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February 8, 2023

Egad, Pharma Bro Martin Shkreli Was an Insufferable Client

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Everyone who works in public accounting experiences a bad client or two. But then again, there are bad clients, and then there are the Martin Shkrelis of the world. It’s really a disservice to the bad clients out there to lump Martin Shkreli in with them.

This CNBC report details the testimony of Corey Massella, who was a partner at Citrin Cooperman, the firm helping Shkreli’s company, Retrophin, get ready to go public. Shkreli is currently on trial for securities charges. According to Massella, Shkreli’s business is the stuff clients from hell are made of. Highlights include:

  • Retrophin’s accounting described as “very chaotic.”
  • Shkreli repeatedly sending “changes in the stock ownership tables,” that caused an exasperated Massella to write “WTF?” in an email.
  • Shkreli getting testy over Citrin Cooperman’s questions about contractors and their requests for Retrophin’s agreements with them.
  • Numerous head-scratching debit card transactions for “iTunes, Starbucks and travel expenses.”
  • Compensation payments to Shkreli that didn’t run through payroll, including “a $575,000 transfer from Retrophin to Shkreli’s personal bank account” that was explained as “back pay and ‘bonus pay.'”

Then there’s this doozy:

[A] year after beginning work for Retrophin, Massella said, his accounting firm flagged a $4,130 expense to Retrophin paid to the Borgata hotel in Atlantic City, New Jersey.

When Shkreli was asked about it, Massella said, he replied, “Martin’s trip to Atlantic City.”

When the accountants asked Shkreli the purpose of the trip, he replied, ‘No business, Shkreli to refund to company,’ ” Massella said.

The final straw for Citrin Cooperman wasn’t another brazen transaction or ambiguous justification, but seems to be Shkreli’s sister’s email decorum:

Joel Cooperman, managing partner at Citrin Cooperman, in his email resigning the firm’s work for Retrophin, blasted Shklreli’s sister for her “outrageous and rude” email to one accountant, according to testimony Monday.

Of all the indignities that accountants have to suffer, you’d think dealing with rude emails would be pretty small potatoes. Although it does make for a fine capstone to putting up with a bunch of shady behavior.

[CNBC]

Correction: An earlier version of this post erroneously stated that Citrin Cooperman was the auditor of Retrophin.

Image: Wikimedia Commons

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