American Capital Holdings

601 Seafarer Circle

Suite 402

Jupiter, FL 33477-9053

561.429.8704 Telephone (Office)

561.452.0127 Cellular (BAR)

561.352.6876 Cellular (Rick)

barneyarichmond@msn.com

rturner@achusa.com

October 5, 2009 

Via United States PostalCertified                                                                                                

Mail No. 70071490000054486599 

RETURN RECEIPT REQUESTED 

 

Mr. Thomas B. Andres, CPA, Fuoco Group 

f/k/a Wieseneck & Andres & Company, P.A. 772 H.S. Highway One

Suite 200

North Palm Beach, FL 33408-3549 

 

Re:      Wieseneck, Andres & Company, P.A.

            & Thomas B. Andres, CPA

            Public Company Accounting Oversight Board

            PCAOB Release No. 105-2008-001

            PCAOB Release No. 104-2005-117A

 

Dear Tom:

 

In opening, we strongly suggest you carefully review the contents of this correspondence andsupporting exhibits as it is very important to both of our respective companies’ future.  I willbegin by making reference to our July 21, 2009 12:00 p.m. lunch meeting at the La BambaMexican Restaurant on U.S. Highway No. 1 coupled with your discussions with Rick Turnerover the last several weeks.  The purpose of this letter is to clarify our relationship/position,which unfortunately, is now centered around the above referenced Public CompanyAccounting Oversight Board (“PCAOB”) Release No. 105-2008-001 dated April 22, 2008.As you know, the PCAOB is a division of the United States Securities & ExchangeCommission (“SEC”).  Reference is also again hereby made to PCAOB Release No. 104-2005-117A dated October 27, 2005.  We were aware of the first PCAOB 104-2005-117Release, in which we responded with a January 2, 2008 letter directly to the Mr. Mark Olsenwho is the Chairman of the PCAOB.  We did not see the PCAOB 105-2008-001 Releaseuntil three (3) weeks ago, which I obtained on the internet via the PCAOB website.  For yourconvenience, we attached copies of both of these PCAOB Releases as Composite ExhibitNo. 1.

Since our above described aforementioned lunch meeting, Rick and I have constantlydiscussed our “can’t win” dilemma regarding your conduct.  Additionally, we also want toaddress the declarations you made during this July 21, 2009 lunch meeting as well as someother prior remarks.  Accordingly, after your review of this correspondence and the attachedexhibits, it clearly illustrates you have put us into an impossible situation by your wrongfuldecision to stipulate to the actions set forth in the above described and enclosed April 22,2008 PCAOB Release.  As you are well aware, the aforementioned PCAOB documentsresulted in a “PCAOB Order Instituting Disciplinary Proceedings, Making Findings,And Imposing Sanctions”against you and Wieseneck, Andres & Company, P.A.  You andthe PCAOB bi-laterally agreed (without even telling us) to this Order in spite of our verystrong prior written and oral objections.  We will begin by again re-advising you we havealways disagreed with your decisions with respect to the way you handled the PCAOBissues.  Needless to say, your allowing this PCAOB Order to be entered against you and yourfirm has cost us almost five (5) years of hard work and has caused millions of dollars inmonetary damages to our companies. 

By way of background, we are providing, as outlined below, a chronological sequence of theoccurred events (coupled with exhibits supporting) with respect to our entire businessrelationship, which absolutely illustrates we are the ones who have been victimized by yourimproper judgment to stipulate to something to which you should have not.  Withoutreservation, the facts clearly illustrate, your decision to stipulate to the PCAOB sanctions,have put us, not only us individually, but all of the eleven (11) public companies in anextremely impossible difficult position, which problems are further articulated below.Additionally, from the tone of your recent conversations, it seems you are more interested inyour receivable monies outstanding than the interests’ of your client(s) being able toovercome the situation to which you and your firm caused.  You clarified your position byyour statement in our above described July 21, 2009 lunch meeting when you stated -- *“*I amworried about Tom” (i.e. yourself).  You said the same thing to Rick and I when we metearlier one prior afternoon when we sat outside at Carmines’ La Trattoria on May 29, 2009. Iwill begin by re-stating the following facts, which are fully supported by the many exhibitsappended herein.

