The largest consumer bankruptcy firm in Illinois which is also one of the largest in America has filed for protection from its debtors under the bankruptcy laws. The Semrad Law Firm which markets itself under the name Debtstopers has filed a Chapter 11 Bankruptcy in Delaware back in April.
Patrick Semrad, one of the firm’s owners, has said that the reason for the bankruptcy was that pandemic relief programs hurt the firm’s revenues. Eviction moratoriums, mortgage forbearance, and not needing to make student loan payments stopped millions of Americans from filing a bankruptcy during the period.
Records show that the firm received $3.8M in PPP Loans during the period. It also shows that the Semrad Brothers transferred the majority of their clerical work during the pandemic to a company they own in Bulgaria.
Records further show that Robert Semrad, Patrick’s brother and an owner of the firm, was convicted in 2015 on a Domestic Battery charge in Lake County. Mr. Semrad was also convicted of a DUI charge in 2012 which led to a 90 day suspension of his law license.
The bankruptcy filing also includes the following details.
1 – $199,609 was spent by the firm on luxury vehicles for a partner.
2 – $1.47M was paid to one of the partners for, “card transactions and loans.”
3 – A personal loan in the amount of $525K was made to one of the partners during the pandemic.
Let me leave you with this.
One of the concepts that accountants test is what we call the Tone At The Top. It comes down to the fact that the most successful type of leadership entrepreneurs can display is Leadership by Example.
In my short career we’ve had all sorts of leadership concepts that were promoted by everyone from MBA Programs to Leadership Gurus trying to sell books. But setting a good example has always been the best way to run an organization.
How can we possibly ask our employees to do anything that we don’t actually do ourselves?
Effective Leaders by definition are always the best employees. At that point we have the right to correct our employees when they don’t follow the rules or give us 110%.
The previous example is one where the owners didn’t provide a good example. One owner was a lawyer that broke several laws and actually got convicted.
When times got tough, the owners were given plenty of money to keep going but instead decided to move jobs overseas. They also rewarded themselves with luxury vehicles, huge reimbursements, and even loans. How would they possibly be able to retain or even hire a hard working, loyal workforce while exhibiting these types of behaviors?
The Tone At The Top is something we measure in audits. If the tone is good and management is exhibiting the right types of behavior, then we can assume that their employees will be held accountable exhibiting the same types of conduct and demeanor. But if it isn’t good, we usually assume the opposite.
When the Tone At The Top is bad, we normally see everything from absenteeism and a poor work ethic to embezzlement and a lack of profit. Please think about this the next time you say something like, “Do as I say, not do as I do.”
We’re all going to get through this. Let’s get through it together.
As an inducement, we’re offering 33% off your first six months of bookkeeping and / or the first three months of electronic payroll services on a complimentary basis. In order to claim this benefit, please click on the appropriate button below and provide your contact information. We’d love to help.
Accounting Solutions Ltd. stands ready to complete our mission and purpose of protecting you, your family, and your business. Whether you need Employee Retention Credits, M&A Due Diligence, Payroll Services, or Accounting and Tax Work, you have but to ask. I’m here and I remain,
Sincerely yours,
Chris Amundson
President
Accounting Solutions Ltd.
773-267-7500
888-310-0300
www.SalarySolutions.net
www.AccountingSolutionsLtd.com
Note that the only professional services provided by Accounting Solutions Ltd. are those specified in a written communication from our office detailing the scope of services to be rendered and the terms and conditions applicable to the engagement.