Oct 6, 2008 10:52 pm US/Central
Diving Into The Documents Of Petters' Allegations
(WCCO)
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On Tuesday, Tom Petters will appear in federal court where prosecutors are expected to ask that he continue to be held without bail. (File)
Ethan Miller/Getty Images
Tom Petters, former CEO of Petters Group Worldwide, is being held at the Sherburne County Jail in Elk River. On Tuesday, he will appear in federal court where prosecutors are expected to ask that he continue to be held without bail.
Investors started filing lawsuits against the businessman on Monday. They say Petters mislead them into giving him millions of dollars. A lawsuit filed by three investors said they loaned Petters $46 million just three months ago. Attorney Mark Al, who represents some of these investors, said his clients are devastated.
"We have got one client for more than $43 million, we have individuals who are in for up to a million each. That is a lot of money, that is not peanuts. They are very, very upset about it," Al said.
According to court documents, Petters personally guaranteed these loans. And that means these investors can go after his personal property, like his home in Wayzata.
Petters allegedly told investors he was buying millions of dollars of electronic goods and reselling them to Sam's Club and other discount stores.
However, one of the companies Petters was supposedly buying from apparently doesn't exist. Petters showed investors invoices from Enchanted Family Buying Company, showing he had purchased electronics from them and resold them.
The headquarters, according to invoices, is located at 701 Highway 7 in Excelsior, Minn. But that building is a paint store and an auto body shop. The paint store owner said the building used to be owned by Michael Catain.
Catain is charged along with Petters in the scheme. The search warrants, that are open to the public, show that the day after Petters' company and home were raided, Petters company wrote the U.S. government a $1 million check in an apparent tax payment.
And among the items seized at Petters home include $13,000 dollars in cash, numerous credit cards, a .22 caliber revolver and 11 high-end watches including four Rolexes.
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