1.         When American Capital Holdings, Inc. (“ACH”) entered into the SpauldingVentures, LLC Agreement, ACH was a private company.  In order to keep the namethe same, on December 19, 2003 USA Sportsnet Company filed Articles ofAmendment with the State of Florida Division of Corporations changing its namefrom USA SportsNet Company to American Capital Holdings, Inc.  AmericanCapital Holdings, Inc. filed a name change simultaneously changing it’s name fromAmerican Capital Holdings, Inc. to ACHI, Inc.  USA Sportsnet was a subsidiary ofeComeCom.com, Inc. (“eCom”).  eCom already was a client of your firm.

2.         One of the requirements of closing the Spaulding Ventures, LLC (“Spaulding”)transaction was ACH required “an independent outside audit” of Spaulding by alicensed auditor to be conducted in accordance with Generally Accepted AccountingPrinciples (“GAAP”)”.  As you know, this audit was conducted by Mr. TimothyFoster, CPA.  Spaulding’s agreement with ACH was to transfer ACH common sharesto each Spaulding member’s based on their respective investment.  Each member’srespective investment was based on their *actual audited documented cost basis.*Thiswas attested via Mr. Foster’s January 13, 2004 Audit Report for the period endingDecember 31, 2003, which was titled “Management Report Valuation &Company Profiles”.   A copy of Mr. Foster’s above described  report is appendedherein as Exhibit No. 2.

3.         In addition to Mr. Foster’s audit, ACH required each and every Spaulding member tosign a Release document, which stated exactly the following language as outlinedbelow. 

*“Upon delivery to you of (“ACHI Shares”) in connection with the Exchange (i) you, foryourself, your spouse and heirs, and for each of your affiliated, parent and subsidiarycorporations, partnerships, limited liability companies, businesses (whether or notincorporated) and other related entities (collectively, your “Affiliated Parties”), release,quitclaim, and forever discharge American Capital Holdings, Inc. and American CapitalHoldings, Inc.’s officers, directors, managers, and all shareholders principals, owners,successors, assigns, agents, attorneys, insurers, reinsurers, employees, former officers andformer members, of American Capital Holdings, Inc. or its manager, and all other relatedand affiliated parties thereof, from any and all claims and causes of action, including,without limitation, any claims or causes of action (A) arising under or in connection withSpaulding’s or @CapResource, Inc. articles of organization, operating agreement, anysubscription for interests in Spaulding or @CapResource, Inc. debt or its business orinvestments, (B) relating to or in connection with the Spaulding Units or @CapResource,Inc., your acquisition, purchase, ownership, disposition or sale of the Spaulding Units or@CapResource, Inc. debt, the Manager’s operation of Spaulding and @CapResource, Inc.and conduct of its affairs (including any claims or causes of action under any federal or statelaws or regulations governing the issuance, sale or other disposition of securities), and (C)relating to or in connection with the Exchange. By accepting the (“ACHI Shares) you, foryourself, your spouse and heirs, and for each of your affiliated, parent and subsidiarycorporations, partnerships, limited liability companies, businesses (whether or notincorporated) and other related entities (collectively, your “Affiliated Parties”), release,quitclaim, and forever hold harmless American Capital Holdings, Inc. and American CapitalHoldings, Inc.’s officers, directors, managers, and all shareholders principals, owners,successors, assigns, agents, attorneys, insurers, reinsurers, employees, former officers andformer members, of American Capital Holdings, Inc. or its manager, and all other relatedand affiliated parties thereof, from any and all claims and causes of action, including,without limitation, any claims or causes of action (A) arising under or in connection withSpaulding’s or @CapResource, Inc. articles of organization, operating agreement, anysubscription for interests in Spaulding  and @CapResource, Inc. debt or its business orinvestments, (B) relating to or in connection with the Spaulding Units or @CapResource,Inc. debt, your acquisition, purchase, ownership, disposition or sale of the Spaulding Unitsor @CapResource, Inc. debt, the Manager’s operation of Spaulding or @CapResource, Inc.and conduct of its affairs (including any claims or causes of action under any federal or statelaws or regulations governing the issuance, sale or other disposition of securities), and (C)relating to or in connection with the Exchange.*

