There's bound to be more than this story (e.g. sloppy reporting).
$3 million bonus plus $5 million bonus plus 8 years of $125,000 each equals: $9 Million legit...versus a $10 Million government claim.
That's a 10% dispute. Odd.
Posted on 04/18/2006 7:38:59 PM PDT by NormsRevenge
A tax accountant embezzled $10 million from a client, then used it to fund a lavish lifestyle that included a $2.2 million California mansion, a $74,000 bat mitzvah for his daughter and the production of three horror movies, authorities said Tuesday.
Prosecutors said Denis I. Shusterman blew through the $10 million over eight years, spending about half on the three B movies. They said he also wrote off many of his good times as business expenses when he filed his income taxes.
As Shusterman's embezzlement and fraud trial opened in federal court, prosecutors also said he gave $495,000 to one of three mistresses and $725,000 to a hospital shipping clerk who soon gambled it away at the craps tables.
"He was totally enamored with the moviemaking business," testified lead witness Leslie Edelman, who owned Kimber Mfg., a Yonkers, N.Y., firearms company that lost the $10 million. "He wanted to be part of it. He wanted the lifestyle."
Defense lawyer Elliot Cohen countered that Shusterman legitimately earned the money from Kimber and was entitled to the tax write-offs.
"The tax laws are designed to benefit many wealthy people. We all know that," Cohen told jurors. Prosecutors "are trying to create the image that these deductions are fishy. They're not. They're in the tax code."
Shusterman's trial is expected to last more than a week.
Federal authorities started investigating him after his mother was convicted in 2002 of helping embezzle $1.3 million from the suburban Philadelphia synagogue where she worked as a bookkeeper. Betty Shusterman, now 74, is serving a four-year federal prison term.
Authorities learned that Shusterman, 44, had moved his family to a $2.2 million home in exclusive Rancho Santa Fe, Calif., in 2001, drove a BMW, took Edelman to the Cannes Film Festival and increased support payments to a woman with whom he had a child, Assistant U.S. Attorney Bob Zausmer said.
Shusterman initially ran a small accounting business and was largely supported by his parents, prosecutors said, until 1996, when Edelman hired him as Kimber's chief financial officer on a consulting basis and paid him an annual salary of $125,000.
Prosecutors say Edelman also approved a one-time, $3 million bonus that gave Shusterman a taste of the good life. He then used Edelman's business as a personal bank account, according to Zausmer.
But Shusterman's lawyer said his client helped the firearms wholesaler go from a startup to a $40 million-a-year business, earning himself a $5 million bonus in the process.
Shusterman declined to discuss the case outside court, but said the California house has been sold. He declined to say where he lives now, citing his desire for privacy. He declared bankruptcy in 1999 and is being represented by a court-appointed lawyer.
In all, Shusterman spent $5.7 million producing three horror movies, prosecutors said. He recouped just $163,000 in video rights on one of them, according to authorities.
Edelman, who invested $200,000 of his own money on the first film, "The Sculptress," was asked by Zausmer on Tuesday what kind of movie it was.
"It was a bad movie," he replied.
Damn, Santorum, RNC contributer , too
Nice Bat Mitzvah. His daughter must be very proud of him.
What an amateur... a wanna-be US Senator, with that kind of behavior ...
And could you tell us where that came from and just what field do you have a degree in??
There's bound to be more than this story (e.g. sloppy reporting).
$3 million bonus plus $5 million bonus plus 8 years of $125,000 each equals: $9 Million legit...versus a $10 Million government claim.
That's a 10% dispute. Odd.
Read the hollywood trade papers like I have for 20 years and you see the movies as a BAD investment..Sooooo,how do the studios get these suckers to invest????The lifestyle baby,its the lifestyle[And maybe being introduced to Tom Cruise}You never realize you've been taken until you get no money back [For further study watch the movie'The Producers"......
My son, the accountant!
"Shusterman initially ran a small accounting business and was largely supported by his parents, prosecutors said, until 1996, when Edelman hired him as Kimber's chief financial officer on a consulting basis and paid him an annual salary of $125,000.
Prosecutors say Edelman also approved a one-time, $3 million bonus that gave Shusterman a taste of the good life."
This is the most curious aspect of this article to me. First that he was hired as a CFO from a small accounting firm (note not a public accounting firm) and secondly, this $3 million bonus?
Maybe the government is claiming that the $10 million is over and above the annual salary and the $3 million bonus. Shusterman's lawyer is the one claiming that Shusterman got another $5 million bonus. That may have been embezzled and part of the $10 million.
I thought bar mitvahs were for jewish teenagers(males) when they turn 14. Maybe I am wrong.
WOW a bonus that equals 1/8 the gros sales of the company. Are they still lloking for areplacement.
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