Councilman's Lawsuit Alleges $1.9M Dollar Theft
Submitted by Allen Gwinn on Wed, 10/28/2009 - 06:00.
Update 9/17/09: Several developments in the Neumann lawsuit. First, on the criminal side, Shannon DeMerse was indicted for felony theft in the first degree. If convicted she could face up to life in prison. Demerse is out on $50,000 bond pending trial.
It is our understanding that there were some developments in the Ellis County case last week. We will check later this week to give the court time to assemble all the documents.
DEVELOPING
Last February, on the dawn of his re-election campaign, Dallas City Councilman Dave Neumann filed a lawsuit against a former employee, two banks and an accounting firm over a massive alleged theft from the business owned by Neumann and his wife.
The lawsuit, quietly filed in Ellis County, accuses an 18-year employee, Shannon DeMerse, of pilfering $1.9 million dollars from his apparel boutique, Ivy Jane, over a 1 1/2 year period.
"As of the filing of this Petition, it appears that [DeMerse] has stolen $1.9M from Ivy Jane," says an amendment to the original Ellis County lawsuit.
Neumann's business, F L Malik, Inc. (dba Ivy Jane) grosses $2.6 million dollars annually according to Hoovers. If correct, the alleged theft would represent approximately 73% of the annual income to the business.
According to a confession made by DeMerse, filed as an exhibit with the lawsuit, she started taking the money around "mid 2007." "My family has been in financial trouble since Stuart has been out of work," says the handwritten document in part.
In excerpts from a deposition taken on February 10, 2009, DeMerse details how she opened bank accounts using the name "Ivey Jane, Inc" and funneled money from Neumann's business to a variety of destinations.
According to DeMerse, some of the money went to finance Darling Dolls of America and Diamonds and Pearls--beauty pageant businesses focusing on kids.
DeMerse also admitted to stealing Ivy Jane customers' credit card numbers.
Demerse was asked if she used "any credit card numbers belonging to actual customers of F.L. Malik without authority to pay some of these accounts?"
"Yes," DeMerse replied. According to DeMerse, she used "three or four" in January of 2009.
Records also show that DeMerse has contributed to Neumann's city council campaign in the past.
Many questions about the lawsuit remain unanswered and, according to a protective order filed in the case, Neumann may be trying to keep as many of the details as secret as possible.
One big question: how did Neumann and his wife, listed as officers of F L Malik (Ivy Jane), fail to notice something as significant as a $1.9 million dollar theft from a $2.6 million dollar business?
Neumann has also named Compass Bank and Citibank in his lawsuit. The suit accuses both banks of negligence in allowing DeMerse to deposit Ivy Jane's money into her own accounts.
Neumann is also suing his accounting firm, Philip Vogel & Company, accusing them of failing to uncover the theft.
Criminal charges have not yet been filed against DeMerse.
Neumann has been unavailable for comment.
DEVELOPING
Dave Neumann / Shannon Demerse
What is the latest with this case?
Thanks...
[Ed Note: Her criminal case is set to go to trial in early September. We'll be there!]
I see the civil case is over
I see the civil case is over and Shannon Demerse has a $2.8 million dollar judgment against her...yikes!
[Ed Note: Yes, big surprise here, eh? The biggie is going to be the criminal trial.]
civil judgment against Shannon
I am going to take a big, safe leap here and say...she does not have an extra $2.8 million lying around. So, if he can't get any money from her what happens?
[Ed Note: I think this is the least of her worries. She has a criminal trial coming up that may well put her away for a few years. As far as the civil judgment, it's nothing that a good bankruptcy can't cure!]
Wait a minute, how did it
Wait a minute, how did it go from 1.9 mil to 2.8 mil?? Wow
[Ed Note: When you don't contest it in court, it doesn't matter what it is.]
still how did Neumann and
still how did Neumann and his wife fail to notice they're losing money that big?
