Alden Shoe
Co. lawsuits allege former CFO funneled millions in embezzled money to Bianca
de la Garza
By Janelle
Nanos Globe Staff,Updated June 15, 2020, 1:36 p.m.
The local
television star and fashion influencer Bianca de la Garza’s Lucky Gal
Productions may have seen its luck run out.
Alden Shoe
Co., a family-owned footwear maker in Middleborough, has filed a civil lawsuit
in Suffolk Superior Court alleging that its former vice president and chief
financial officer, Richard Hajjar, embezzled $27 million from the company and
funneled $15 million of it into the TV and fashion businesses of de la Garza, a
former news anchor who runs a beauty business under the name BDG Enterprises.
Bianca, Lucky Gal, and BDG were all named as defendants in the lawsuit.
The company
also sued Hajjar in Plymouth Superior Court to recover the $27 million,
allegedly stolen from 2011 to 2019.
According to
the court filings, Hajjar bought a $1.1 million New York City co-op apartment
for de la Garza using money stolen from the company and purchased other
extravagant gifts, including a Mercedes-Benz, diamond jewelry, and designer
handbags and clothing. The court has approved the company’s seizure of Hajjar’s
assets held in seven banks and financial services companies, excluding his
pension.
No criminal
charges have been filed.
De la
Garza, Hajjar, and attorneys for Alden Shoe had not as of Monday evening
responded to e-mails and phone messages from the Globe seeking comment.
De la
Garza, a Milton native and Emerson College graduate, was a longtime host and
news anchor at WCVB-TV (Channel 5) before starting her own media company in
2014.
The court
documents indicate that Alden, a New England footwear stalwart founded in 1884,
hired Hajjar in 1987. According to the filings, Hajjar’s father had been the
CPA for the father of the company’s current president, Arthur S. Tarlow Jr.,
and Hajjar’s two brothers worked for the company. Trust ran deep between the
two families.
Hajjar, a
“trusted advisor” to the Tarlow family, eventually rose to vice president and
corporate secretary, a member of the board of directors, and chief financial
officer. Until he was dismissed in 2019, Hajjar was handling “most day-to-day
financial matters at Alden," a filing states.
According
to the documents, Hajjar’s relationship with de la Garza began around 2012,
while she was an anchor at WCVB. The two became friends and vacationed
together, and Hajjar lavished gifts on her worth “hundreds of thousands of
dollars,” according to the documents.
Only in
October 2019 did the company learn that Hajjar’s opulent offerings had been paid
for with money embezzled from the company’s bank accounts, a filing states.
After a forensic accounting investigation, the company concluded that Hajjar
had stolen $27 million since 2011.
The alleged
theft came to light after Tarlow, the company’s president, approached Hajjar
about moving funds from a company bank account into family trusts. At the time,
the company account should have had more than $10 million in it, the filings
state, but Hajjar dodged the request and “after repeated delays and follow-up
requests” assured Tarlow the funds would be wired between the accounts.
Then Hajjar
stopped showing up for work. He told Tarlow, by text message, that he wasn’t
feeling well.
When the
wire transfer didn’t go through, Hajjar allegedly stopped responding to
Tarlow’s texts.
Tarlow
immediately went to his Santander bank branch, where he learned $10 million in
retained earnings was missing from the account, the filing alleges.
Soon after,
Tarlow realized that Hajjar had, without his knowledge or authorization,
“opened and completely drawn down a line of credit” worth $8 million at Bank of
America, the documents say.
In all, the
forensic review found that Hajjar took $27 million from Alden’s bank accounts,
including $3.7 million that he took by writing out checks to himself, the
filings allege.
In several
instances, Hajjar allegedly transferred tens of millions of dollars from the
company’s active bank accounts into another trust account that the company
owned, but which was dormant. Hajjar had himself named a trustee of that
account, then used it to transfer at least $24 million, using those funds to
secretly “write more checks to himself and pay exorbitant personal credit card bills,”
according to the court documents.
The filing
also alleges that $15 million was funneled through that dormant account to de
la Garza and her company Lucky Gal Productions, including over $1.6 million
transferred directly to de la Garza’s personal bank accounts from 2015 to 2019.
And in 2016, Hajjar used stolen funds to pay for both the deposit and closing
costs on de la Garza’s New York City co-op, court documents allege.
