Just this morning I reported about the trials and tribulations of Stephen Todd Cook and Debt.com getting slammed by the FTC.
Well thanks to a tipster (send in your tips here) it appears Cook has a long standing involvement in the debt relief world and it goes way back to Ameridebt and Infinity Resources Group, both of which were previously shutdown by regulators. In fact it looks like the debt relief trio of Tim McCallan, Andris Pukke, and Stephen Todd Cook all went to Harborfields High School in Greenlawn, NY around the same time.
This comes from the investigation by the receiver of Ameridebt and it truly reads like a soap opera.
Pukke and Baker have mutual friends who have also had substantial business relationships with Pukke, in particular Stephen Todd Cook (“Cook”) and Brian Maller (“Maller”). Caris Decl., para. 11.B. and App. Exh. 10, Transcript of Deposition of Stephen Todd Cook (“Cook Trans.”), 15:10-24 (Cook and Pukke have been friends since high school); Caris Decl., para. 11.C and App. Exh. 11, Transcript of Deposition of Brian Maller (“Maller Trans.”), 13:10-15, 19:9-17. Cook considers Pukke to be as close to him as his family. Cook Trans. 168:18-21. Cook has had ongoing business relationships with Pukke since 1999 through Cook’s employment by Ameridebt and Infinity Resources Group, Inc. (“Infinity”) (Cook Trans. 131:1023, 66:22-67:20), his work for DebtWorks, selling leads to DebtWorks (and to Ameridebt) through various companies, such as Debt Products and NASCO (Cook Trans. 81:25–83:5, 93:1925, 94:3-5), Cook’s formation with Pukke of the entity Prudent Choice, LLC (Cook Trans. 17:10-18) and his recent $700,000 “investment” in Triton Mariculture Ltd., the shrimp farming entity in Belize (Cook Trans. 179:16–181:23), among other dealings.
Maller was employed by Pukke beginning in 1998 through American Debt Counseling Association, then by Professional Equity Trust, a company operated by Pukke’s mother Stella Storm, and later by Infinity, one of Pukke’s wholly owned companies. Maller Trans., 22:7– 23:18, 27:12-18. Maller also worked for Cook at Debt Products, NASCO and Media Choice LLC, and as of November 2005 was employed by Prudent Choice, LLC. Maller Trans. 66:15– 67:2, 90:17–91:21, 9:11–15. At his deposition in November 2005, Maller also testified that he was working under the direction of Baker and Pukke in the post-receivership period in maintaining and modifying the Sanctuary Bay Estates website, the website for the real estate development project run by Dolphin Development. Maller Trans. 114:14–116:5, 118:11–119:1, 119:9–120:5, 120:21–121:10, 121:16–122:10, 126:11–129:21.
3. Summary of Contemptuous Conduct
First, Pukke and Baker have worked together to divert valuable proceeds of sales of property and rights to develop property in Belize held by Dolphin Development. Specifically, Pukke and Baker should be held in contempt of Court in connection with Dolphin Development for the following conduct: (a) Pukke and Baker have remained in possession of and exercised control over Dolphin Development and the Sanctuary Bay Estates project from the inception of the receivership until October 2005 in violation of the Receiver’s right to possession, custody and control thereof; (b) in or after October 2005, Pukke and Baker have caused valuable rights and assets of Dolphin Development to be transferred to one or more newly created corporations and/or other entities to deprive the receivership estate of the property rights, contract rights, development rights and/or other rights held by Dolphin Development, to the detriment and injury of the receivership estate, by transferring those rights to the new Starfish Entities (as detailed below) and Sanctuary Bay Limited; and (c) in December 2005, Pukke and Baker caused Dolphin Development to execute and record a deed conveying Dolphin Development’s real property assets to Sanctuary Bay Limited, the new company formed by Peter Baker in which Baker is the 99.99% owner. Kane Decl., paras. 9-22, App. Exhs. 33-56. These acts not only violate the noninterference provisions of the Preliminary Injunction Order and Stipulated Final Judgment but also violate Pukke’s affirmative turnover, disclosure and repatriation obligations under these orders. The Receiver estimates that the net realizable value of the Sanctuary Bay Estates project is approximately $20 million based on lot sales as of July 15, 2005 and the remaining lots to be sold. Kane Decl., para. 21.