[Ed Note: That is the $1.9 million dollar question!]
You mosey body pageant
You mosey body pageant freaks need to get your own lives and stop being so consumed with others lives....move on and go back to the pink boards
What is a mosey body pageant
What is a mosey body pageant? He is my councilman and he employee'd her for a long time. Just wondering how she could have gotten away with it for soooo long and how could he not know and what would stop her from using the money she stole to fund her defense. And wasn't the Shannon woman running one of these kiddy pageants,,,now talk about freak!!!! What the heck is a pink board?????
Demerse Trial
Ok why does it take so long to put this to trial? For goodness sake she is up on thief charges for stealing 1.9 mil. Lets say if she did do it, what has stopped her from using the $$ she stole to fund her lawyer/defense team? Or move the money around so it can't be found? She must be smart to get away with it for as long as she did. Just wondering... Or is someone watching to check her finances?
Councilman's Lawsuit Alleges $1.9M Dollar Theft
Any new developements on this case that you know about? Are you still following this? It seems very interesting but haven't heard anything in a while. Just wondering.
[Ed Note: Yes, there is another announcement set in the criminal case for early April. We'll let you know when it is set for trial.]
Shannon Demerse
Do you have any new information about this case? You had said you were sifting through the paperwork. Are you done yet? Thanks
[Ed Note: Picking up where I left off right now. Thanks for the boot in the ... ]
Update?
Any update on this case?? Just wondering, this is pretty big dollar amount. I hear that Neumann is getting a divorce, wondering if there is a connection? Sure alot of activity in the councilmans life, hope it doesn't keep him from doing his city hall duties to the people of Dallas??? Any update would be interesting. Thanks!
Friday 2/19/10 appears to be
Friday 2/19/10 appears to be a court date for the criminal case...
[Ed Note: Yes, it's an announcement date. Court for her is probably months out.]
announcement date
What is an announcement date?
[Ed Note: Here is a great description of the entire criminal law experience.]
shannon demerse and dave neumann
When might we see an update on this case?
Thanks.
[Ed Note: Just worked on that today. I have quite a bit of material--probably too much to put up online. But I hope to have an update shortly. I need to find out how a motion for summary judgment worked out.]
shannon demerse and dave neumann
I am sure this will sound like a broken record, but....is there going to be an update this week?
Dying to "read all about it".
thanks.
[Ed Note: I'm sure this will sound like a broken CD (record is so ... well ... our generation isn't it!) but I'm recovering from surgery. I have quite a bit of stuff to sift through. Do you think putting up the motion for summary judgment raw would be a start?]
summary judgment - Absolutely!
Absolutely!!
That will give us something to gnaw on for a while....we just want to see a little bit of what has been going on for the last several months.
Sorry to hear about your surgery. :-(
Hope you get well soon! :-)
Thanks.
Dave Neumann statement about divorce
I saw on DallasNews.com (cityhallblog) that he made a statement about going through a divorce.
Was there any statement about the lawsuit that he is a victim of?
She Runs A Business?
I don't understand something. How can someone that is in such trouble and has nothing open a new business? She now has her own screen print business and advertises it on facebook. Can she legally do that?
[Ed Note: Her own screen print business? Can you send me some more details?
How do you know it is her business?
What is the name of the business?
It is not a secret that we
It is not a secret that we loose a huge pie of budget pie because of thefts, bribes, etc. We can't cope with it without transparent judges, and all the research papers that we are writing here can wake public opinion to provide us with "clean" government!!!
shannon is really sweet she
shannon is really sweet she was just trying to keep her kids alive
[Ed Note: Well, this is an interesting theory, tell me more!]
Sweet???
What does sweet have to do with anything? You would think she would have thought about her children before she committed the crime. Are you trying to say that Ms. Demerse committed these crimes to assist or help her children? Are they sick? I know medical cost can make prople crazy but is that the case here? I just trying to understand your comment about about she was just trying to keep her kids alive????