Hajjar’s
company-funded gifts to de la Garza, the filings state, included “a
Mercedes-Benz, a $60,000 diamond bracelet, a $158,000 diamond ring, diamond
earrings, designer handbags, designer clothing, and other luxury goods.”
He also
gave his personal American Express card to a personal shopper at Neiman Marcus,
where de la Garza “freely purchased” hundreds of thousands of dollars worth of
merchandise each month, the filing alleges, and Hajjar paid off those credit
card bills using money from Alden.
But Hajjar
didn’t stop at lavishing gifts on de la Garza; he also allegedly transferred at
least $11.5 million directly into the bank accounts for Lucky Gal Productions.
The couple
signed paperwork establishing a “Production Financing Agreement” in 2014, the
year de la Garza left her job as an anchor at WCVB’s “EyeOpener."
According to the agreement, Hajjar committed to paying at least $3.3 million
for the production of a new series but “when or even whether” he could recover
the money was up to the “sole control and discretion of Lucky Gal,” the filing
states.
In a 2018
interview in Forbes, de la Garza discussed her decision to leave the anchor
desk and start Lucky Gal Productions. “So, I went ahead, and I started my
company . . . and I launched a show," she said. "I raised all the
money, got all the distribution.”
De la
Garza’s late-night show, “Bianca Unanchored,” launched in January 2015,
eventually got national distribution, airing on seven CBS-owned stations in
major markets such as Los Angeles, Philadelphia, Dallas, and Baltimore. The
show went off the air in January of the following year.
The filing
alleges that Lucky Gal had “few or no assets” at the time the production
agreement was signed and “did not generate a profit" during the airing of
de la Garza’s series.
“Mr. Hajjar
has never recouped or recovered any of the money that he transferred to Lucky
Gal,” the court documents state, and alleges that “[s]ince its foundation,
Lucky Gal has never been profitable.”
But Hajjar
committed additional millions of dollars to help keep Lucky Gal productions
afloat and, in all, transferred at least $12.3 million to Lucky Gal and its
beneficiaries from 2015 to 2019, the documents state.
Attorneys
for the footwear company filed a letter in November demanding that de la Garza immediately
return all of the allegedly misappropriated funds. They estimated she had
received more than $2.7 million in 2019 alone, including a $230,000 wire
transfer in October, the month Hajjar stopped responding to Tarlow’s texts.
According
to the court filings, de la Garza’s attorney responded to the letter, saying
that she would place all remaining funds from Hajjar into a client trust
account. But she has yet to return any funds.
In the suit
against Hajjar, Alden’s attorneys said he had expressed a willingness to
cooperate and had “never denied” that he had stolen millions. But Hajjar has
returned less than $3 million in assets to the company, transferring back
$214,000 in cash, approximately $20,000 in jewelry, $195,000 through the sale
of gold coins, and $175,000 from the sale of vehicles, according to the
filings. And Hajjar is willing to pay back an additional “$100,000 from the
further sale of gold coins."
Mark
Shanahan and John Ellement of the Globe staff contributed reporting.
 |
Richard
Hajjar and Bianca de la Garza
|
Bianca de
la Garza is firing back — at the media
Facing a
$15 million lawsuit, the former WCVB anchor has hired a lawyer known for
representing President Donald Trump and threatening to sue news outlets.
By Nik
DeCosta-Klipa, Boston.com Staff
updated on
June 19, 2020
Facing a
multi-million dollar lawsuit, Bianca de la Garza is getting some help from a
high-powered lawyer known for representing President Donald Trump and suing the
website Gawker out of existence.
Charles
Harder, the well-known media lawyer representing de la Garza and her companies,
sent letters Wednesday threatening to sue at least two media outlets for
purportedly misstating aspects of the lawsuit against the former WCVB anchor.
Alden Shoe
Company is suing de la Garza for $15 million that lawyers say was stolen from
the longtime Massachusetts-based company by its former chief financial officer,
who was friends with and developed a romantic interest in the TV host. The
civil lawsuit — which says much of the money was used to lavish de la Garza
with gifts and fund her short-lived late-night show — was filed earlier this
month in Suffolk County Superior Court and first reported on publicly this
week.
Harder’s
letters do not address the central premise of the lawsuit.
However,
they do take issue with several “false and defamatory statements” in at least
two articles about the suit and demand a correction and apology from the San
Francisco Chronicle and Esquire, “among other publications,” according to an
email from Harder late Wednesday night. Boston Globe Media Partners, which
includes Boston.com, received a similar letter regarding an article that ran in
The Boston Globe.
