Sunday, January 18, 2009

Ace Reporter Schwebke Reveals More Facts About "Moneyman Leshem" and His Pending Bankruptcy

$44 thousand in delinquent taxes... and other problems

Scott Schwebke provides further information this morning regarding Ogden River Project "moneyman" Gadi Leshem's Cover-All, inc. bankruptcy troubles. Ace reporter Schwebke's been doing his homework and reports that Leshem is delinquent by approximately $44,000 in 2008 property taxes, factoring in the downtown 42 parcels held in his own name, together with another 11 parcels held in the names of surrogates.

Ironic, isn't it? Over the past several years Boss Godfrey and his loyal acolytes have been telling us that the whole purpose of consolidating all these downtown properties into the moneyman's portfolio was to improve the city's tax base. And now Gadi's taking a free ride... on the taxpayers' backs.

According to Gadi's spokeman, however, these tax delinquencies are merely inadvertant error and present no problem at all. "...[T]he property tax matter is an oversight, is not related to the Cover-All bankruptcy filing, and will be taken care of,” Alex Auerbach assures Mr. Schwebke. Seeing will be believing, of course.

We also wonder whether he or his spokeman tendered the same lame excuse ("Oops! we forgot") to his Cover-All employees, when he shafted them just prior to the Christmas/New Years' holidays with $100 thousand (or more) in rubber payroll checks.

Mr. Schwebke also reports that Mr. Leshem's lawyers successfully prevailed on an emergency motion Thursday by Cover-All's lawyers to use an unspecified portion of creditor Bank of the West's cash collateral so the company can continue to operate. We'll presume that the money that's been pried loose by the Bankruptcy Court judge is intended to take care of those disgruntled employees whom, last time we heard, were feeling mighty steamed about those "hot checks."

Although it will no doubt be months before the smoke clears on the Chapter 11 matter, we're betting that even now, Boss Godfrey wishes he never heard of Gadi Leshem. Rumor has it that Godfrey is preparing to soon unveil another Grand Development Scheme involving the Mount Ogden Golf Course. With the Leshem albatross hanging around his neck, it's a sure bet his next moneyman will draw much closer scrutiny than was previously devoted to Leshem.

Further comments, anyone? Schwebke provides plenty of material to discuss.

16 comments:

drewmeister said...

Yay! First post!

dReWmEiStEr said...

May I ask, could someone post a news source link for the Coverall bounced payroll check issue? I'm having trouble finding more information about it (besides the other reference here on the blog). Thank you!

Also, a big thanks to all of you who didn't already think Godfrey was a fucking moron.. those of you who did, well, I'm sure you agree with me that sometimes it sucks being right. I'm so tired of this garbage, figuratively and (looking out my front window) literally speaking.

One more thing, a big thanks to Rudi, for his hard work at exposing the idiocy of the reign.. er, service, of the Mayor of Ogden, and most importantly, for letting hot-heads like myself say it like it is, all the hells, damns, and fks included.

Man, I'm in a sappy, thanking mood today. I don't think my sobriety has fully kicked in yet. ;-)

drewmeister said...

Wait, sorry, found the reference to the bounced payroll checks.

Curmudgeon said...

Not un-related, another story in today's SE, on the business pages. Link here. The story, by Jeff DeMoss, is headlined Commercial real estate market struggling in Davis, Weber counties.

The on-line story does not include the chart available in the paper edition. That chart indicates a vacancy rate for office space in Weber County at the end of 2008 of 22%. The chart lists other indicators as well.

It's not all bad news. The area's two major industrial parks [BDO] seem to be doing well and expanding. But overall for commercial properties, things in general seem to be going south, including among the "mixed use" development where were expected to be major generators of business growth in N. Utah. Chewy story with lots to ponder. Worth a read.

Curmudgeon said...

Interesting that Mr. Lesham forgot [inadvertently, his mouthpiece claims]to pay more in local property taxes than most people in these parts earn in a year. Even presuming [for the sake of argument] the explanation to be so, the tax delinquencies suggest plainly that Mr. Lesham is not an effective manager of his own business affairs, that he's not watching the store [so to speak]... which again raises questions about his ability to successfully oversee a very large multi-use real estate development project like The River Project.

