Word: wolfson
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Controversy has not abandoned Wolfson, now a greying man of 54, although he has abandoned most of his ventures except Merritt-Chapman and his profitable hobby of breeding race horses at his Harbor View Stable in Florida (1965 winnings: nearly $1,000,000). Last week a federal grand jury in Manhattan hit him with the first criminal indictment in his career...
Unregistered Sale. Wolfson and an associate, Elkin ("Buddy") Gerbert, were charged with conspiracy in the 1960-62 sale of 690,000 shares of Continental Enterprises, Inc., a Jacksonville company that operates movie theaters. The heart of the indictment is that Wolfson and some associates unloaded the shares without registering the transaction with the SEC, as the law demands for such sales of "control" stock...
According to the charge, Wolfson, his associates and his family controlled both Continental and the patent to an aerosol-dispensing device called Propel-Pak. They swapped the licensing rights on the patent to Continental in return for 35% to 40% of royalties from sub-licensing contracts. Then, says U.S. District Attorney Robert M. Morgenthau, Continental used publicity to puff the price of the stock from $2.75 to $8.50 a share. During and just after the publicity drive, Wolfson sold off 407,000 shares, and his family and friends-including Gerbert, who placed the sell orders with eight different firms-sold...
...Hinting broadly that Wolf-jon was being victimized because of his notoriety, his lawyers said that the charges against him normally would be the basis for only a civil - not a criminal - indictment. If convicted, Wolfson faces a maximum sentence of five years in jail and a $5,000 fine on each of the 19 counts against him - a total of 95 years...
That is not all of Wolfson's woes. In April, as a result of several shareholder suits, Merritt-Chapman & Scott agreed to slash Chairman Wolfson's annual compensations from last year's $525,-000 to $150,000. The settlement came unstuck when the SEC asked the New York State Supreme Court to adjourn the case temporarily. The Commission's lawyer said that it was completing an investigation that could have consider able bearing on the case. Court hear ings resume this week, and the SEC plans to return with what it calls "ma terial facts" concerning...