Where Is Stan Cheralstein From Phar Mor Case Today
COMPANY NEWS
COMPANY NEWS; Phar-Mor and Its Unfashionable-Auditor Clash on Fraud Character
Consider the article in its original linguistic context from
Grand 6, 1992
,
Section D , Page
4Buy Reprints
TimesMachine is an exclusive benefit for home legal transfer and digital subscribers.
About the Archive
This is a digitized version of an clause from The Times's print archive, before the start of online publication in 1996. To preserve these articles as they originally appeared, The Multiplication does not falsify, cut or update them.
Occasionally the digitization cognitive operation introduces recording errors Oregon else problems; we are continued to bring on to improve these archived versions.
Coopers & Lybrand, a Big Vi auditing firm, blamed its former client, Phar-Mor Inc., and Phar-Mor goddam Coopers yesterday for not uncovering more promptly $350 million in fraudulent profit reports and a multimillion-dollar embezzlement that the bank discount drug chain says it found.
As Phar-Mor executives disclosed further details yesterday, several members of Congress aforesaid the company's charges bolstered the pillow slip for tighter Federal auditing regulations. The Sign Energy and DoC Committee unanimously approved a bank note last week that would offer civil penalties for auditors WHO fail to alert company executives, gameboard members and Federal regulators when there is evidence of fraud.
Harris J. Amhowitz, deputy chair and general counsellor of Coopers & Lybrand, which was dismissed as outside auditor by Phar-Mor on Tuesday, said the owners and directorate of the 301-store mountain chain had been "closely allied" with the erstwhile executives, who the board "now claims are crooks."
"Collusion and fraud did not occur in a vaccuum," he added. "This whole affair is unusual and apparently designed to posture, brag and transfer blame." A Case of Organism 'Duped'
David S. Shapira, Phar-Mor's chair, replied that he and other plank members had been "duped" by Michael I. Monus, WHO was dismissed as Phar-Mor's president after the discoveries.
"I always thought the argue you hired auditors was so they could distinguish you about things like this," he said. "To miss something of this size up is hard to understand."
Mr. Shapira, whose family company, Giant Bird of Jove supermarkets, owns 35 pct of Phar-Mor, which is supported in Youngstown, Ohio, said Coopers & Lybrand had been "clearly instructed" to investigate the accounts that turned out to represent fraudulent. Helium said Coopers had given "very strong assurances that everything was in order."
When the company began its own investigation last week, Mr. Shapira said, IT found about $10 jillio in checks on Phar-Mor accounts made outgoing to the World-wide Basketball League, a project of Mister. Monus's. The league abeyant operations last week afterwards Mr. Monus stopped subsidizing its losings. A Missing Person
Mr. Monus has not commented since the company made its charges Tuesday and the Federal Bureau of Investigation aforesaid IT was investigating. Phar-Mor aforementioned it did not know where Mister. Monus was. Youngstown State University also same yesterday that it had not been able to reach Mr. Monus, World Health Organization is chairman of the school's trustees.
Mr. Shapira same the Monus family still had "a considerable investment" in the company, although Mr. Monus's father, Nathan, had unhopeful from the Phar-Mor board.
"I'm on the board, I've been involved in setting the general counsel for the company, but the daytime-to-twenty-four hour period direction all according to Mickey Monus," Mr. Shapira aforementioned.
He said Phar-Mor was "getting real good cooperation and support" from banks that supplied a $600 million revolving credit line and $155 zillion of older debt and from its suppliers.
Shares of the Foxmeyer Corporation, a Dallas-supported supplier to Phar-Mor, fell $1.25 yesterday on the Unprecedented House of York Tired Exchange, closing at $11.625, pursual a $1.125 decline after Phar-Mor announced the fraud charges on Tuesday.
Jonathan Williams, a spokesman for the PNC Financial Corporation, the holding company for the Pittsburgh National Bank, which united County NatWest in syndicating Phar-Mor's revolving credit to other banks, said he could not comment connected the discussions with Phar-Mor.
"PNC's exposure is relatively modest, is secure and should have no material impact on PNC's earnings," he same. PNC shares rose 12.5 cents yesterday, closing at $51.625 on the Big Board.
Chemical Bank, which joined PNC and NatWest in arranging the private placement of Phar-Mor's 9.11 percent senior debt, did not invest in the debt. Chemical has a bit part in the revolving citation syndicate, banking analysts said.
Mr. Shapira same Phar-Mor was "examining all of our options," including mayhap filing lawsuits.
Representative Ron Wyden, an Oregon Populist who sponsored the audit legislation, said it would require auditors to "look for harder for fraud."
But A. A. Sommer, a Washington lawyer who is chairman of the Public Oversight Instrument panel of the American Establish of Certified Public Accountants, said the question was "whether the fraud is cleverly covered awake and so that auditors can't watch IT." He added, "If the fraudulence involves collusion among a numeral of people, the ordinary auditing procedures wouldn't necessarily unveil IT."
Phar-Mor aforesaid Mr. Monus, Patrick Finn, who was ousted Eastern Samoa CFO, and two other accountancy employees had been involved in the shammer.
Where Is Stan Cheralstein From Phar Mor Case Today
Source: https://www.nytimes.com/1992/08/06/business/company-news-phar-mor-and-its-ex-auditor-clash-on-fraud-case.html
0 Response to "Where Is Stan Cheralstein From Phar Mor Case Today"
Post a Comment