportunities.
FMG Ltd.
SJC:lmk
cc: S. Robertson
B. Long
A. Dannatt
***********************************************************
May.
Scope of Business
II.
III.
IV.
Structure of Syndication
Costs of Syndication - Bennett Williams Financial Center
V.
I.
in
is
SCOPE OF BUSINESS
FUNCTION OF BENNETT
b).
c).
maintain a
d).
income and
II.
FMG, Ltd. will be responsible for the following services and factors:
a). The Syndicator will be responsible for all legal
and accounting services needed to register the partnership with the
appropiate regulatory authorities in order to solicit
investors.
b). Prospectus - The Syndicator will be responsible for the
development and production of the prospectus to be used to solicit
investors.
c). Marketing - The Syndicator will be responsible for the
marketing and solicitation of investors in order to raise the
necessary capital to
finance the project.
d).
This
most
Financial Planning
Investment and Portfolio Management
Accounting and Tax Preparation
Real Estate Services
Legal Services
Insurance Services
Investment and Mortgage Banking
<SHERR>: This is the story of how this deadly weapon designed for the
U.S. military made its way from this country to Iraq and how Americna
soldiers may now face the devastation from thousands of cluster bombs
if a ground war breakes out in the Persion Gulf. Federal officials
believe Saddam Hussein got his aresenal through a lethal combination-bureaucratic foul-ups in the U.S. government and simple greed.
Her's how th cluster bomnbs work. An artillery, an airplane or a
rocket-launchersend the bombs toward their targest. Each bomb carries
hundredsof smaller bomblets, something like hand grenades. Cluster bombs
be used against groundtroops or tanks and can even scatter mines to lie
dormant for days. The shrapnel can rip through the bodies of anyone or
anything in its way, causing massive casualties among destruction in
these buildings in Lebanon after a cluster bomb attack.
How did Iraq obtain the cluster bombs and the technology to make
their own? It was incredibly simple. Investigators believe it began
with International Signal & Control, a government contractor with
5,000 employess based in Pennsylvanial which designed key components of
clusters and built them throug a subsidiary in California. 20/20 has
learned federal investigators believe ISC provided the technology -- that
is the plans for the cluster bomb to this man, Carlos Cardoen, a Chilean
arms dealer. Authorities think he used the plans to build the cluster
bombs in Chile. Then he shipped them to Iraq.
What's wrong with all this? If the cluster bomb technology actually
left the county, that is illegal without U.S. government permission, which
investigators say ISC never got. It is also illegal for a foreigner like
Cardoen to take suh plnas out of the United States without a license,
which sources tell us he never obtained.
The man who opened the door to Iraq for Cardoens operation was this
man, Nasser Beydoun. Hee is a Lebanese-born middle man for Cardoen
who is based in the United States. Beydoun traveled frequently to Baghdad
and arranged for the sale of cluster bombs and other military hardware to
Saddam Hussein's army. In this first television interview, he told us
about the business of dealing in deadly weapons.
<NASSER BEYDOUN, Arms Dealer>: I can sell you a knive to peel an apple.
If you cut somebody's throat wiht it, it's your business. Weapons do
not kill. Who is behind it kill.
<SHERR>: With slick promotional videos, Cardoen marketed his arms
throughout the world, but Arab countries were most favored.
<VIDEO ANNOUNCER>: Each one of the bomblets of the cluster bomb is
multi-purpose and has an incediary, anti-personnel and anti-armor
effect.
<SHERR>: This letter from Cardoen authorized Beydoun to sell cluster bombs
to Saddam Hussein during his war with Iran. It says Cardoen's company
is "willing to take its share in helping Iraq in this time of need. We
can provide you with our cluster bombs at the lowest possible price."
According to these contacts, the sale of cluster bombs to Iraq was an extremely
lucrative business. February 24., 1984-- 3,000 cluster boms sent to
Saddam Hussein's army, worth $21 million. A few months later, another
3,000 bombs, another $21 million. The supplies of cluster bombs
eventually totalled more than $400 million. In fact, Beydoun is suing
any
<SHERR>: No, Hugh, no indictments yet. Carlos Cardoen has not been
indicted, even though federal agents raided his headquarters office in
Miami and U.S. Customs agents took a number of documents, but-- no
indictments yet, but there are investigations that are goin on.
<DOWNS>: If these things are dropped from airplaines and we have air
supremecy, as has now been said by our leader, is there much to worry
about for our troops?
