White-collar fraud fighters believe there may be more than 55 "boiler room" operations in San Diego County. Most simply "cold call" potential investors gleaned from "lead sheets" purchased from various mailing list companies and from other sources. A handful of boiler rooms have been closed here in the past two years, including two in the past three weeks.
The problem has become so pervasive that authorities have organized a San Diego Boiler Room Task Force, composed of investigators representing the U.S. attorney, district attorney, FBI, state attorney general, the U.S. Postal Service, the San Diego Police and Sheriff's departments and the Commodity Futures Trading Commission.
The task force will be formally announced next week, according to law enforcement sources, who say San Diego is "certainly one of the central locations in the United States for boiler room activity."
App Resigns as Capital Bank Director
John App, Capital Bank of Carlsbad director, has resigned as a result of the brouhaha surrounding the current proxy fight at Capital Bank's parent holding company, Crown Bancorp.
App, president of Corporate Pension Funding in Laguna Niguel, said Monday that his directorship "ceased being fun."
There are "too many lawsuits flying around," App said, noting that Coronado-based Crown, like many other financial institutions, no longer carries directors and officers liability insurance.
"The first six months were enjoyable, (and) I guess I hung on because I thought I could help clear it up. But new management never consulted directors . . . If the present management continues on the board, it may be a clean bank, but I don't believe it will be a profitable bank."
Crown President Mike Justice said he was unaware of App's resignation, but he said that App had not yet returned his proxy to Crown for its Aug. 1 annual meeting.
Meanwhile, La Jolla real estate investor and Crown shareholder Michael Saywitz on Monday claimed that he has "received overwhelming support" from fellow shareholders for his $20-million suit alleging breach of fiduciary duty by Crown executives.
Included among the list of supporters, Saywitz said, is Sam Souvall, chairman of Valley Utah Bancorporation, a $900 million bank holding company.
For its part, Crown on Friday sent a letter to shareholders explaining that current management isn't responsible for the company's $2.5 million loss last year. Chairman Phillip Akre blamed the loss on prior management.
A Nassco Trolley?
National Steel & Shipbuilding, paddling fast to lure new business and slow its months-long work force cutback, is exploring new avenues of work that could include bidding on an eastern extension of the San Diego Trolley.
Nassco is "looking at other areas where our expertise could be used," according to Fred Hallett, vice president of finance and corporate relations.
The new work could include the Trolley, said Hallett, as well building steel for buildings, bridges or roads.
The giant shipyard's work force has been trimmed to 3,800--down from 4,600 in May--and could tumble to 1,000 if no new contracts are secured by year's end.
Meanwhile, the drug-sniffing dogs that last month began searching the bayfront facility will now make twice-a-week unannounced visits, Hallett said. The dogs have yet to find any contraband, however.
A Rush Job
The process of merging one operation into a larger one can often be taxing. Just ask the folks at Intermark, where San Diego's Rush Press was merged into Intermark's U.S. Press earlier this year.
Recently, operations manager Don Smith, production manager Ben Michael and two salesmen who reportedly generated $1.5 million a year in sales have left.
A Fit Place for People
Stephen Haines has made sweeping changes since joining Imperial Corp. of America last year as executive vice president and chief administrative officer, eliminating some divisions and generating profits to replace last year's red ink. (President Ken Thygerson used to work with Haines at the Federal Home Loan Mortgage Corp.)
Haines will impart his how-to formula in an, er, intriguingly titled speech Wednesday to the local Personnel Management Assn. "How to Use Guerrilla Warfare to Develop a Humanistic Organization That is a Fit Place for Human Beings to Thrive."
Filling the Void
Hoping to capture some of the market abandoned by bankrupt Imperial Airlines in Carlsbad and defunct Pacific Coast Airlines in Santa Barbara, American Eagle of San Luis Obispo begins San Diego service today.
The commuter airline will commence service to Los Angeles, Santa Barbara, San Luis Obispo and connections to 10 other California cities. The company is operated by Wings West Airlines and has become fully integrated into American Airlines' route system.