*The Exchange of your member interest is based on the dollar amount invested into a memberunit in Spaulding Ventures LLC. or @CapResource, Inc. debt,*

*Example: The value of one member unit or debt is fifty two thousand five hundred dollars($52,500.00) divided by five dollars per share in American Capital Holdings, Inc commonstock. Each Unit Member will receive ten thousand five hundred shares of common stock inAmerican Capital Holdings, Inc. In addition each member unit holder will receive warrantsin American Capital Holdings based on two thousand five hundred (2,500) warrants perevery fifty two thousand five hundred ($52,500.00) dollars invested. All warrants areexcisable at six ($6.00) dollars and with a trading price of five ($5.00) dollars per share orabove.*

*This letter and the legal relations among the parties hereto shall be governed by andconstrued in accordance with the internal laws of the State of Florida without regard toconflict of law principles.  If you are in agreement with the foregoing, please execute thisletter where indicated below and return the original executed copy to Spaulding.  I haveenclosed a duplicate original of this letter for your records.”*

                                                            SPAULDING VENTURES LLC

                                                     By:  @CapResource Inc., its manager

 

                                                            By: __________________________

                                                                  Robert C. Logel, President

 

ACCEPTED AND AGREED

 

this _______ day of ________, 2003

 

 

                                                                

Name: (The Spaulding Member’s Name)

 

Please note the fact we received One Hundred (100%) percent approval(including theaforementioned executed Release Agreements) from all the outstanding Spaulding Ventures,LLC members.  This release document fully covered you as our agent. Along with TimFoster’s audit, these signed documents served as additional confirmation and verification tothe exchange offer agreement.  As defined in paragraph four (4) below, your audit indicatesyou already have a copy of this agreement.  As you are aware and pursuant to your belowdescribed auditing ending February 29, 2004, all the Spaulding members becameshareholders of American Capital Holdings, Inc.  The above referenced respective releaseswere consideration and an absolute condition of ACH’s exchange offer. 

 

4.         On May 24, 2004, ACH submitted/filed a Form 10SB12G with the United StatesSecurities & Exchange Commission (herein after referred to as the “SEC”).  ThisForm 10SB12G included a nine (9) month ACH audit by your firm for the periodending February 29, 2004.  The SEC made no comments about this filing and it wasruled*“effective**by law”,*on July 28, 2004.   It seems to us the SEC examiners shouldhave raised questions regarding your audit in this Form 10SB12G filing.Notwithstanding, they did not.  

 

5.         On November 29, 2004, an Involuntary Petition was filed against eCom eCom.com,Inc.  by petitioning creditors, American Capital Holdings, Inc., Richard C. Turner andBarney A. Richmond. 

 

6.         On January 11, 2005, American Capital Holdings, Inc. filed an Amended Form10SB12G with the SEC.  This Amended Form 10SB12 included your audit datedNovember 10, 2004, which was for the period ending May 31, 2004.  This Form10SB12G was already ruled*“effective by law”* and was only an amendment.  Therewere no comments from the SEC examiners regarding your audit with respect to thisamendment filing.

 

7.         On May 16, 2005, an Order was entered in the United States Southern District ofFlorida Bankruptcy Court in re: eCom eCom.com, Inc. (Case No. 04-3539-BKC-SHF) by the Honorable Judge Stephen H. Friedman adjudicating eCom eCom.com,Inc. as a Chapter 11 Debtor.