Keep her kids alive...
What in the world is that suppose to mean...there is nothing wrong with her kids...and there is no excuse for what she did, period!
Woah! That's a big theft
Woah! That's a big theft case. I've been following the reports progress on this.
Update
So is there any update on this case? Ya know I bet the Civil suit will just be a slap on the wrist and Newmann will get nothing back. More than likely she will be placed on probation for the criminal, so in some way's crime does pay.....It's just not right!
[Ed Note: We're looking into it right now.]
It will all come out in the criminal trial
I am sure all Dave's dirty little secrets will come out in the criminal trial. I am anxious to hear all that. I would venture to guess that he has some illegal items in his background too.
Criminal Charges
Just how long does it take to file Criminal charges in Dallas county? You would think Craig Watkins would be all over this just for coverage (you know he loves the camera). Didn't this break back in Febuary?
It appears that she has been arrested...
According to dallascounty.org, online public records, charges have been filed against her...is this true are you not keep up with this case any longer?
[Ed Note: Yes, she has been charged with first-degree felony theft and is out on $50,000 bond. We'll get something up. I wanted to go down and look at the file.]
Updates?
Do you have any new info on this case? We sure would like to know what has been happening!
[Ed Note: Our chief reporter has been sick with the flu. He'll get to it next week. He says he hates being a one-man shop :) ]
UPDATES?
What is the latest on this case?
thanks!
UPDATES on the Dave Neumann/Shannon Demerse issue?
Are you not following this case anymore? We have not seen an update in severeal weeks....Last update said you were going to go back to the court after they had the rest of the week to get caught up.
Just wonderin'.....
Thanks for any info you might have.
[Ed Note: We're in the process of getting more information right now.]
Have you been told not to writing anything?
We have not had any update since 10/28....just curious! Thanks!!
[Ed Note: Absolutely not. As a matter of fact, I'm trying to read through a rather voluminous stack of filings. Sorry it's taking so long.]
Goody!
Sorry about always asking....just curious about an update. Watch out...don't get any paper cuts going through all that paperwork!!
Get Well Soon!
Dear Chief Reporter,
Sorry you are sick with the flu!
Hope it is not the swine flu!...If it is, one good swim through the mud in the pig pen should clear you right up!!
Seriously, take care of your self. Hope you get to feeling better soon.
Sincerely,
A concerned reader
[Ed Note: Most people call me "you swine" from time to time, so it would stand to reason that I'd have the swine flu! I'll let everybody know if it is.]
Anyone got an update?
Does anyone have any news about this case?
(asking everyone....in case you are still sick, Mr. Editor.)
by the way..hope you are better now.
Neumann
That doesn't make any since, if Mr. Neumann had something illegal in his background or something to hide do you actually think he would have filed a suit against this women in the first place...and don't you think someone would have uncovered something about him by now since he is an elected official?
I believe that theft is the
I believe that theft is the worst that can only come up with! I think that people need to earn a living by honest labor!
Trial
I understand there is a trial date set for this morning. Sounds like progress?
[Ed Note: Updates coming...]
anonymous
Is anyone aware that Shannon Demerse has a post on the Texas Pageant board www.voy.com/13909/2/ stating that "the company is not completely innocent in this" Check it out interesting.... plus theres lots more She posted it on 8/29/09
Oh I'm sure everyone
Oh I'm sure everyone involved is aware of that post and from an attorneys stand point she just dug her grave and needs to crawl in it...
Are you not following this case anymore?
I hear there have been some updates, are you not following this case anymore?
[Ed Note: What have you heard?]
any updates?
Anyone going to the court in September? October?
[Ed Note: Heh, maybe me!]
So...nothing happened at court in September?
No judgements or anything??
[Ed Note: No, it was pretty boring.]
September 16th court date
Will you be attending?
[Ed Note: Don't know yet. I'll have somebody there though.]
