Oct. 21, 2007 — Former CEO of Innovative Communications Corp. Jeffrey Prosser used monies belonging to his now bankrupt companies to fund lavish lifestyles not only for himself, but for his wife and children, according to court documents. Now the trustee in the ICC bankruptcy proceedings has asked that a federal court force the Prossers to turn over millions of dollars worth of jewelry, fine art and other items that the trustee says were paid for by the companies.
"Jeff Prosser utilized the Debtor [Innovative Communication Corp.] and the Parent Debtors as his personal 'piggy-bank' to fund a lavish lifestyle characterized by multiple residences, private jets, luxury automobiles, collecting rare wine, and accumulating fine art and expensive jewelry," Stan Springel, the court-appointed trustee, wrote in his complaint filed Friday in U.S. District Court on St. Thomas.
"To support his lifestyle and those of his wife and children, Jeff Prosser caused subsidiaries of the Debtor to upstream funds to be used by the Debtor to purchase luxury goods and services for the benefit of the Defendants rather than for legitimate corporate purposes. Each of the Defendants was a knowing and willing beneficiary of Jeff Prosser's actions."
Included among the subsidiaries of the debtor are the Virgin Islands Telephone Co., The V.I. Daily News, Innovative Cable TV and Media, and Vitel Cellular.
The list of art and jewelry totals $9.1 million. ICC also paid for the insurance on the items. They include four paintings by Camille Pissarro, one valued at $3 million, a Bernard K. Passman black coral necklace with 736 brilliant White Russian diamonds valued at $400,000, and a man's diamond ring and watch with a joint value of $157,760.
The most valuable piece of jewelry listed is an "18 WG [white gold] Chopard ruby and diamond bracelet with 37 rubies, total weight 54.3 carats, and 61 diamonds, total weight l3.25 carats." It was insured for $596,850.
The complaint names as defendants, Prosser, his wife Dawn Prosser; children Sybil, Justin, and Lyndon Prosser and Michelle LaBennett, and his brother Michael Prosser.
Springel asks the court to require the defendants to turn over property that was acquired through Prosser's use of corporate funds. He has also asked for a restraining order to prevent the destruction or disposal of the millions of dollars of personal property Springel says belongs to the debtor and is thus part of the bankruptcy assets.
In asking for the restraining order, Springel writes, "Much of the Property can be easily transported, hidden, and/or disposed of. Further, if the Defendants attempt to transport any of the Property, damage to the applicable Property could be sustained or its value impaired or lost." Springel says property will be returned if any of the defendants can prove a right to it. To the extent that the Defendants can prove the property was not purchased by ICC "they will not be injured by this Court's preliminary injunction requiring an accounting for and safekeeping of the Property during the interim."
The trustee paints a picture of the methods used by Prosser to "upstream" funds he used to buy a life of luxury for he and his family.
"For several years, Jeff Prosser has instructed the Debtor to use its funds to acquire personal property for the benefit of himself and the other Defendants. As Jeff Prosser exercised pervasive control of the Debtor and had the ability to terminate employees on a whim, the Debtor's employees followed his instructions. As a result, the Defendants have acquired personal property (collectively, the 'Acquired Property'), including, but not limited to, jewelry, art, automobiles, personal watercraft, fine wine, silverware, negotiable and non-negotiable securities, season tickets to sporting events and related seat licenses, country club membership, clothing, rugs, furniture, antiques, and other home furnishings and luxury goods with the Debtor's money."
The three other Pissarros listed are valued at $1 million, $800,000 and $205,302 each. Pissarro, known as the "father of Impressionism," was born on St. Thomas in 1830 and grew up there. A reproduction of "Paysage des Antilles: St. Thomas" — the $205,302 work — is available on the Internet for about $230.
Other household items listed on Springel's schedule include a 19th Century French "bronze and rock crystal chandelier" worth $170,000, a 15-foot by 17-foot "floral aubusson rug" at $150,000, a smaller but similar rug for $100,000 and valued at $50,000, a "French regency writing desk with gold leaf and brown leather top, and one drawer."
Along with the jewelry and objets d'arts, Springel says, "Jeff Prosser has also compelled the Debtor to finance extravagant social events such as family parties and weddings, and to pay for the construction of personal residences or the leasing of same."
One of his children lives at Trump Tower in New York City where he attends college, while Prosser's former companies, according to Springel, were footing the bill.
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