In the
letters, Harder takes issues with statements — both in an Associated Press
article published by the Chronicle and a short Esquire blog post — that suggest
de la Garza engaged in criminal embezzlement.
While the
lawsuit says that de la Garza ““knew or should have known” that the funds she
received from former Alden CFO Richard Hajjar were stolen, no criminal charges
have been filed. Alden is also separately suing Hajjar to recover $27 million
in allegedly stolen funds in Plymouth County Superior Court.
Harder’s
letter to the Esquire also disputes the notion that de la Garza was “in a
relationship” with Hajjar, as was written in the post.
“They are
not and have never been in a romantic relationship of any kind,” Harder wrote.
And the
letter disputes the notion that Hajjar “funneled” any of the $15 million into
de la Garza’s beauty product business, BDG Beauty.
“BDG
received no such funds,” Harder wrote.
According
to the lawsuit, most of the money went to de la Garza’s production company,
Lucky Gal. However, the lawsuit also says that she “commingled” the assets of
Lucky Gal with her personal assets and other business pursuits, including BDG
Beauty. As of Thursday afternoon, Harder had yet to respond to an email asking
whether his team disputes the latter claim.
He also did
not immediately say how many “other publications” were sent letters Wednesday,
which threaten potential legal action if the “complete fabrications” are not
corrected by Thursday night. It also demanded an apology for each of the
highlighted statements within the same 24-hour timespan.
“Failure to
do so will leave our clients with no alternative but to consider instituting
immediate legal proceedings against you,” the letters say. “Should that occur,
my clients would pursue all available causes of action and seek all available
legal remedies to the maximum extent permitted by law.”
Representatives
for Hearst, which owns both the Chronicle and Esquire, did not immediately
respond to requests for comment.
Harder, whose
office is based in Los Angeles, has made a name for himself threatening to sue
media outlets — and, at times, doing so successfully. In 2016, he won a
high-profile invasion of privacy case that led to the bankruptcy of Gawker
Media and the demise of its flagship website. Harder has since represented
Trump and his campaign in a variety of lawsuits, both real and threatened,
against major news organizations — as well as against the porn actress known as
Stormy Daniels, who says she had an affair with the president.
According
to public records, the Trump campaign has paid Harder’s firm nearly $2.9
million this election cycle
HISTORY OF
ALDEN SHOE COMPANY
The Alden
Shoe Company was founded in 1884 by Charles H. Alden in Middleborough,
Massachusetts.
It is
difficult to imagine just how active and important the shoe industry was in
Massachusetts so long ago. Early New England shoemaking was a trade based upon
one craftsman making a pair a day in one room cottages (called "ten
footers"). Beginning in 1850 a series of inventions led to mechanized
stitching and lasting operations and the birth of New England shoe industry
followed rapidly. The productivity gains over the traditional shoemaker were on
the order of 500 - 700%, yet the new methods also led to an extraordinary
improvement in both quality and consistency. The explosive growth of the shoe
industry in eastern Massachusetts at the turn of the century was impressive.
Numerous companies were being started, and demand soared as product made its
way west and south on newly expanded rail routes. Charles Alden's factory
prospered, adding children's shoes to their offering of men's shoes and custom
boots.
By 1933, at
Charles Alden's retirement, operations moved to Brockton, Massachusetts and
joined with the Old Colony factory. The Great Depression took a toll on
countless shoe companies in New England. Although production demand increased
during World War II, by the late 40's renewed consumer demand had fueled the
search for manufacturing regions offering lower labor costs. Over the remainder
of the century attrition would take hold as manufacturers looked farther and
farther away in search of low cost labor and materials to meet the insatiable
demand in the U.S.A. for low cost, mass-market consumer footwear.
Most of the
companies who remained in New England could not compete in the demanding
post-war economy. Yet Alden prospered by relying not on lower quality
mass-markets but on high quality dress shoes, and excelling in specialties such
as orthopedic and medical footwear. It was a period of growth and intensive
development at Alden, especially in the design of comfortable, orthopedically
correct lasts. In 1970 a new factory was constructed in Middleborough,
Massachusetts where production continues today.
Alden is now the only original New England
shoe and bootmaker remaining of the hundreds who began so long ago. Still a
family owned business, still carrying forward a tradition of quality
genuine-welted shoemaking that is exceptional in every way.
.webp)
No comments:
Post a Comment