Updates
Awesome!! Please be sure to update us often through out the day! Hourly would be great! Just kidding...every two hours then? :)
Some of us just can not be there, even though we would like too.
[Ed Note: Will try...]
Criminal Charges
I have also heard that the Dallas County DA is handling the criminal case and is preparing to take it before a grand jury...
New Court Date and Amended Lawsuit
I hear she violated the TRO and has to appear in court on September 16th to show cause and that they amended the lawsuit from $1.9 million embezzled to $2.6 million embezzled....is this true?
[Ed Note: I'll check it out!]
I think I have smelled this before
In my years of free-lancing for fashion fools, I witnessed several companies that could not be anything other than money laundering devices.
I know this sounds out of the box, but this is the truth. I was employed by a company of Chinese nationals that had the most messed up system ever. It was against all laws of nature that a company like that could survive. Seriously, they are still in business after two decades, and I am so confused... I cannot go into details.. but there is not any other possible reason for this company to continue.
I know there is another one, who was "owned" by a lady/wife of a diet pill pushing MD husband. Again, just not reasonable they could have survived even the short few years they did.
I was approached by a company a few weeks after 9/11 who wanted my skills. They were really odd too. At a time when all business screeched to a halt, this guy was busting guns??? He wanted a jack of all skills, yes I am, but he was offering a pultrie salary. I said well if the volume is small and it is a part time job, ok, but I will watch how their profits and volume increase, then we will renegotiate. I explained that I am an honorable person, and that I have expectations of that from him. Needless to say....end of interview... I think it was a scam to funnel money to Pakistan....just my insight and judgement from years of experience..
Given the current pay to play city hall business dealings coming to light...hmmm seems consistant...
Looks like the ex-employee is trying to make money
It would appear that the ex-employee is trying to make money by selling her two pageants, hopefully to pay back Mr. Neumann but I don't know what pageant or pageants are worth 1.9 million...www.voy.com/13909/
That is the oldest trick in the book
In my career, I have been witness to embezzelment, as well as I called out a "partner" in the non-profit I was president of, and, I know about the apparel manufacturing business. In the 1980's the Bank of America had associates run this type of scam on several Los Angeles Manufacturers with large and active accounts. This was long before personal computers, and the methods used are calculating and easy to hide. The trick is to have the debits and credits offset by not having the debits clear, so the balance seems there, when infact it is being skimmed. It is even easier when the business factors the invoices, that means, they sell the notes for instant cash, and the factor waits out the 30 days or what the terms are. There are chargbacks and 8% off and all sorts of credits to add to the confusion, and if there are many debits, it will never be accurate until the audit is complete, and then the truth is apparent.
That is how the folks get cheated.
I had a friend that hired an accountant that told the payers to pay to his name, then he packed up his belongings and shipped it on her UPS account, and she never knew it, because it happened in just a few weeks time. She was informed by a store, that knew her well enough to wonder who was that person, because this gal did not need to factor, and this was indeed strange. I also was a bit leary of this guy, but I did not say anything, but I should have; 20/20 hindsight.
FACT = ADDICTS WILL DO STRANGE THINGS! So chill the judgements. I think it is a matter of personal forgivness these people are being true to their heart and you cannot tell what is going on, and until you have seen the world, you may think you are smart, but then, some one will bite your butt... ouch..
My question is, WHY Ellis County? Is it because the Dallas DA is such a jerk?
Also Why hold the bank accountable? Interesting.. I had the experience when that time I had the non profit the gal had the account in her Father's Bank. When she did her scam, I went to the bank and withdrew the funds and they were more than cooperative.. I guess it was not outside of the box to them. She had the incorporation documents, and the bank gave me a copy and I went to compass and re-established, but of course I was listed as president, so there was not question. Her lawyer called me, and wanted to negotiate, and I explained about the money she pocketed, and said, I think you call that embezzel.... he never called again...hmmm go figure.
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