I'm a scientist, PhD in Biology with over 25 years of work in cancer research. Wanted to do something different, I was looking for a business. I met Ken through craigslist, he had an ad looking for a partner for a healthcare business. I answered to the ad, we met, and he introduced me to the crisis, IRS, EMR system. Im a biologist, so couldnt understand much, but was very impressed by his knowledge and the business. His story was: 1) he is just starting a new company with a system that he won back in court from a company that went bankrupt; 2) he started the company just a few months ago and he was doing very well, so well that he desperately needed help with the management; 3) there were several work-in progress projects due to start very soon; 4) the company has a few part-time sales people; 5) he was short of cash as he lost a lot of money with the company that went bankrupt; 6) he was in the middle of a divorce and has in trust $400,000 due to be released soon; 7) he has a condo in Fort Lauderdale; 8) he owns a townhouse in Langley and the wifes one in White Rock; 9) he has a very successful company in the Caribbean, ITI systems.
That was very impressing indeed, so we met a few more times. He offered me the potential to buy up to 18% of his company by putting 10,000 down and then paying him monthly for up to a year. He also offered me the job of Director of Business Development of EMResponse Systems, with a salary to be negotiated. He provided me very promising financial statements made by his accountant Elroy (sorry never got a last name) and some spread sheets made by Julie the bookkeeper. We kept talking for a month or so, me trying to get more info and trying to get my accountant to talk with Elroy, but he was always out of reach. Elroy was first in a cruise in the Caribbean, then at the cabin, then Arizona.in spite of that, I really believed that there was a business and money to be made. So before we signed the agreement, he took me to a very nice nursing home in which he had installed the EMR system. That convinced me that EMR was a great business and I signed the agreement, gave Ken $10,000. He promised to put back 75% of that into the operating funds of the company. I couldnt believe my luck, such a great business, perfect for my retirement plans.
Very soon after that I went with him to San Francisco to get trained for the 3VR system. That was the cherry on top of the cake, great company; if Ken is related to them so what can be wrong. I paid for all my expenses and filled an expense form when we returned. Ken sent the form to Julie the bookkeeper and I was supposed to get the check from her. Never did, always excuses about Julie loosing things, Julie going to Alberta to visit her sick mother, etc.
One month passed and it was time to receive my first month of salary. Sorry the company does not have any money. That was strange, as I gave Ken $10,000 and he put $7,500 into the company, we did not have an office or any overhead to pay, so why no money? The answer was: we bought inventory from 3VR to get the OEM agreement. So no money, we agreed that we dont take a salary the first month.in spite of that, I paid $2400 towards more shares, did not want Ken to get upset, as the business had a great potential. So no cash, we need to find more money. Need investors. Smart and greedy me, I put $30,000 more, $15,000 for shares and $15,000 as shareholder loan. Why to share such a great business with other people. No problem there, we have such a nice list of work in progress to be starting soon, that I will get my money back soon. Also Ken is putting 75% of the shares payment back into the company, great guy, and great business.
Second month, we went to a workshop in Vegas. A security workshop; Im not sure why we had to go because we were in the nursing home business, but it was a must. I paid for my expenses Kens flight car rental to go sightseeing. No problem, I will always get my money back when Julie finds the time to write the check. Vegas was strange, as Ken went to the workshop only for a few hours, the rest of the time he was working in the room, too busy with all the work in progress.By the way, second month no money for salaries either. How come: I gave Ken $30,000, 15,000 were shares, but he put back 75% of that money into the company, so where did the money go? The answer was: we had to buy more 3VR so that we can get the best agreement. OK, with all the great work in progress that we have, no problem.By the way, work in progress that was supposed to start in February was delayed due to weather conditions, hard winter had construction delayed. No problem, if is not now, money will come soon.
Third month, we needed more money. Smart and greedy me, I made an agreement with Ken that I will put another $10,000 if he increased my right to shares from 18% to 30%. Ken thought about it for a while and agreed. At that time I came to realize that the company was going nowhere, as Ken was not capable of delegating, he was doing everything: sales, financials, marketing, deliveries, etc (or at least he said that he was doing all that). So I pushed to get a few sales people, so that Ken could concentrate on other things. We hired 2 engineers, fired them after a while, as they were never trained properly to do anything, money wasted. I did not know enough to train them and Ken was never around, too busy with the business to train people. I went to a few nursing homes with Ken, great potential, great business, great salesman.
