BizRadio – As I’ve said – Something smells Frishy

The more that seems to surface the more concerned folks seem to be – and with good reason.

In an earlier blog I indicated that I, through email, made an attempt to interview Daniel Frishberg – as I felt that he (being silent other than his email broadcast in the last two weeks) should have an opportunity to express his opinion regarding the flurry of controversy regarding his actions and those of BizRadio.   Thus far no response and frankly, I do not suspect that I will receive a response.

But, in the interest of openness, transparency and full disclosure, below are the questions (in Blue) that in writing (via email) I sought Mr. Frishberg’s answer to:

QUESTIONS:

  1. According to Ron Crider, he and Mr. Frishberg are 50/50 owners of BizRadio Colorado – is that correct?  If not, what do you two own, if anything, together?
  2. Mr. Crider stated that he was brought into BizRadio in October 2009 and introduced to shareholders (in two separate shareholder meetings toward the end of 2009 or early 2010) as BizRadio CEO?  Is that correct?
  3. Mr. Crider was listed in late 2009 as the President of Broadcast Operations on the BizRadio website – was he an employee in that position?  If not, what was his capacity?  If he received no compensation, then what do you suspect motivated his association with BizRadio in a titled position (per the website) without current compensation?
  4. Mr. Crider stated that he suggested the sale of 1110 AM to Rehan Siddiqi so that BizRadio could move to 1180 AM (reportedly a station with a stronger signal)… is that accurate?
  5. Mr. Siddiqi was listed on the BizRadio web site as Vice-President of Marketing.  How long did he hold that position with BizRadio?  How would you describe his service in that capacity?
  6. You have stated something to the effect that you felt that Crider and Siddiqi attempted to obtain 1110 AM for less than fair market value (to steal it from you – my words paraphrasing yours) – when do you think that scheme got cooked up?  What motivated that action in your opinion?  What did Crider have to gain from Siddiqi’s lease/potential purchase?
  7. What caused Entravision to issue the letter to BizRadio regarding not providing the letter of credit or deposit of $150,000?  If, in fact, Siddiqi paid BizRadio $180,000 wouldn’t BizRadio have had the $150,000 needed to continue broadcasting on the strong signaled station?
  8. The Houston Chronicle reported that the check which shows a signature by Albert Kaleta was reportedly “forged” – is that your position?  If so, who do you suspect forged Mr. Kaleta’s signature?
  9. Several investors have reportedly written or called you suggesting that you turn over operations to Mr. Crider – is that a possibility?
  10. Since Mr. Kaleta is effectively barred by the SEC from interacting with any investment advisor and since you are a licensed investment advisor, does Mr. Kaleta’s disconnection with you and (one would assume) BizRadio have any effect on the ability to attract more investors?  If not, how will future investors investments in BizRadio be structured (loan with a guaranteed interest rate) or (shareholder)?
  11. It would appear that Mr. Siddiqi is out a substantial sum of money as a result of this whole ordeal.  What position does BizRadio take since it effectively kicked Mr. Siddiqi off the air?  Does BizRadio plan to reimburse him the funds he is out?  If so, when (or has it already taken place)?
  12. It has been reported that you have moved assets (DFFS Capital Management, Inc.) from your name to your wifes in order to avoid any issue with the SEC should they conduct an investigation (expanded from Kaleta).  Is that true?

Since that email was sent (with no reply as of this writing) several more questions exist:

  1. It has been reported that an announcement was made to BizRadio employees on Wednesday or Thursday that BizRadio was being sold for $3.5 million back to SALEM.  Now, if Frishberg bought KTEK for $7.7 million from Salem and Salem is buying it back for $3.5 million then does that mean that Salem is taking a $3.2 million or so loss?
  2. Wallace has (had) a lien against BizRadio assets (which logically would include KTEK) for some amount.  What impact does the sale to Salem have on the security that Wallace was to have in BizRadio?
  3. Since Frishberg originally agreed to lease/sell 1110 AM to Siddiqi for $3.5 million, then cried to the courts that he (Frishberg) was being swindled by Siddiqi and Crider, what does the sale back to Salem mean?  Is the value really $3.5 million?  If so, then how did Siddiqi and Crider swindle Frishberg?  Rather, did Frishberg use Crider to swindle Siddiqi (who is still out $180,000 and a radio station)?  Did Frishberg lie to the court when he talked about the value?  And, did Frishberg perpetrate a fraud on Siddiqi so that he could get Siddiqi’s funds (since it seems that money is a precious commodity at BizRadio these days)?
  4. Did Salem force the sale since Frishberg was reportedly behind in his lease (i.e., is Salem foreclosing)?  Is this SALE to Salem contingent on BizRadio having some lease back provision?  An what does this reported sale mean to the investors who are (as each day unfolds) seeing less and less chance that they will ever get their investment back.
  5. It is reported that Frishberg is also promoting that he has struck a deal with Salem for 3 hour daily show on at least 6 Salem station across the country.  Salem is reported to have a squeaky clean reputation and image.  So what is the truth involved here?  Sale to Salem or not?  Behind in payments to Salem or not?