<SHERR>: We're told yes, because you don't need an airplane to drop a
cluster bomb. They can also be used on rocket-launchers and on unguided
missiles, bothe of which Iraq has. And incidentally, we talked about
that bomb factory. Even if it was badly damaged -- the cluster bomb
factory that he already has -- we're told that in three to six months
it can be operationa again and anyway, he likely has a big stockpile.
<DOWNS>: We, of course, have these weapons also, but I don't understand,
that's called by something different.
<SHERR>: Yeah. If you're listening to a Pentoagon briefing, don't
listen for the term "cluster bombs". They're calling them
"area denial weapons"
<DOWNS>:
<WALTERS>: Well, next, preparing American pilots for air combat aver
Iraq. Stone Phillips went to a Nevada Air Force Base-- dress reherrsals for
actual battle conditions. [COMMERCIAL]
************************************************************
TI=\CD-AUDIO MASTER CUE SHEET AND SPECIFICATIONS
IM= SMPT1.CPR
DA= February 12, 1991
PA= PAGES: 02
SU= SCRIPT MASTER TAPE CUE SHEET
DATE:
TITLE:
10/12/91
1987 RECORDED AUDIO CONVERSATIONS "SELECTIVE CONVERSATIONS"
CD-ROM
TRACK
TITLE
DATE
PERSONS
BEGIN
END
TRACK
TIME
___________________________________________________________________________________
___________________________________________
1
PA SEC I
09/29/87
Howard Eissler
TRACK 1
11 min
ISC ALLEGATIONS
Bill Johnson
11-51-40
Robert Byers
Stan Caterbone
Sandra Gray
6
00
Dave Drubner
TRACK 4
Avalon Police
23 min
1230
TRACK
11-51-58
20-14-00
1236
1467
20-14-08
25-11-06
07/07/87
Dave Drubner
2.5 min
Stan Caterbone
25-11-10
08/27/87
Gamillion
07/21/87
TRACK 5
4 min
Studios, Inc.
0792
0-16-01
0793
Stan Caterbone
3
0000
1470
27-43-26
1582
1960
Stan Caterbone
27-43-32
52-56-03
Ted Gamillion
0435B
0671B
Stan Caterbone
52-26-15
56-57-
1967
End A
Marcia Silen
7
Family
07/26/87*
Stan Caterbone
Steve Caterbone
Phil Caterbone
Mike Caterbone
Tom Caterbone
Robertson
07/12/87
Scott Robertson
Stan Caterbone
9
10
Power
07/16/87
TRACK 6
5 min
Station Studios
Bob Walters
Stan Caterbone
0000B
0434B
0672B
0940B
56-57-10
61-01-
10
TRACK 7
PA SEC II
10/28/87
Howard Eissler
3 min
Stan Caterbone
11
1262B
PA ATTORNEY
TRACK 8
GENERAL OFFICE
12
13
ABC 20/20
02/01/91
Barbara Walters
11 min
"MADE IN THE USA"
Lynn Sherr
ISC FEATURE STORE
Hugh Downs
0942B
61-53-10
10/28/87
Detective Bodan
4 min
Stan Caterbone
1041B
64-48-10
1093B
64-50-10
68-18-
10
Tom Brokow
38 MIN
IM= SMPT2.CPR
DI= PAGE 2
************************************************************
TI=\STAN J. CATERBONE INVESTMENT PORTFOLIO
IM=PORT2.CPR
DA= February 12, 1990
PA= PAGES: 02
SU=
INVESTMENT PORTFOLIO
STAN J. CATERBONE
(AS OF JULY 1,
1987)
ASSET
OWNERSHIP
DATE
LOST
ESTIMATED
PRESENT
VALUE
VALUE '91
2323 New Danville Pk.
Michael and Stan J.
$140,000
$212,630.00
Lancaster, PA 17547
Caterbone
433 West Marion Street
$ 85,052
Lancaster, PA 17603
Stanley J. Caterbone
07/01/87
07/01/87
$ 56,000
50,000 Shares of
$759,394
Financial Management
Stanley J. Caterbone
07/01/87
$500,000
Mortgage Banking
Activities
Stanley J. Caterbone
07/01/87
N/A
"MUTANT MANIA"
Stanley J. Caterbone
07/01/87
N/A
$4,000,000
$6,751,000
Digital Movie
Navaho "CHIEFTEN"
$173,123
Airplane
Stanley J. Caterbone
07/01/87
$121,000
09/03/87
$350,000
______________________
___________
TOTALS
$5,317,000
_____________________
__________
$9,381,338
___________
$490,000
IM= PORT.CPR
DI= PAGE 02
************************************************************
TI=\STAN CATERBONE NOTES OF NEGOTIATIONS WITH AMERICAN HELIX & HIGH, INC.
