LOS ANGELES (CN) – Axium Holdings CEO John Visconti and COO Ronald Garber who run one of the entertainment industry’s leading payroll service firms are accused of using Axium as their “personal piggy bank to finance their extravagant lifestyles,” in an action filed by Golden Tree Asset Management in Federal Court. Golden Tree and others invested $130 million in Axium.
The suit says Viconti and Garber pocketed “untold millions of dollars in cash and other assets,” while running a multi-year tax fraud, understating Axium’s liabilities by “tens, and perhaps hundreds, of millions of dollars.” The investments by Golden Tree and others were secured by the looted assets, says the complaint in the U.S. Central District of Califoirnia.
Defendants include John Visconti aka Bijan Manoochehri aka John Manocheri, Ronald D. Garber, Unity America Fund, JVE Enterprises, Maha Visconti, and Susan Cruz.
The complaint continues: “While Defendants John Visconti and Garber in particular gorged themselves on the fruits of their deception and fraud, Axium, its clients and its roughly 550 employees suffered, ultimately with the loss of their jobs. When the IRS recently began to unearth Defendants’ fraudulent scheme, Defendants John Visconti and Garber directed Axium to pay to the IRS tens of millions of dollars in previously undisclosed past-due tax liabilities, and unnecessary interest and penalties, in the hope of preventing the IRS from asserting personal liability against them. Defendants’ patterns of fraud, theft, gross mismanagement and waste resulted in each of 40 Axium entities seeking bankruptcy protection on Jan. 8,” the complaint states.
Plaintiffs are represented by Latham & Watkins. See complaint.