 

8.         On June 6, 2005, an Order was entered in the United States Southern District ofFlorida Bankruptcy Court in re: eCom eCom.com, Inc. (Case No. 04.3539-BKC-SHF) appointing Barney A. Richmond as the Chief Executive Officer of the Debtor,eCom eCom.com, Inc.  Richard C. Turner was appointed Chief Financial Officer.We also received an Order for the use of electronic service to eCom’s websiteregarding notice for each and every court motions, claims and other pleadings etc.You were mailed a copy of this Order regarding electronic service via the UnitedStates Postal Service by the court required mail service appointee, Automatic DataProcessing, Inc. (“ADP”).  We had three (3) of these type of certificate of servicemailings each costing in excess of Five Thousand ($5,000) each.

 

9.         Attached asExhibit No. 3, is a copy of an August 15, 2005 seventeen (17) page legalanalysis written by me (Barney A. Richmond) to Mr. John Reynolds, AssistantDirector of the United States Securities & Exchange Commission as to why, in thecontext of the aforementioned bankruptcy proceedings and in accordance with §1105& 1106 of the United States Bankruptcy Code, I had Richard Turner (the at the timeacting CEO of the Debtor eCom) issue the eight (8) subsidiary spin off companiesshares to the shareholders of record of eCom.   This legal analysis was requested bythe SEC as a response to the recently filed Form 10SB12G Registration Statements Iinstructed Rick to file with the SEC.  You were sent a copy of this letter and youknew of the Form 10SB12G Registration Statements as you conducted the audits ofeach of the spin off former subsidiaries.  The result of my correspondence was allthese subsidiaries companies became part of the eCom’s bankruptcy proceedings assuggested in my legal opinion to the SEC.  These companies were listed is eCom’sDisclosure Statement as the “Subsidiary Companies”, which are described inparagraph sixteen (16) below.  

 

10.       During the period from June 6, 2005 through March 20, 2006 (as you know and inorder to protect your interests), we were constantly requesting that Kluger, Peretz,Kaplan & Berlin, P.A. file an application to get your accounting firm approved by theUnited States Southern District of Florida Bankruptcy Court.  

 

11.       On March 20, 2006, a 2:00 p.m. hearing was held in West Palm Beach, FL in front ofJudge Stephen H. Friedman regarding a motion our attorneys filed on your behalfwhich titled “EX-PARTE MOTION FOR RECONSIDERATION OF ORDERDISAPPROVING EMPLOYMENT OF DEBTOR’S AUDITORS NUNC PROTUNC TO NOVEMBER 29, 2004 AND FOR ENTRY OF AN ORDERAPPROVING RETENTION OF AUDITORS”.   You personally attended thishearing.  A copy of the March 20, 2006 court transcript of this hearing confirmingthis fact is affixed herein asExhibit No. 4.

 

12.       On March 28, 2006 an Order was entered titled “ORDER GRANTING DEBTOR-IN-POSSESSION’S EX-PARTE MOTION FOR RECONSIDERATION OF ORDERDISAPPROVING EMPLOYMENT OF DEBTOR’S AUDITORS NUNC PROTUNC TO NOVEMBER 29, 2004 AND FOR ENTRY OF AN ORDERAPPROVING RETENTION OF AUDITORS.   The result of the March 20, 2006hearing was you and your firm were approved by the Bankruptcy Court.  A copy ofthis Order is enclosed asExhibit No. 5.

 

13.       On August 18, 2006, a Joint Plan of Reorganization was filed by the Debtor, eComeCom.com, Inc. and Joint Plan Proponent American Capital Holdings, Inc.  A copy ofthis Joint Plan of Reorganization can be viewed at “ecomecom.net” under the title“Bankruptcy News” by double clicking the “read more” title on the August 18, 2006date. 

 

14.       On August 25, 2006, a Disclosure Statement was filed by the Debtor, eComeCom.com, Inc. and Joint Plan Proponent American Capital Holdings, Inc. A copy ofthis Disclosure Statement can be viewed at ecomecom.net under the title “BankruptcyNews” by double clicking the “read more” title on the August 25, 2006 date.  A copyof this Disclosure Statement is also appended herein asComposite Exhibit No. 6.