DA= April, 1990 to February 1991
SU= Legend: David D. Dering - President, Board of Directors, American Helix
Allon Lefever
Jim Tritch
<April, 1990:
Dave
This was
Dave Dering "Stan, how did you get in here last night?".
Stan "Dave, what are you talking about?, I won't go near that building,
the last time I went back into my own building after being ilegally
locked out, I ened up in jail".
Dave Dering " How did you get in here and steal your fax?".
Stan "Dave, why would I want to steal the fax that I wrote?"
Dave Dering "You have caused a big problem. You put me in a difficult
position -- I don't know if I can rectify things with the 'High's' and
espicially Allon Lefever. I always went to bat for you -- how do I
trust you?".
A meeting was set up for 6:00pm later that day.
**********************
<January 22, 1991: Stan Caterbone with Dave Dering>
Dave gave three (3) reasons for the "LOCKOUT", although never willing
to engage in any real conversations relating to those issues:
1. The computer system went down, causing a problem in the security
system.
2. Jim Boyer did not reinstall my access identification number for
the security system.
3. Jim Boyer was to talk to you on Friday, the day before the
lockout, concerning eliminating your access to the facility.
Dave said "Jim Boyer said that he can take over the CD-ROM business
-- no problem".
Dave talked about trust and who to trust. Dave reluctantly agreed to
continue our relationship, however only on an arms legnth basis. I
was no longer allowed in the building except during normal business
hours. I was no longer to have a private office.
Dave Dering never addressed the issues or the circumstances that
preceeded the "LOCKOUT", and never addressed the reasons as to why
there was any reason to modify the agreement concerning my business
American Helix that was established back in June of 1990. There were
no disputes, activities, or conversations that gave any indication
that American Helix, Dave Dering, or Jim Boyer intended to change or
modify our relationship.
**********************
<January 24, 1991: Stan Caterbone with Allon Lefever>
Stan Caterbone called a meeting Allon Lefever to discuss the following:
1. The R.R. Donnelly merger and acquisition of American Helix.
2. The "LOCKOUT".
Allon asked questions regarding my contact with R.R. Donnelly and Barry
Glick. I quickly made it clear that Barry Glick contacted me in
December after seeing my advertisement in the CD-ROM Enduser magazine,
pulblished by Linda Helgerson. Barry was elated to see someone in the
local area that was involved with CD-ROM technologies and asked to
visit with me. Allon asked many questions about Donnelly and Barry
Glick. I made it clear that during our visit, and from the discussions
regarding the strategic plan of Donnelly, I suggested that there may be
an opportunity for a merger or aquisition with American Helix. I also
discussed the capabilities for the facility to be a dedicated CD-ROM
manufacturing facility. I notified Allon that Barry was awaiting a
call from the next day concerning the appropriate contact to discuss
the subject of an acquisition. Allon assured me that the High's would
not contact Donnelly directly and would await a call from Barry Glick.
Regarding the "LOCKOUT" I gave the three reasons that Dave Dering had
provided during our meeting a few days before. I told Allon that after
"I had built a strong foundation for the CD-ROM business -- everybody
suddenly wants it back, six months ago, nobody wanted anything to do
with it, not to mention the capital that I had invested in it".
Allon Lefever was only concerned with why I had sent the Fax. "Why did
you send the Fax? I just don't understand why you sent the Fax". Allon
was not concerned with or wanted to discuss the issue of why I was
"LOCKED OUT".
Allon asked me the problems surrounding American Helix and what solutions
I thought could help restore the company to stability. I discussed the
lack of systems, the lack of a strong business foundation, and most
importantly the lack of management. He asked me about Dave Dering and
I responded "Dave Dering is an engineer, not a manager, he has no
real management skills".
Allon then asked me how to approach the meeting with Donnelly.
IM=
DI=
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Stan Caterbone was able to cuase a fierce competition for the $2.5
million Department of Defense contract (DMA007-900-0011). Ironically
the two other competitors were the very same companies that had
been responsible for the development of CD-ROM, SONY (DADC) and
Phillips DuPont (PDO). Incidently, the procurment is currently under
investigation for possible misconduct after several greivenced filed
by Stan Caterbone.
