Former Wisconsin Senator Sues Over Alleged Massive Illegal Conspiracy
Lawsuit accuses prominent bank and multi-state e-waste recycler of civil fraud
21 Jul, 2020, 14:00 ET
LADYSMITH, Wis., July 21, 2020 /PRNewswire/ -- Kevin Shibilski, former Wisconsin State Senator from Wisconsin's 24th Legislative District, represented by Johnson & Bell, filed civil fraud and conspiracy claims against James Moss, Thomas Drake, and other former business partners in the Western District of Wisconsin today. The lawsuit also identifies Ladysmith Federal Savings and Loan as an active participant in the fraud scam.
Shibilski alleges that Drake and Moss, along with Vice President Bonnie Dennee, used false books and records to lure investors for their waste recycling company, 5R Processors Ltd. Headquartered in Ladysmith, Wisconsin, 5R Processors was involved in recycling electronic equipment, appliances, and other assets. The corporation operated numerous facilities and warehouses in Ladysmith, Glen Flora, Catawba and West Bend, Wisconsin, and in Morristown, Tennessee.
"Shibilski was a victim of a group of fraudsters who duped him into investing in 5R Processors by falsifying books and records which hid hundreds of thousands of dollars in unpaid tax liabilities and ongoing environmental schemes involving hazardous waste storage," said Mark Belongia, attorney from law firm Johnson & Bell, who is representing Shibilski.
Following charges filed earlier this year by the United States Attorney for the Western District of Wisconsin, Drake, Moss, and Dennee have all pleaded guilty to conspiring to commit hazardous waste violations after a joint investigation by the Wisconsin Department of Natural Resources, the United States Environmental Protection Agency and the Internal Revenue Service. Moss also pled guilty to tax fraud charges.
Shibilski, who is seeking millions in damages, also charges his former partners with starting a competing company and stealing all 5R Processors' assets including cash, equipment, confidential company data and customer lists shortly after receiving his investment funds.
"These bad actors left Shibilski with nothing but the company's debt," said Belongia. "The bank was part of the conspiracy by being the lender for the new competing company in which the bank president is an investor and its landlord."
Shibilski served as a Wisconsin State Senator from 1995 to 2002. While in the state senate, the Wisconsin Education Association Council recognized Shibilski for his work improving education. Shibilski authored Wisconsin's Mining Moratorium Law (1997, Senate Bill 3). He received numerous awards for conservation by the Wisconsin Wildlife Federation, and recognition from the Nature Conservancy for conservation issues. He led the fight to reauthorize the Stewardship Fund in 2000 to protect natural areas, wildlife habitats, water quality and fisheries. As a state senator, he authored the Labor Education Bill and the repeal of the Quality Economic Offer (signed in 2009). And, in recognition of his commitment and service in combating poverty, he earned the Gaylord Nelson Human Services Award in 2000.
Shibilski graduated from Stevens Point Area Senior High School and received a B.A. in English from the University of Wisconsin–Stevens Point.
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