 

15.       On December 28, 2006 an Order was entered titled “ORDER (I) APPROVINGDISCLOSURE STATEMENT*;(II) SETTING HEARING ON CONFIRMATIONOF PLAN; (III) SETTING HEARING ON FEE APPLICATIONS;(IV) SETTINGVARIOUS DEADLINES; AND (V) DESCRIBING PLAN PROPONENTS'OBLIGATIONS”.  A copy of this five (5) part Order can be viewed at ecomecom.netunder the title “Bankruptcy News” by double clicking the “read more” title on theDecember 28, 2006 date described as “ORDER (I) APPROVING DISCLOSURESTATEMENT*;(11) SETTING HEARING ON CONFIRMATION OF PLAN; (111)SETTING HEARING ON FEE APPLICATIONS; (IV) SETTING VARIOUSDEADLINES; AND (V) DESCRIBING PLAN PROPONENTS' OBLIGATIONS”.To further document and for your convenience, a true and correct copy of this Order,Disclosure Statement etc. is affixed herein asComposite Exhibit No. 7.

 

16.       On January 3, 2007, Joint Proponent, American Capital Holdings, Inc. and the Debtor,eCom eCom.com, Inc. filed the First Amended Disclosure Statement.  A copy of thisDisclosure Statement can be viewed at ecomecom.net under the title “BankruptcyNews” by double clicking the “read more” title on the January 3, 2006 date describedas First Amended Disclosure Statement.   This Disclosure Statement was extensivelyreviewed by the SEC on numerous occasions (with many comments/suggestions) andwas ultimately approved by the Court, which is further described in paragrapheighteen (18) below.  

 

            *The aforementioned approved Disclosure Statement order stated:*

 

*“Subsidiaries”* shall mean (i) USA Performance Products, Inc., (ii) eSecureSoftCompany, (iii) USAS Digital, Inc., (iv) Pro Card Corporation, (v) AAB NationalCompany, (vi) A Classified Ad, Inc., (vii) Swap and Shop.net Corp., (viii) A SuperDeal.com, Inc., and (ix) My ZipSoft, Inc., unless otherwise referred to individually inthe Plan.

 

17.       On January 3, 2007, Joint Proponent, American Capital Holdings, Inc. and the Debtor,eCom eCom.com, Inc. filed the First Amended Joint Plan of Reorganization (“ThePlan”).  A copy of this Plan can be viewed at ecomecom.net under the title“Bankruptcy News” by double clicking the “read more” title on the January 3, 2006date described as First Amended Joint Plan of Reorganization. 

 

*Section 11.04 of the Reorganization Plan Stated:*

 

11.04   Exculpation.

 

“Subject to the occurrence of the Effective Date, neither the Debtor, the ReorganizedDebtor, ACH as Plan co-proponent, nor any of their respective members, officers, directors,agents, *financial advisors (meaning you and your firm)*, attorneys, employees, *equity holders**(which included the former Spaulding members who were now ACH shareholders)*, partners,affiliates and representatives (the “Exculpated Parties”) shall have or incur any liability toany holder of a Claim or Equity Interest for any act or omission in connection with, relatedto, or arising out of, the Case, the Plan, the pursuit of confirmation of the Plan, theconsummation of the Plan or the administration of the Plan or the property to be distributedunder the Plan;  *provided*, that the foregoing shall not operate as a waiver or release for (i)any express contractual obligation owing by any such Person, (ii) willful misconduct or grossnegligence, and (iii) with respect to Professionals, liability arising from claims ofprofessional negligence which shall be governed by the standard of care otherwise applicableto professional negligence claims under applicable non-bankruptcy law,**and, in all respects,the Exculpated Parties shall be entitled to rely upon the advice of counsel with respect totheir duties and responsibilities under the Plan; *provided further* that nothing in the Planshall, or shall be deemed to, release the Exculpated Parties, or exculpate the ExculpatedParties with respect to, their respective obligations or covenants arising pursuant to the Plan;*provided further*that the foregoing shall not operate as a waiver or release of Claims bygovernmental entities arising under environmental laws.”