AMG1.CPR
PAGE 2
AMG2.CPR
PAGE 3
AMG3.CPR
PAGE 4
AMG4.CPR
PAGE 5
AMG5.CPR
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AMG6.CPR
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PAGE 11
CAPABILITIES:
AMERICAN HELIX TECHNOLOGY CORPORATION
BACKGROUND
AmericanHelix was funded by High Industries, Inc., of
INFORMATION TECHNOLOGIES
Under the direction and ownership of Stan J. Caterbone, The
Advanced Media Group, LTD., services the information technology
market, and features end to end CD-ROM (WORM, DVI, CDTV,
LASERDISC) production capabilities. The Advanced Media Group,
LTD., firmly believes that the ability to provide efficient coordination
and management to optical publishing projects is critical to it's success.
Because of the extremely complex process of optical publishing, and the
need for many disciplines during its production, the project manager
must not only develop and produce an effective application, but he must
also bring the project in within the prescribed budget.
By providing clients with the capabilities for end to end
production, along with assuming the responsibility for the entire process,
AmericanHelix delivers a cohesive, synchronized, and organized
approach to developing information technology applications. The
Advanced Media Group, LTD., has made a firm commitment to its
development of various information technologies, without the
dependency for any one type of medium.
The Advanced Media Group, LTD., provides Application Design
Services; Data Conversions, Scanning and Keying; Data Preparation and
Indexing; Software Configuration and Development; Application
Simulation; Prototype and Storyboard Applications; Premastering,
Mastering, and Replication; Exhibit Technologies; and Point of Sale
Kiosks (POS).
Of course the Advanced Media Group, LTD., does not ignore
the market for individual services. The menu of services can be selected
to compliment the available efforts of any organization. Clients can
select only services that it elects not to perform in-house. Understanding
that there are several organizations with qualified and extremely
innovative technology capabilities,
the Advanced Media Group, LTD.,
would like to compliment those organizations
The Advanced Media Group has recently completed one of the
most aggressive CD-ROM projects for the National Institute of
Standards and Technologies (NIST), of Bethesda, Maryland, a
government sanctioned technologies incubator for U.S. technologies at
large. The project included over 25,000 UNIX Tar files and a CD-ROM
of over 675 megabytes. Stan Caterbone and John Garafolo, Computer
Scientist for NIST, have written an article containing valuable
information that is useful when publishing UNIX applications on CDROM. The article will appear in the January issue of DISC Magazine,
published by Helgerson Associates.
CLIENT LIST
National Institute of
Standards & Technology (NIST)
Groller Electronic Publishing
E. Giovanetti
Dialcom
Vaghi Periodicles
Clahritas
Advanced Systems Development
Compaq Computers
Applied Optical Media Corp.
Commodore Business Machines
DRI/McGraw Hill
Meridian Data
Pennsylvania Blue Shield
INFO ONE International
University of Montana
National Technical Info Svc
Rochester Institute of Technology
NEC
Amp, Incorporated
Parkway School District
Hitachi Systems Division
Department of Commerce
Mathew Bender Co., Inc.
Nortek Computers, Ltd.,
University Microfilm International
Bell Atlantic
Aspen Systems Corporation
Microsoft CorporationRon Giordano
Arther AndersonAtlantic Beach Realty
PC Solutions Plus(609) 368-7023
Capitol RecordsMovie Real Estate
Digital Audio Disc Corporation (SONY)
Ingram Customer Systems
University of Hawaii at Manoa
National Bibliographic Service
International Business Machines (IBM)
Veterans Administration
************************************************************
TI=\PROFESSIONAL ASSOCIATES AND CLIENTS OF STAN CATERBONE
RELATING TO FINANCIAL MANAGEMENT GROUP, Ltd.,
Dave Cook
Turkey Hill Minit Markets
Centerville Road
Lancaster, PA 17603
(717) 299-8908
Movie, Bennet Williams
John Berg Associates
Philadelphia, PA
(215) 636-1900
Financing
Barry Newhardt
Progress ...