Long after the receivership commenced and after Baker was served with the Preliminary Injunction Order and clearly had knowledge of the Order, Baker created a fictitious business name, Starfish Development Limited (“Starfish”) as well as Starfish Development Limited as a separate company organized under the laws of Nevis (collectively the “Starfish Entities”). Kane Decl., paras. 16, 17 and 20; App. Exhs. 34, 35 and 56. Baker later created the entity Sanctuary Bay Limited in Nevis in which Baker is the 99.99% shareholder and a director. Kane Decl., para. 19 and App. Exh. 54. Baker diverted proceeds of sales of the Sanctuary Bay Estates lots to a bank account opened in the name of Starfish by Baker at Citibank at the end of December 2005. Kane Decl., paras. 16-17; App. Exhs. 34 and 35. Clients purchasing properties in Sanctuary Bay Estates were directed to send their deposits and payments to Starfish at a post office box in Gaithersburg, Maryland which was under the control of Maller. Maller then retrieved the payments and routed the checks to Baker at Baker’s instruction by Federal Express or UPS. Caris Decl., para. 15 and App. Exh. 14. The Receiver believes that there have been approximately $621,000.00 in funds generated from lot sales from the Sanctuary Bay Estates project from April 20, 2005 through May 30, 2006, including both proceeds received by Dolphin Development and proceeds received by Starfish, as of the latest accounting and banking information available to the Receiver. Kane Decl., paras. 16-17; App. Exh. 35. Baker has admitted under oath that post-receivership he established these new companies that have taken over the assets of Dolphin Development, that he has sold lots owned by Dolphin Development, that Baker has rewritten sales contracts from Dolphin Development as seller into the name of his new companies, and that Baker, through his new company Starfish Development Limited, is actively controlling and managing the Sanctuary Bay Estates project. See Section III infra.
Second, the Receiver contends that Baker acted as nominal purchaser of the Emerald Bay Property for Pukke who is the true beneficial owner of the Property. As detailed hereafter, Pukke and his live-in girlfriend, Angela Chittenden, located and selected the Emerald Bay Property and in fact signed the original purchase contract. Ms. Chittenden and Pukke visited the property at least two times prior to the close of escrow. Caris Decl. para. 11.A and App. Exh. 9, Transcript of Deposition of Angela Chittenden (“Chittenden Trans.”) 15:18-16:21, 18:1-7, 18:16-25, 19:8-20:10. Baker received an assignment of the purchase contract from Ms. Chittenden and acquired the Emerald Bay Property with a combination of funds “loaned” to him by Cook, proceeds of the sale of Sportingbet stock from a brokerage account at Walker Crips in London, England and loans from Countrywide Home Loans (“Countrywide”).4 After escrow closed, it was Pukke who engaged and directed an architectural firm to remodel the Emerald Bay Property.
Finally, Pukke has hidden his interest in Sportingbet and its predecessor company, Internet Opportunity and in two accounts at Hansabanka in Latvia. The payments and proceeds of the sale of Sportingbet stock deposited into the account at Hansabanka (“5390 Account”) nominally held in the name of Janis Pukke, Andris Pukke’s father, totaled almost $12.8 million.5
4 The section of this Application describing the circumstances supporting the contempt as to Baker and his acquisition of the Emerald Bay Property detail the blatant falsity of the multiple sworn financial statements submitted by Baker to obtain these loans from Countrywide, including his representation that he was employed by Dolphin Development for over 8 years and was earning $100,000 per month as the “owner/developer.” Baker admitted at his deposition that all of the material statements in his loan applications were false. See Section IV infra. Baker lacks any credibility based on these and other fantastic statements.
5 As detailed in the Receiver’s Fourth Report and the supporting declarations, in February 2004, Andris Pukke submitted a sworn loan application to obtain a loan to purchase 35 Ocean Heights, Newport Beach, California, the residence Cook lives in rent-free. In that loan application signed under penalty of perjury, Pukke declares that he owns the Hansabanka 5390 Account and identifies the account balance that matches exactly to the account balance at the time of the application.
Kane Decl., para. 40; Receiver’s Fourth Report, Tab 11. Janis Pukke testified at his deposition that until sometime after funds started being deposited into the Hansabanka account from the stock brokerage in London, he had no idea why he was receiving payments or how the payments were calculated, how much Sportingbet stock he owned, and what the value of the stock was. J. Pukke Trans. 64:18-65:6, 70:6-16, 73:6-10, 191:2-12, 90:3-22, 143:7-11, 146:10-22, 149:10-150:24. For his part, Baker never had any ownership interest in Sportingbet stock until mid-May 2005 according to an inspection of the Shareholders Register of Sportingbet. Kane Decl., para. 36. Then, not coincidentally, 775,000 shares of Sportingbet stock appeared in a brokerage account at Walker Crips stock brokerage in London in Peter Baker’s name in mid-May 2005. By June 29, 2005, Baker had disposed of all of his stock in Sportingbet and the period from May 11, 2005 through June 29, 2005 is the only time frame Baker is reflected as being a shareholder of Sportingbet. 6
6 The Sportingbet stock held in the name of Baker is in fact Pukke’s stock. The Receiver is still investigating the stock held by Stephen Todd Cook to determine if his Sportingbet stock is also Pukke’s stock. The Court denied Cook’s motion to quash the Receiver’s subpoena to Bank of America. The Receiver has received some but not all of the records responsive to the subpoena and is continuing to investigate other sources of information regarding the ownership of that stock.
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