Frederick “Rick” McMenimen III, an Exeter, Massachusetts, businessman and a founder of The Rinks at Exeter, has recently filed Chapter 7 bankruptcy, owing $563,192.87 to his creditors and theInternal Revenue Service having an attachment on his property.
McMenimen is also being sued by Susan Wagstaff, a former family friend, for mismanagement of $900,000 in funds. She alleges that McMenimen “abused his position as her financial adviser, using her funds to benefit himself”.
According to the suit, which was filed in Rockingham Superior Court, McMenimen helped Wagstaff set up an irrevocable life insurance trust for the benefit of her three children. At that time, according to the suit, McMenimen worked for Guardian, John Hancock, Prudential Insurance and Custom Financial. The suit also states that, for the last several years, McMenimen worked at a Prudential Insurance-related company, Pruco Securities.
From an article by Aaron Sanborn on www.seacoastonline.com, Wagstaff had received a “significant inheritance” and had shortly thereafter invested in life insurance annuities through McMenimen. He then reportedly informed Wagstaff that she could get a larger return if she made some bigger investments. According to the lawsuit, some of Wagstaff’s larger investments went toPSB, which Wagstaff believed was Prudential Savings and Bond as well as to Custom Financial. The suit states that Wagstaff subsequently discovered that PSB did not stand for Prudential Savings and Bond, but rather a company owned by McMenimen, known as Slapshot Sports.
The suit also alleges that “All of the checks that [Wagstaff] had written to PSB totaling $900,000 did not go into financial investments as she expected, but instead were used for the personal purposes (of McMenimen).” In November, the FBI told her that they were conducting a serious investigation of … Rick McMenimen.”
According to the newspaper story, McMenimen and his attorney, in their response to the suit, deny Wagstaff’s allegations and claim that she did not invest in PSB or Custom Financial.
Wagstaff was recently issued an attachment on McMenimen’s property.
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