Lancaster, PA
Financing, Real Estate
Andy Glosser
Lanecor Associates
Lancaster, PA
Financing, Equity
Marylin Berger
Daniel Berger
Berger Real Estate
E. New Street
Lancaster, PA
Financing, Real Estate
Jim Bly
Source Capital
6725 Curran Street
McLean, VA
22102
Financing, Movie, Airplane
Rental $250/HR
Norris Boyd
Boyd Wilson
Olde Hickory
Lancaster, PA 17601
(717) 569-0484
Financing, Movie
Fidelity Mortgage
Michael Long
Philadelphia, PA
(215) 424-3100
Financing
Bill Tell
PDQ Industies, Inc.,
Brownstown, PA
(717) 656-4281
(717) 656-6892 FAX
0118163030550 (Japan Fax) R-DAT
Financing, Movie,
Vic
Romar Aviation
Lancaster Airport
Lancaster, PA
17601
(717) 569-8296
Pilot, "involved in
reposesstion"
Tony Pascatti
Underwriters Advisory
3605 N. Progress Ave.
Harrisburg, PA 17110-9697
(717) 652-6686
Movie, Financing, FMG
Insurance contracts
Al Dannat
Institutional Investors
777 North Eldridge
Parkway, Suite 730
Houston, TX 77079
(713) 497-8010
Morgage Banker
Dave Schaad
Bennet Williams Realty
York, PA
(717)
Real Estate Partnerships,
Birtcher Real Estate
Bob Spicer
Philadelphia, PA
(215) 503-8537
Financing, Equity
Madelin Wooten
John Keeble, President
Financial Service Corp.
Atlanta, GA
Bill O"Hara
554 Berkley Road
Stone Harbor, NJ
(609) 884-7199
Landlord,
Jack Mann
Shelter Haven Rlty
Stone Harbor, NJ
Real Estate, Finanancing
Reg Pattey
Burle Industries
New Holland Ave.
Lancaster, PA
Finanancing for Burle
Ned Grove
Lancaster, PA
Finanancing
Jerry Miller
GEM Development
Lancaster, PA
Finanancing, Equity
Tom Kyle
High Associates
High Industries
Lancaster, PA
17601
Financing, Partnerships,
Movie
James Christian
United Chem Con
Lancaster, PA
Financing, Movie,
Jules Goldfarb
G/N Associates
2316 Dairy Road
Lancaster
PA
17601
David M. McClatchy
MaClatchy
630 West Chestnut Street
Lancaster PA
17601
Ed Vinson
10749 Falls Road
Suite 202
Lutherville MD
21093
Len Shendell
Columbia Asset Management
Twining Office Center
715 Twining Road
Dresher PA
19025
Jeff Springer
Diversified Investment Asso.
16 South Calvert Street
Suite 400
Baltimore MD
21202
Sal Belluardo
John G Berg Asso.
1 Logan Square
Suite 1105
Philadelphia PA
19107
Jeff King
National Properties Inc.
150 East Swedesford Road
Wayne PA
19087
Bob Fields
Manor Group
1377-C Spencer Avenue
Lancaster PA
17603
Mr.Rosenblatt
Max Gomburg
Gomburg Associates
995 Greentree Road
Pittsburgh PA
15220
Joel & Mimi Baron
Baron
601 East Chestnut Street
Lancaster PA
17602
RELATING TO THE ACTIVITIES OF THE DIGITAL FILM ("MUTANT MANIA")
Gene Clair
Clair Bros Studios
Lititz, PA
Sound Production
Barbara Peters
Arlene Davidson
Marcia Silen
Flatbush Films
4334 Stern Ave.
Sherman Oaks, CA 91423
(818) 995-3417
Movie Producers
Rhema
Video Service
Philadelphia, PA
(215) 738-3751
Movie Production
Tony Bongiovi
Bob Walters
Ellen Lipman
Power Station Studios
New York, NY
Movie Partners
Ted Gammilion
Mary Gamillion
Gamillion Studios
1137 N. McCadden Pl.
Hollywood, CA
90038
Mike Wolfe
Commonwealth Bank
(717) 780-3092
Loan Officer, Airplane
Mr. Cohouet
Mellon Bank
(412) 234-5000
Discussed Law Suit
regarding reposssession
ATTORNEYS AT LAW
Joseph Roda, PC
301 Cipher Building
36 E. King Street
Lancaster, PA
17602
(717) 397-3791
Robert D. Beyer
Arnold, Beyer, Homsher
110 E. King Street
Lancaster, PA
17602
(717) 394-7204
Lewis J. Schweller
Valore, McAllister,
Westmorland, Gould,
Vesper & Schwartz
Mainland Professional
535 Tilton Road
Northfield, NJ
(609) 645-1111
08255
93101
17604
Joel Goldhammer
Sidel, Gonda, Goldhammer & Abbot
Philadelphia, PA
(215) 568-8383
Kerry Steigerwalt, ESQ.
