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May 13, 2015

Oregon Tax Firm Sued for Ripping Off Adult Retailer's Kids

PORTLAND, Oregon—The possibility exists that tax attorney Jeremy Swanlund and CPA Nathan Wheeler, both formerly of Bridge City Advisors, are not good people—and it doesn't have anything to do with the allegation that they paid people to get medical marijuana cards so they could have an excuse to grow lots of pot to sell and ship out of state. IRS Special Agent Scott McGeachy has filed a 27-page declaration with the U.S. District Court in Portland, charging that Swanlund and Wheeler "are growing substantially more marijuana than the [Oregon Medical Marijuana Program] allows" and have "distributed marijuana to states such as Washington, Idaho, Wisconsin and New Jersey." The allegations are based in part on the fact that when investigators searched Wheeler's home in Happy Valley (!), they found just over 300 plants in his garden, but found that the home was only a registered grow site for 19 medical marijuana users—a violation of state rules governing growers. But never mind about that: What makes this story news for AVN is how Wheeler allegedly ripped off the heirs of David Coverdale, owner of an adult business named DK Wilds (now known as Mr. Peeps Too). Seems that Wheeler and his bro Howard rescued construction mogul Greg Myers, who had run out of money to finish building a new housing development, Trotter Downs Phase II, with a large infusion of cash—and almost $740,000 of that cash was actually from the sale of Coverdale's assets, over which Wheeler was the trustee. "Two days before Coverdale's death on April 21, 2011, Wheeler and Swanlund met with him to craft a new will that would leave the adult entertainment businesses to a trust in the names of Coverdale's two sons," Brian Denson of The Oregonian reported. "Wheeler, who had served as Coverdale's CPA, was named trustee. He was responsible for selling Coverdale's assets, which included his home and the porn shop property and building. "According to the court document, Wheeler wired $737,502.16 from the Coverdale estate to West Coast Bank to buy out that line of credit on Trotter Downs Phase II," Denson continued. "But while Wheeler took the majority of proceeds from sales of the first three houses in the development, he never reimbursed the trust that Coverdale established for his sons." And what did Wheeler do with the money? Well, first of all, McGeachy says Wheeler lied to the mother of one of Coverdale's heirs, claiming that because of a lawsuit filed by two boys who claimed they were molested in one of DK Wilds' arcade booths, all funds in the trust were frozen pending the outcome of that suit—a lie, by the way. Wheeler instead used what was left of the trust funds for, among other things, plane tickets, a night at the Hard Rock Hotel & Casino in Vegas, expensive meals in several states—and drinks and tips at one or more of the Stars Cabaret strip club's four locations in Oregon. Wheeler also allegedly wired cash to a bank account owned by Swanlund, made a loan to his and Swanlund's now-defunct gentlemen's club, Club Rouge—and gave $3,960 to his (Wheeler's) ex-wife and $4,000 to his current fiancee. It's unclear whether Cloverdale's kids will ever see a dime of their inheritance—especially since, as the Oregonian reports, Wheeler and Swanlund also allegedly ripped off "snowboarding legend" Danny Kass for $40,000, which would also have to be repaid.

 
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