11.05   Releases

“On the Effective Date, the Debtor, the Reorganized Debtor, and any and all Holders ofClaims and Equity Interests shall release unconditionally and are hereby deemed to releaseunconditionally each of the Debtor, ACH and their post-petition directors and officers, and*Professionals**{including you and your firm}*(collectively, the “Released Parties”) from anyand all claims, obligations, suits, judgments, damages, losses, rights, remedies, causes ofaction, charges, costs, debts, indebtedness, or liabilities whatsoever, whether known orunknown, foreseen or unforeseen, existing or hereafter arising, in law, equity or otherwise,based in whole or in part upon any act or omission, transaction, event or other occurrencetaking place between the Petition Date and the Effective Date, which is in any way relatingto the Debtor, this Case, any assets or Property of the Estate, the business or operations of theDebtor, the DIP Financing, any Plan Documents, the Plan, or any of the transactionscontemplated thereby; provided, however, that this release provision shall not be applicableto any liability found by a court of competent jurisdiction to have resulted from fraud or thewillful misconduct or gross negligence of any such party.  With respect to Professionals, theforegoing exclusion from this release provision shall also include claims of professionalnegligence arising from the services provided by such Professionals during the Case.  Anysuch claims shall be governed by the standard of care otherwise applicable to the standard ofnegligence claims outside of bankruptcy.  The Confirmation Order shall enjoin theprosecution by any Person or entity, whether directly, derivatively or otherwise, of any suchclaim, obligation, suit, judgment, damage, loss, right, remedy, cause of action, charge, cost,debt, indebtedness, or liability which arose or accrued during such period or was or couldhave been asserted against any of the Released Parties, except as otherwise provided in thePlan or in the Confirmation Order.  Each of the Released Parties shall have the right toindependently seek enforcement of this release provision.  This release provision is anintegral part of the Plan and is essential to its implementation.”  

 

11.06   Injunction Relating to Exculpation

“The Confirmation Order will contain an injunction, effective on the Effective Date,permanently enjoining the commencement or prosecution by the Debtor, the ReorganizedDebtor and any other Person, whether derivatively or otherwise, of any action or causes ofaction against any party exculpated, released or discharged pursuant to this Plan.”

 

18.       Enclosed as Exhibit No. 8is a copy of the March 12, 2007 Court Transcriptregarding the Joint Plan of Reorganization and Disclosure Statement as described inparagraphs 16 & 17 above.Appearances were made in court by: (i) Mr. Michael D.Seese, Esq., for and on behalf of the Debtor, eCom eCom.com, Inc., (ii) Mr. MarkFisher, Esq. for and on behalf of American Capital Holdings, Inc.; (iii) Ms. DenyseHeffner, Esq. for an on behalf of the Department of Justice U.S. Trustee’s office; and(iv) Mr. Gordon Robinson, Chief Bankruptcy Counsel, for the United StatesSecurities & Exchange Commission (“SEC”).  As you are aware, the PublicCompany Accounting Oversight Board (“PCAOB”) is an accounting enforcementand review division of the SEC.  If you review Mr. Robinson’s and Ms. Heffner’sstatements, they gave us accolades for what we had accomplished.  As you are wellaware, I had to fight with the Kluger Peretz Kaplan & Berlin (“KPKB”) on just aboutevery motion, including your fee approval.  My relationship got so bad with KPKBthat I had to bring in Schiff Hardin, LLP out of Chicago as I refused to talk to theKPKB people anymore.  In the court transcript, when Mr. Robinson stated “he wassurprised that Mr. Seese’s (KPKB) firm was not taking stock” in lieu of their fees, hewas kind of needling Mr. Seese as the SEC came out in support of my August 15,2005 legal analysis. The result of this March 12, 2007 Confirmation hearing wasJudge Friedman approved Co-Plan Proponent American Capital Holdings, Inc. and eComeCom’s Plan of Reorganization, which included releases for American CapitalHoldings, Inc., eCom and all of the subsidiary companies as outlined in paragraphsixteen (16) above.  The bottom line is the SEC came out publicly in support of us,which, according to many securities and bankruptcy attorneys, is extremely very rare.Usually, the SEC will state through pleadings if they do or do not have objections.  Ifyou had not concealed your October 27, 2005 PCAOB problem to us (which wefound out in December 2007), we would have handled this right through thebankruptcy process as we ultimately had the blessing of the SEC SoutheasternEnforcement Division in Atlanta, GA to which where Mr. Robinson is located.   Youwere also aware, ACH had also hired Mr. Michael Wolinsky, Esq. of Schiff Hardin,LLP to represent ACH, when we were having problems with KPKB.  Mr. Wolinskywas the former head of the SEC Southeastern Enforcement Division for fifteen (15)years and he actually hired Mr. Robinson many years ago.  We worked very closelywith Mr. Robinson for over a year.  I highly suggest you re-read this transcript as itwill show you that you really screwed up keeping your problems hidden and later byrefusing to listen to us.