5450 Kirkwood Dr. K-3
San Diego, CA 94521
Sandy Gray
c/o Kerry Steigerwalt
San Diego, CA
AUTHORITIES
Intercon Special Svc.
Frank Garrity
60 E. 42nd Street
Suite 1045
New York, NY
(212) 370-4430
Gib Armstrong
(717) 786-862
Cris Mele
Attorney General Office
(717) 782-4482
Corporate Acconting Office
P.O. Box Drawer 671
Dunkirk, NY
14048
11/25/87 Return
972386104
85 B48 10
Lancaster Chamber of Commerce
Dave Wouols
Lancaster, PA
State Police
Lincoln Hwy East
Lancaster, PA
Lancaster Police
N. Queen Street
Lancaster, PA
Governer Robert Casey
Harisburg, PA
Federal Bureau of
Investition, (FBI)
Fred Martin
(717) 232-8686
Pennsylvania Attorney General's Office
Detective Boden
Admitted Partners had a
Power of Attorney, talked
to him in July
PERSONAL REFERENCES (Witness to Activities of '87)
Linda Davis Vega
Orlando, Fl
Tuesday Barnette
431 S. Plum Street
Mount Joy, PA
(717) 653-4570
Rob Clark
West Palm Beach, FL
Maggy Brodesser
Cape May, NJ
(609) 886-6035
(609) 886-2782
Mike Orstein
York College
York, PA
(717) 560-0627
Tammy
Cape May, NJ
(609) 884-3425
Rudolph Valentino
(717) 299-1473
Ric Obrect
Calico Cat
Stone Harbor, NJ
(717) 394-8320
Bill Johnson
Lancaster, PA
(717) 285-3685
Michelle Hodge
Middletown, DE
(302) 378-4762
(609) 465-7924
CLIENTS OF STAN CATERBONE FOR FINANCIAL ADVISORY SERVICES
Dr. William Umiker
1350 Hillcrest Road
Lancaster, PA
17603
(717) 394-9936
Millard Johnson
Duff Ave.
Lancaster, PA
717) 285-3685
Richard Elson
East Petersburg, PA
Dickie Coho
Lancaster, PA
RELATING TO THE ACTIVITIES OF DIGITAL TECHNOLOGIES
David D. Dering
James Boyer
American Helix
1857 Colonial Village Lane
Lancaster, PA 17601
(717) 392-7840
Allon Lefever
Jim Tritcsh
High Industries, Inc.
William Penn Way
Lancaster, PA
17601
Linda Helgerson
Helgerson Associates
Publishers
510 N. Washington St.
Falls Church, VA 22046
(703) 237-0682
Steve Swan
Data Development
42 Flagler Ave
Stuart, FL 34995
(407) 288-7226
Gil Bowen
Data Development
19th & L Street, N.W.
Washington, DC
(202) 785-8822
Slavek R. Rotkiewicz
American Bankers Bond
New York, NY 10004
(212) 943-4202
Tom Vreeland
Amy Kovarick
Ann Richards
NETWORK TECHNOLOGIES
Springfield, VA
(703) 866-9000
Marshall Mathews
Terry Harple
Ferranti International
Lancaster, PA
(717) 285-7151
Charles Bauer, Sr.
Skip Strovel
B&B Information & Image
8325 Marlboro Pike
Upper Marlboro, MD
(301) 735-3690
Lucy Griffen
Joan Gervino
American Bankers
Association
1120 Conneticut Ave. N.W
Washington, DC 20036
(202) 663-5491
Dr. William Sailer
Trinity Church
205 N. Railroad St.
Myerstown, PA 17607
(717) 866-5775
Mike Kawahara
Commodore Computers
1200 Wilson Drive
West Chester, PA 19380
(215) 431-9452
Mike Grubbs
Tandy Electronics
Houston, TX 76102
(817) 390-3693
Lloyd E. Lewis
Library of Congress
Washington, DC
20541
(202) 707-1308
Dave Benfer
EXXON Production Research
3120 Buffalo Speedway
Houston, TX
77252-2189
Ed Bauergard
Amp, Inc.
