Eric Levine, the founder of the now bankrupt California Wow Xperience (CAWOW) fitness clubs in Thailand, on Wednesday denied fraudulently transferring huge amounts of company funds overseas.
CAWOW has been accused by the Anti-Money Laundering Office (Amlo) of cheating its customers and shareholders by reporting losses while transferring 1.69 billion baht out of Thailand over a 10 year period.
A large number of angry members filed complaints with the Department of Special Investigation (DSI) in October 2012 accusing the CAWOW of fraud.
Mr. Levine gave a statement to the media saying he had submitted documentary evidence to Amlo proving his innocence.
He said the documents give a full disclosure of the company’s financial records, and included a letter denying any wrong-doing. He said he would allow Amlo to have access to and investigate CAWOW’s bank accounts and business activities.
“I state with absolute certainty and in the strongest, most unequivocal terms that CAWOW operated transparently and that neither I nor any directors or staff members ever made any improper or illegal transfers of even a single baht out of the company,” said Mr Levine.
CAWOW has been accused of transferring 364 million, 495 million and 416 million baht out of Thailand in the three year period of 2009-2011, in addition to large sums during other years.
Mr. Levine’s statement said that “Any transfers of this scale would be almost impossible to execute since the amounts represent nearly half of CAWOW’s entire income in the related years. Even the most cursory audit would easily detect such massive transactions.”
As a listed public company, CAWOW was a listed company and therefore monitored by such independent government entities as the Securities and Exchange Commission, the Stock Exchange of Thailand, and the Bank of Thailand. Respected auditors also audited CAWOW’s financial reports were also audited by respected auditors, the statement said.
Mr. Levine claimed the records clearly showed that rather than taking money out of the company, he actually transferred almost 65 million baht into the company through his own companies and associates, with a large portion of that as recently as 2011.
He also claimed CAWOW could have survived if the plans and actions underway for its recovery had not been undermined by “illegal actions”, and pointed to the political disturbances and flooding crisis of 2011 as events that seriously affected the company’s business.
The statement also read “It would still have been possible for the company to recover and continue to provide services to members if the landlord of six of our clubs had not interfered in the ability of members to make use of the facilities by obstructing access or disrupting the supply of electricity and other utilities.”
He said CAWOW lost more than 200 baht in revenue because the landlords of the clubs’ facilities ignored court orders to re-open the clubs and provide utilities, and the company was unable to recover from this loss. Image/Google Images