Strack?s Take on MSF

The following paragraphs are excerpted from Joseph I. Strack’s sworn affidavit, which was given in February as part of the suit and countersuit between the Moore Stephens Frost accounting firm and Strack filed in Pulaski County Circuit Court. Text in brackets is supplied for context:r

“On or about June 7, 2000 … partner/member Dan Peregrin … explained to me that one of the best ways to make additional money … was to earn commissions from the sale of insurance through Millennium Insurance Services LLC, an affiliate of MSF. He explained that the MSF partner/member who was responsible for the ‘lead’ for the sale was entitled to a 45 percent share of the commission earned by Millennium on the sale. The remaining 55 percent of the commission was shared by all the partner/members of MSF and another MSF affiliate through a series of allocations and distributions.r

“During October 2000, I was appointed to chair a committee charged with evaluating the tax department procedures used by MSF. … I presented the committee’s recommendations to improve MSF practices and procedures to the partners of MSF in early January 2001. As implementation of the recommended practices and procedures began, [partners] C.F. [Cheryl] Shuffield, Gibbons and Peregrin began to raise issues about the practices and procedures, refused to follow the ‘Best Practices’ recommendation of the committee, allowed staff members to not abide by the procedures, and ultimately single-handedly stopped any substantive implementation of the proposed tax procedures within MSF. In addition, on several occasions, an MSF employee informed me of the practice of deceiving the Internal Revenue Service by filing false tax return extensions.r

“After [a] meeting on Aug. 6, 2001, I wrote a memo for Mr. Flesher to use in his discussion with the MSF partners/members regarding my situation. In this memo, I again informed Mr. Flesher that I was unhappy about the fact that MSF was practicing unethical accounting… I felt the actions of MSF were putting my license and career at risk and my professional reputation on the line.” r

rMSF PartnersrAs of Sept. 1, the partners in Moore Stephens Frost were:
rGreg Barnes
rBob Childress
rDennis Cooper
rTed Duncan
rKeith Ekenseair
rGreg Flesher
rTom Gibbons
rRachel Kremer
rTammy Lisko
rDan Peregrin
rDoug Richardson
rCheryl Shuffield
rGini Vanness
rSource: Moore Stephens Frost