2909 Fulling Mill Rd
Middletown, PA
(717) 986-7455
Harry Needleman
Labott Anderson
NASA Library
Washington, DC
Thomas Thiel
Scott
Kathey McKosky
Advanced Systems Development
Arlington, VA
Ken Rudolph
American Helix
Lancaster, PA
Kenneth Clark
Bell Atlantic
Democracy Blvd
Bethesda, MD 20817
(301) 493-3541
Carmen J. Martin
Ford New Holland
500 Diller Ave
New Holland, PA
(717) 355-1638
17557
Wayne Landis
PC Solutions
159 Windy Hill Road
Duncannon, PA 17020
(717) 834-9227
Jan L. Kloiber
Arthur Anderson
69 West Washington St.
Chicago, IL 60602
(312) 507-2548
Bruce Kline
Mike Hess
Miracle Concepts
Lancaster, PA
(717) 299-7382
Leroy J. Tuscher, Ph.D.
Lehigh University
January 5, 1990
"THE FERRANTI FRAUD"
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DI= DATE DI= PAGE 5
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IM= 8.CPR
DI= PAGE 8
IM= 327.CPR
DI= DATE - May 15, 1990
DI= PAGE 9 "U.S. AGENT CHARGES GUERIN DIRECTED WORLDWIDE FRAUD"
IM= 10.CPR
DI= DATE - May 16, 1990
DI= PAGE 10 "JACOBSON GETS JAIL FOR ROLE IN BRIBE SCAM"
IM= 11.CPR
DI= DATE - May 16, 1990
DI= PAGE 11 "FBI TIES GUERIN TO ILLEGAL MILITARY SALES"
IM= 13.CPR
DI= DATE - May 16, 1990
DI= PAGE 13 "CHRISTIAN ANGERED BY JACOBSON'S SENTENCE"
IM= 14.CPR
DI= DATE - May 17, 1990
DI= PAGE 14 "COURT TOLD ATTORNEY CLARK TRIED TO STOP ISC 'CROOKS'"
IM= 15.CPR
DI= PAGE 15 "CLARK, GUERIN", continued
IM= 16.CPR
DI= DATE - May 18, 1990
DI= PAGE 16 "GUILT IS ADMITTED BY GUERIN COMPANY", PARENT INDUSTTIES, INC.,
IM= 17.CPR
DI= DATE - June 18, 1990
DI= PAGE 17 "JUDGE TELLS GUERIN TO PAY $189 MILLION"
IM= 18.CPR
DI= PAGE 18 "GUERN LOSES CASE", continued
IM= 19.CPR
DI= DATE - May 18, 1990
DI= PAGE 19 "GUERIN COMPANY GUILTY"
IM= 20.CPR
DI= DATE -
DI= PAGE 20 "PROBERS FINDING ISC'S S. AFRICAN TIES WERE CLOSE", ED SYSTEMS
IM= 21.CPR
DI= PAGE 21 "ISC:CLOSE TIES TO SOUTH AFRICA PROBED", continued
IM= 22.CPR
DI= DATE - February 7, 1991
DI= PAGE 22 "GUERIN vs. CLARK 'BLACKMAIL' TAPES REVEALED"
IM= 23.CPR
DI= PAGE 23 "'BLACKMAIL'", continued
IM= 24.CPR
DI= DATE - Febryary 9, 1991
DI= PAGE 24 "LACASTER AVIATION FILES FOR BANKRUPTCY"
IM= 25.CPR
DI= DATE - February 3, 1991
DI= PAGE 25 "GUERIN BREAKS SILENCE OVER '20/20' REPORTING"
IM= 27.CPR
DI= DATE - February 2, 1991
DI= PAGE 27 "STORY: DEALS BY ISC SENT IRAQ BOMBS, BUT GUERIN DENIES SALES"
IM= 29.CPR
DI= DATE - February 9, 1991
DI= PAGE 28 "JUDGE DELAYS HEARING IN GUERIN-CLARK DISPUTE OVER CASH"
IM= STOCK.CPR
DI= DATE - February 14, 1991
DI= PAGE 29 "MANAGER ACQUITTED OF LYING IN SALE OF FERRANTI STOCK"
************************************************************
TI=\IMPLICATED PERSONS EXEMPLIFYING MISCONDUCT AND IMPROPRIETIES
DA= February 17, 1991
SU= IMPLICATED PERSONS AND OR ENTITIES
COMMONWEALTH BANK,
MIKE WOLF