Thomas Joseph Petters of Petters Company
Media Releases
On September 29, 2008, Tom Petters resigned as chairman and chief executive of Petters Group Worldwide and its affiliates in the wake of a federal criminal investigation into allegations of massive investor fraud. He released a statement through his attorney and has previously denied any wrongdoing. His resignation became effective immediately.
On September 26, 2008, the FBI announced it had records of Tom Petters repeatedly admitting to defrauding investors. A federal search warrant alleged that Petters and others showed investors fake documents to convince them to provide money to the financially stressed company. The FBI, IRS and federal agents raided the Petters Group headquarters and Tom Petters’ home on Wednesday, September 24, 2008. They were looking for evidence of a scheme to lure investors into funding a company based on tens of millions of dollars in purchases and sales that never occurred. The FBI announced that they had a woman who came forward with documents and information and later wore a wire and recorded several conversations involving Petters and others who carried out the fraud. The affidavit alleges Petters is caught on tape repeatedly admitting to the fraud scheme and alledgedly talks about fleeing the country if the scheme was discovered. Mr. Petters is also said to have admitted to cheating on his taxes on the tapes. The total fraud on investors is estimated to be over $2 billion dollars.
In July of 2008, Petters Group had acquired the Metropolitan Media Group. After acquiring the company, Petters Group Worldwide stated that 50 to 60 employees of Metropolitan would not get thousands of dollars in back pay and accrued vacation money. They later rehired 38 people and paid them retention bonuses.
In 2008, Petters Group Worldwide and Thomas Petters controlled about three-quarters of Enable Holdings (formerly uBid.com).
In 2007, The College of Saint Benedict (CSB) received a $5.3 million commitment from Tom Petters, founder, chairman and CEO of Petters Group Worldwide for the creation of the Thomas J. Petters Center for Global Education. Tom Petters, a St. Cloud native, was a member of the CSB Board of Trustees.
An April 2006 article announces that MN Airlines, which operates primarily through passenger carrier Sun Country Airlines, has agreed to be acquired by the Minnesota based Petters Group Worldwide.
A February 2006 article announces Thomas J. Petters has committed $4 million to Miami University’s Campaign for Love and Honor to benefit the Richard T. Farmer School of Business, in honor of his daughter Jennifer Petters.
An August 2005 article reveals that Petters Group had abandoned Polaroid’s digital imaging technology and laid off most of its once-vaunted research and development staff.
A May 2005 article reveals that while Polaroid’s chairman and CEO received millions of dollars in bonuses after Petters Group Worldwide’s acquisition, Polaroid’s nearly 6,000 retirees are receiving $47 checks: One-time payments from a trust fund to compensate them for failed legal efforts to reinstate insurance benefits lost when their company filed for bankruptcy in 2001.
An April 2005 article announces the close of Petters Consumers Brands acquisition of Polaroid Holding Co. after Polaroid stockholders voted to approve the deal.
An April of 2005 article announces Thomas Petters, has been inducted into the Miami University Academy of Entrepreneurs at the Thomas C. Page Center for Entrepreneurship.
An August of 2004 article reveals that Federal regulators scrutinized the accounting practices of Fleming Cos. Inc. who acted as a middleman for $50 million in sales between Petters Co. and Redtag. Both are divisions of the Petters Group Worldwide, a collection of companies run by Thomas J. Petters. Fleming’s retail accounting directors were suspicious of the Redtag and Petters diverting transactions and raised their concerns with executives, sources said. Some of the transactions involved hundreds of 60-inch high- definition televisions, which are not easy to fit into warehouses bulging with food and general merchandise.
In March of 2004, Thomas Petters’ son, John Petters was killed while vacationing in Florence, Italy. John Petters was a student at Miami University (OH) at the time. Petters, 21, and a female friend apparently followed a woman into a private park and were confronted by the woman’s father. The father thought that Petters was a thief and yelled at him in Italian, a language Petters didn’t understand. The father has been arrested for allegedly stabbing Petters to death. In 2005, the man was convicted and sentenced to 3 years in prison for manslaughter.
A September of 2004 article reports that in memory of his slain son, Thomas Petters donated $10 million to the Miami University School of Business.
A February 2003 article announces that Thomas Petters will pledges $3 Million to the College of Saint Benedict in honor of his parents.
A March 2001 article announces RedtagBiz, Inc.’s acquisition of CrossMarket Corporation, owner of CrossMarket.com, Thomas J Peters, founder of Redtag comments on the benefits for consumers and both companies.
An article from October of 1998 announces, discount retail entrepreneur Tom Petters, founder of the 11-store Petters Warehouse Direct Inc. chain, is getting into the Internet commerce business and forming a new company Tom’s Cyber Warehouse Inc. by trying to raise $3.75 million in start-up capital through private stock offerings.
A media article reveals that Tom Petters reportedly paid $150 million from his own pocket, and $426 million total, to buy the Polaroid Company, and the name recognition that comes with it.