If the Administration has a "Plan B" on the shelf for the River Project, this might be a good time to take it down, dust it off, and let us all know what it is.

ozboy said...

I think their claim that the River Development will not be effected by his companies bankruptcy is most likely BS.

Bankruptcy trustees always follow the money in their attempts to make the creditors whole.

It appears, based on the timing of his not paying California withholding taxes for which he was charged and settled, and his purchase of a lot of Ogden real estate, that there is a very good chance that he got the money for the Ogden purchases from his carpet business and their crooked dealings. If that is the case, then the Ogden properties will most likely be targets of the BK trustee.

The whole fiasco is certainly an indication of the corruptness and incompetence of the Lil Lord and his circle of empty suits. As the old saying goes: "Birds of a feather flock together".

Noni said...

His delinquent taxes seem to be just a small part of the delinquent taxes that are unpaid in Weber County. I just read that the total may well be in the millions of dollars for Weber County.

danny said...

I remember thinking and saying that it seemed odd that Gadi would leave millions of dollars sitting idle, ie the river properties. Now we know. He is just a small timer who looked large due to his willingness to borrow irresponsibly during a finance bubble. Now, he's done, and others will pay for his incompetence - all made possible by government involvement in private business.

And look how the bankruptcy judge shafted Bank of the West. Who would loan money in this environment, where contracts mean nothing?

The good that comes from this is Godfrey's credibility continues to slide as it rightfully should.

As far as the issue of unpaid property taxes in general which has been raised here many times - that is what tax auctions are for. It's time to let them begin. The responsible should not have their taxes raised to pay for the irresponsible.

OgdenLover said...

OzBoy said:"The whole fiasco is certainly an indication of the corruptness and incompetence of the Lil Lord and his circle of empty suits. As the old saying goes: "Birds of a feather flock together".

I had just been thinking (of Godfrey) that men shall be known by the company they keep.

monotreme said...

You're right, OgdenLover. I am blessed with great company -- including a spouse that keeps me on the straight and narrow.

What will it costs us said...

Unfortunatly tax sales may take years and if the property is mortgaged beyond its worth then the user stays on the property and continues to use it since it wouldn't sale even for unpaid taxes.

After 5 years if it is a business the city should revoke the business license in those cases, or deny building permits until taxes are paid up.

So who do we complain to when this summer the homes have weeds, drug dealers and arsonists in the hood? Fines won't do any good if you are bankrupt. Lien the property that is sold so at least the city gets some revenue. What happened to the sale monies for the Wal-Mart parcel that was sold? I'm sure it didn't stay in Ogden.

Bean Counter said...

WWICU

Tax lien sales are governed by the state legislature. Right now it is set at five years from delinquency. The property tax owed comes out first - before any loans against the property. Therefore, the county, and other taxing entities, always get their money, plus interest, before any one else does.

What will it cost us said...

True the tax owed comes out first, but if no one bids on the property because of the outstanding mortgages then the owner continues using the building and business and another tax year is tacked on.

I noticed all the empty buildings on Washington with PPC management. Are any of these buildings behind on their taxes? Who will rent the retail at the junction with all the empty buildings across the street?

Sammy said...

Are you sure about that? I was under the impression that a property sold at a tax auction came with all prior debt wiped out. If there are mortgages on the property they only get the money that is left over after the taxes are paid. Perhaps there are some legal eagles reading this that can clear this up?

googleboy said...

Weber County Delinquent Tax Sale Information

Whistler said...

Bean Counter, you are missing the unfair load put on the on time property tax payers on both ends of this process. First, why should the on time taxpayers provide the money to run the County and State while the delinquent taxpayers don't pay and invest their funds in something else? These same taxpayers get hit again later when the property is sold, the seller will fold in taxes, penalty and interest they have paid into the sale price. This will inflate the selling price and this inflation will work its way into the property tax evaluation process and raises the property taxes of other property taxes in the area.

Let's make it clear, this a collection process that has allowed the tax accountants and tax lawyers to use this loophole for the developers and builders at the expense of the other taxpayers to the tune of millions of delinquent, uncollected tax dollars

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