Kyleen Cane, Jan Wallace and Others sued for Racketeering Influence and Corrupt Organizations (RICO) Case No 2:13-CV-00343-JLR.

20140310-phillips-v-cane-et-al-complaint-rico-exhbits-a-s-conformed

20140310 MP v Cane et al Complaint RICO Exhbits A-S (Conformed) – Case No. 2:13-CV-00343-JLR.

This case involves a sophisticated criminal organization (hereinafter “the Organization”) that hides and operates under a patina of legality provided by attorney members of the organization, that uses fraud and deception, as well as employing complex securities maneuvers in order to assume control of small corporations and enterprises, and then uses an extensive network of off-shore accounts and business in order to launder the proceeds of its ill-gotten gains. In achieving its goals, the organization violates multiple state and federal laws, including but not limited to fraud, deception, securities fraud, extortion, money laundering, tax evasion, and threats of violence.

The organization has a number of different members who each contribute different talent to achieve the ends of the organization. Defendant Jan Wallace, as her numerous aliases will attest, is a con-woman, and the femme fatale of the organization, who uses her guile and her sexuality in order to “embed” herself in the corporation or enterprise that is the target of the organization. She is a Canadian citizen who lacks the requisite visa status to work in the United States, and who has used almost as many social security numbers as she has aliases in her criminal ventures. She has a business background that allows her to “speak the language” to up and coming entrepreneurs, many of whom seek her advice and guidance as a “sophisticated, successful business woman.” Once embedded in the target corporation, Ms. Wallace uses her whiles and experience to either loot the target corporation or take control of the enterprise, often using false claims, sexual abuse or fraud. Because she is often the “face” of the organization, Ms. Wallace uses her daughter, defendant Chloe Jardine-Cutler, in order to set up corporations or holding companies off-shore to protect her assets, to launder money of the organization, and to avoid her tax liabilities in the United States. Ms. Wallace also uses her sister, Corrine Mills, to hide her assets. Ms. Mills, a resident of Canada, is a signatory on many of Ms. Wallace’s bank accounts and is used to transfer funds to Ms. Wallace.

Defendants Kyleen Cane (the former Michael Cane nee Michael Eiselman), Claire Ambrosia, Scott Doney, and the law firm of Cane Clarke, LLP, provide the organization with legal advice and strategies that help the organization achieve its goals, often employing complex legal strategies. Defendant Ms. Cane and her law firm own multiple “shelf” corporations, corporations that are legally formed in the State of Nevada but currently inactive. Once Ms. Wallace is able to leverage her position in the target corporation, Ms. Cane devises a strategy that allows them to “reverse merger” the target corporation into a “shelf” corporation owned by the organization, or “cram down” the ownership interest of the other shareholders in the target corporation. Once Ms. Wallace and Ms. Cane assume control of the target corporation, they often employ a “pump and dump” scheme, “pumping up” the value of the stock by making false or misleading claims and then “dumping” or selling some of the shares and moving the proceeds from the sale off-shore to avoid any tax consequence and to protect the proceeds.

Defendant Amin “Andy” Lakha is a wealthy Seattle businessman who owns wide tracts of strip malls and other real estate. He is a longtime friend of Ms. Wallace, is active in investment circles, and is often the conduit that introduces Ms. Wallace to an entrepreneur who becomes the target of the organization. Mr. Lakha introduced Ms. Wallace to plaintiff, telling him that she was an “experienced business woman” and that she could provide him with “expert advice” on corporate governance. Indeed, Ms. Wallace is his right-hand woman; she provides Mr. Lakha with the corporate structures that allow him to “launder” a significant amount of money overseas. Ms. Wallace bragged to Mr. MP and others that she “laundered money for Andy.”

Grace H. Sim, Mujit S. Johal, and Devi Johal are also integral parts of the Organization. Ms. Sim has helped set up some of the corporate structures that the Organization has used to fulfill its purposes. She has also been appointed to the board of directors of several of the companies once Ms. Wallace gains control of the entity. Mr. Mujit Johal is a CPA who is often appointed as the financial officer of the various companies as Ms. Wallace gains control. He is responsible for “maintaining” the financial records of the target corporation and has served on the board of directors of many of the entities. Devi Johal, a resident of the Bahamas, is instrumental in the Organization’s holding in the Caribbean Islands, performing such functions such as transferring stock, opening accounts, and is able to physically transfer asset of the Organization as needed.

Plaintiff became a target of the organization in March of 2006 when he was introduced to Ms. Wallace by Mr. Lakha at a fundraiser in Palm Springs. Mr. MP {“type”:”block”,”srcIndex”:0,”srcClientId”:”40be05aa-187d-4fed-b09a-abb257741de4″,”srcRootClientId”:”dc3b5ce8-0269-448e-88a4-aa64fbf66a2a”}was introduced to Ms. Wallace as an “up and coming entrepreneur in Seattle,” which introduction no doubt caught Ms. Wallace’s attention. At the time, Mr. MP was the sole shareholder of A DOT, a company set up to develop Mr. MP’ IP concerning monetary transactions and transfers. Additionally Mr. MP was the majority shareholder of MOD Systems, Inc., a company set up to develop Mr. MP’ IP concerning the download and transfer of digital content. Ms. Wallace quickly ingratiated herself with plaintiff, by initially offering to advise him on corporate matters, and then dating him. Almost immediately, Ms. Wallace began setting up Mr. MP. She set up a “bizarre method of payment,” and illegally accessed his corporate and personal computer files. When Mr. MP shook up the board of directors of MOD, Ms. Wallace recommended her “attorney,” co-defendant Ms. Cane. Ms. Wallace failed to mention their long, sordid history at the time of her appointment. When Mr. MP cut off their personal relationship, Ms. Wallace approached a major investor in MOD, Mr. Robert Arnold, and made false allegations of wrong-doing against Mr. MP.

When Mr. Arnold filed a lawsuit against Mr. MP and MOD, Ms. Cane was instrumental in convincing MOD to set up a “Demand Review Committee” to review Mr. Arnold’s allegations. She was also instrumental in having herself appointed to the DRC. Once the DRC made a recommendation against Mr. MP and offered a “settlement” that would force Mr. MP to resign as CEO and to place his majority shares in a voting trust, Ms. Cane employed a combination of threats and cajoling to convince Mr. MP to agree to sign the settlement and appoint her as his proxy over the voting trust. Only after Ms. Cane was appointed as Mr. MP’ fiduciary did he discover the long, sordid history or fraud and corporate malfeasance of Ms. Cane and Ms. Wallace. The result was Mr. MP was ousted from MOD and the Organization surely would have raided the MOD coffers if Mr. MP was not able to regain control over his voting trust and put a hold on the MOD bank account. However, by that time, the great majority of the assets of MOD had been misspent and wasted. Plaintiff now sues for the damages suffered as a result of the actions of Ms. Wallace, Ms. Cane and the Organization.