NOTE: From a reliable source, I was told this a.m. that notice has been given from Salem that they need to be prepared to take over the station.  No more details, but it would appear that Salem is in play.  Further, it is reported that Frishberg is asking to be given a little more time for BizRadio to come up with the $150k LC on that last Friday before Biz was taken off KGOL.  Seems that the writing is on the wall…Frishberg will soon be off 1110 AM and is desperately trying to scramble to find funds to get back on 1180 AM.  How that could happen is beyond me, but then again…this is typical of how a fraud unfolds as it is collapsing.  Let me put it this way…if there is no investor fraud or (what I’ll refer to as) fraud against Siddiqi here…it would be a bit of a miracle.

Unrelated to the reported deal to sell to Salem other questions came to the forefront that seem noteworthy:

  1. Frishberg is reported to be paying $9,000 lease on a personal residence at Royal Oaks Country Club.  Nothing wrong with that as long as funds to pay the rent/lease are coming from sources that have not in any way negatively affected the investors who may not have had a clue of the intertangled actions of funds between Kaleta and Frishberg.
  2. Likewise, it was reported today that Frishberg uses Kaleta’s credit card for purchase and/or flights.  Now, if that is true, isn’t that playing with fire since Kaleta was banned (via SEC) from having any involvement with any investment advisor (which Frishberg is)?  I can’t honestly imagine that Frishberg would do that, but thus far most items that have been reported to me have (over time) been confirmed.  Go figure?
  3. Here’s Albert Kaleta’s LinkedIn profile.  He’s still showing here as a owner of BizRadio.  Perhaps he’s just failed to change it, but no association seems that he should have removed himself from any involvement with BizRadio.  Maybe I’m missing something?
  4. Lastly, I was told that the transmitter site’s property insurance has lapsed.  I suppose that as long as the power bill is paid the transmitter can continue to work, but at what risk if there is no insurance?

Folks…what seems to be evident are the dying gasps of an investment scam that has gone bad.  And, if not a scam…then surely evidence of folks who are inept at running a successful business.  Of course, the full truth is not yet revealed…but with all the activity surrounding what’s taking place…I suspect that the speed of the collapse will gain momentum.

Sorry, wish the news were better.  But if there has ever been something that smelled FRISHY when it comes to Business Ethics…this is it!

…and comments are welcome.

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6 Responses to BizRadio – As I’ve said – Something smells Frishy

  1. Winsome Wit says:

    Chuck, Please reach out to the DFFS clients to get their accounts checked. The Chief Trader that was doing all the trading for Daniel (Carl Somebody) is attempting to quickly open up his own RIA firm. I suspect they are getting into the same crappy portfolios he traded for Daniel, or he is now in cahoot with DFFS in someway. We now have seen 13 of DFFS clients come across our desks with some of the worst stock, bonds and private equity positions, from a suitability standpoint we have seen in some time. Now, to be fair to this “kid” trader that Daniel supposedly reared from High School –their characterization, not mine– we have had two of the 13 DFFS clients tell us Daniel is claiming in calls to them that “Carl is responsible for these horrible choices”. Cahoots, perhaps not, but someone should ask about that situation as well. Regardless, this Carl would have known as much about all the mess as Kaleta if he had all this responsibility, or was in a regulated position.

  2. Jim says:

    Winsome Wit –

    Please email me at xxxxxxxxxx

    • Winsome Wit says:

      Jim,

      Looks like you were blocked by Chuck. Seems a lot of that is going around. Folks have been put in muzzles like Ron Crider who used to have an entire blow-by-blow on his blog at http://www.roncrider.com and it was taken down.

      • To all who have responded. I have blocked no one. I did remove Jim’s email address as most folks do not wish to have it displayed in public. Jim if you wish for your email to be displayed…please respond and provide it. I will approve your response. My guess (note it is only a guess) is that the SEC is doing investigations of their own and that any folks involved are expected to remain silent. My advice…do not invest until the smoke clears and either BizRadio and/or Frishberg is cleared of any wrongdoing or found that it is a scam or sham. My best to all investors and as significant info crosses my desk I’ll do my best to post in the interest of transparency.

  3. […] unfortunatly for the investors the implosion continues… On February 19, 2010 I posted a blog that asked a number of questions related to BizRadio and Daniel Frishberg.  Not long after a reply […]

  4. JimVAT says:

    No problem Chuck or Witsomewit,

    I am neither an investor with DFFS nor have any skin in this game. I have merely been a listener of Bizradio for 8 years now.

    I have learned so much listening to the station and reading on my own that it is just a shame at how this is turning out. I really think the radio business just got away from Frishberg. That and he was not entirely an honest person nor hired competent people.

    Regardless, we will see how this plays out.

    Jim

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