According to the sheet, $136 was spent for elevator work, $80 for pest control and zero for "maintenance." More than $9,300 was spent on mortgage payments. About $2,200 went for overhead fees: "management," "legal," "sales" and "wages and commissions." With utility costs, the result was a net loss of $949.
Writing Off Losses
Innocent investors write their losses off on their income taxes. And, because the slum trader may have defaulted on a note held by one of his own companies, he is probably in a position to write his "loss" off as well.
For the Record
Los Angeles Times Tuesday August 1, 1989 Home Edition Part 1 Page 2 Column 6 Metro Desk 2 inches; 62 words Type of Material: Correction
Alexander Spitzer--The Times reported incorrectly Monday that Inglewood lender Alexander Spitzer controls several industrial loan companies. The appropriate term for Spitzer's firms is not industrial loan companies, but finance companies. Finance companies, or "hard-money lenders," are less regulated than thrift and loans, which take deposits from the public in the form of investment certificates. Both are licensed by the state.
There is nothing illegal about creating one new company after another.
"There's nothing wrong with creating 100 new companies or 1,000 new companies," said Jim Reber, spokesman for the state Franchise Tax Board. "That's perfectly legal. But if you don't file tax forms, they will be suspended."
Many of Leyton's companies are suspended for failing to file state income tax returns, the public record shows.
Numerous Leyton-related corporations have filed for bankruptcy. In an apparent violation of bankruptcy regulations, records show, Leyton failed to disclose to the court on more than one occasion that he held a major interest in several companies that previously filed for bankruptcy.
Flash in the Pan
One such corporation, PHC Finance Inc., was extremely short-lived.
According to state records, PHC Finance was incorporated on Jan. 24, 1985. According to federal bankruptcy records, however, it "duly held and convened" a meeting of its board of directors on Jan. 23, 1985--the day before it came into existence. On that day, it decided to declare bankruptcy.
That means it went bankrupt before it was created.
On Jan. 25, it filed for bankruptcy, listing about $250,000 in debts on an apartment building. Its president, the busy Grover Black, listed as his "principal place of business" 1800 S. Robertson Blvd., Suite 384.
The "suite" is a rented post office box in a convenience store.