Forth month; no money again. Where is all the money that Im putting into the company? Now it is time to buy Inovonics upgrade for the crisis software. That is where the money is going to. We needed to upgrade to software, as if not, it will become obsolete soon, as Inovonics stopped manufacturing the hardware that goes with it. Oops, I did not know about it, I thought that we had a viable system, we offered them to nursing homes; we never told them that it will be obsolete in less than a year. Probably Ken forgot to mention that to me. So we needed to get the upgrade. Work in progress still delayed. No problem, Ken and I are not taking any salary. Fair enough. I kept putting money to cover the operating cost. $6000, then another $4000. Sorry, not enough, we need to pay $7500 to get the kit from Inovonics for the upgrade (found out later on that was free). No problem, I have a friend looking for an investment. Allan Brady got offer by Ken a consulting job with the company plus an option to buy shares, or the other way around probably. Anyway, Allan is a financial risk analyst, and without any due diligence he gave Ken $24000, as a shareholder loan. Great, now we have money for a few months.
Two weeks later and again no more money. At that time we had an office and a few employees, but after almost 5 months not a penny coming in. How come: where is the work in progress, where is the money from service calls? Julie has all the books, Elroy is out of reach. No problem, Ken had been working very hard getting more work in progress, estimated to $500,000 by the end of the year. Yes, this is a great business. I will get money soon.
Anyway, to get to the end, things between me and Ken were getting hot, as the company was going nowhere, no money, and he was controlling everything, even did not want Allan to help. I always blame Kens inability to delegate, not trusting people and rather doing everything by himself, never thought that he was doing something wrong. One day though, I called 3VR to ask if we can order something and I was told that we dont have any credit, so we need to pay upfront. So how did we buy up till now? The answer: you still did not buy anything from us. Oops, so what were all the invoices that Ken gave me to show me where the money went? Kens answer: sorry we did not buy anything yet. So where is the money, where the invoices came from? Ken: I think that Julie wrote it as miscellaneous expenses. Shit, something is very wrong here.
Indeed, next day I went to the bank and somehow got EMRs bank statements. Disbelief: Ken used that account as his personal one, I put money, gone the next day; Allan put money, gone the next day. Ken also never deposited into that account the service calls, he kept the money and also never paid the technician that did the service. This was just the beginning of the realization that I dealt for six months with a con artist/psychopath. Lost almost $80,000, six months of my life and got a scar that took a long time to heal. There was never work in progress (all fake), the company never bought any assets. Stupid and greedy me, don't ask me why I never checked anything. Ken was great at controlling things and giving excuses for things that did not match up Unfortunately, I was not the first one to be scammed by Ken, and probably not the last one. The worst thing is that EMR had a future if the son of a bitch did the things that he said he will do with my and Allan's money, instead of doing nothing, just stealing the money. Of course he blamed me for all the bad things that happened to EMR but that is typical of Ken, always somebody else to blame.
I will need another few hours to tell you all what I found out about Ken after the facts. That will be for another time.
A few pointers:
No companies: he incorporated EMR after he sold shares of it, ITI systems does not exist at all, he started it with Jim Flannery, but sucked all the money from that company too. He is selling shares without following the BC Securities Act (dont know the Ontario one), so he will be caught for that.
No system: legally it belongs to AMS, but anyway it is worth nothing, as it is obsolete, and cannot be upgraded, has to be written from scratch, so no value at all. If it ever makes any money, I, Allan, Jim and others will go after that money, as we all have shares of companies that had the system as IP.
No Julie, Debbie or Elroy: everything is done by Ken, never got an email for them or a phone number. None of them have a last name, so we cannot track them. They are Ken imaginary friends.
No condo in Florida: Ken rented it a few times for business and got kicked out for not paying the rent.
No house in Langley: Ken was a tenant, also got kicked out for not paying rent.
No house in White Rock: The bank foreclosed on it, the wife rents.
No money in trust for divorce: Ken and the wife are not divorce or going through divorce.
And much more that you can find out if you call me.
If you believe that Ken is offering you a valuable business, here is my advice: do not buy shares of the company. If you want to put money into the business, you need to control the money. You will pay the bills, salaries, etc. No money directly to Ken. You may be good enough to follow his ideas and build a business, but remember Ken is not there to grow the business, he is desperately in need of money, and will suck everything that you put into the company. If you dont want to upset Ken, get a bank account that needs his and your signature to write cheques, use debit, etc. Ken is a great salesman, as all the con artist are, so he may be of help to you, but again, it is your money and you control it. It is standard way of doing business for knowledgeable investors. That was my big mistake, do not make the same. Always remember that Ken knows almost all the tricks, he is done it plenty of times. He also is excellent at delaying things, maniana, maniana. Excuses are his forte. If he is talking about bookkeper or accountant don't stop until you talk directly with them (good luck with that). If there is work in progress, asked for the contracts (good luck with that too) or call the facilities and inquire about the contracts yourself. Ask for the books and the bank statements. It is your right. Very simple steps to check out what Ken is telling you.
Many others have been conned by this liar and we are warning as many people as we can about his activities.
If you would like to know more, you can verify the extent of his current lawsuitss against him in British columbia on the Court services online Website. It is a good place to start.
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