 

19.       Affixed herein asExhibit No. 9is a copy the March 23, 2007 Court Order approvingthe above referenced Joint Plan of Reorganization and Releases.  Please take note ofthe fact we received One Hundred (100%) percent approval from all the shareholders(which were “impaired” under the Plan/Ballots and were required to vote on thereleases) including American Capital Holdings, Inc. shareholders as well as fromshareholders of all subsidiaries described in paragraph sixteen (1) above.   

 

Upon confirmation of the Plan, American Capital Holdings, Inc. shareholders became thecontrolling shareholders of the Debtor, eCom eCom.com, Inc., which ACH shareholders,officers, directors and professionals were basically released twice.  One was ACH as a PlanProponent.  The other was ACH as a shareholder of eCom.  With respect to the formerSpaulding Ventures, LLC members, ACH, its officers, directors and professionals (includingyou and your firm) have received General Releases three (3) different times.  

 

20.       Enclosed herewith asExhibit No. 10 is a copy the September 12, 2007 OrderApproving First And Final Application Of Wieseneck & Andres, P.A. as auditors forthe DEBTOR-IN-POSSESSION FOR AN ALLOWANCE OF COMPENSATIONOF FEES AND REIMBURSEMENT OF OUT-OF-POCKET EXPENSES FOR THEPERIOD JANUARY 30, 2006 THROUGH AND INCLUDING JANUARY 16, 2007{CP-#328}.

 

21.       Reference is hereby made again to Richard C. Turner’s and my aforementionedJanuary 2, 2008 United States Postal Certified Mail Letter No.70022410000543376468 to Mr. Mark W. Olsen, Chairman and Ms. AngelaDesmond, Chief of Staff of the Public Company Accounting Oversight Board.Pursuant to your request, Richard Turner and I wrote this letter to clarify our position.In this letter, we advised we depended on the audit performed by Timothy Foster,CPA and booked the entry exactly per his audit.  We also reminded the PCAOB thatMr. Turner and I had signed off under the criminal penalties of perjury.  A copy ofthis correspondence is enclosed herein asExhibit No. 11.  This letter had eleven (11)exhibits which supported our position.  The PCAOB wrote back and advised they didnot think they wanted to meet with us and they (the PCAOB) did not have any issueswith American Capital Holdings, Inc.  You were copied with this letter and its eleven(11) exhibits, as you used it and the book we made of the exhibits for your recentDepartment of Professional Regulation hearing a couple of months ago.  Rick and Italked to you on the phone several times to help you prepare for your hearing.   

 

22.       Enclosed asExhibit No. 12. is the March 28, 2008 ORDER FOR FINAL DECREEsigned by the Honorable Judge Paul G. Heyman, Jr. regarding Pro-Plan Proponent,American Capital Holdings, Inc., Debtor eCom eCom.com, Inc. and all of the aboveand below described former spin off subsidiaries of eCom.   

 

23.       Reference is again hereby made to the PCAOB Release No. 105-2008-001 datedApril 22, 2008, which is again appended herein as Exhibit No. 1. In order todistinguish the PCAOB paragraph numbers from my numbers listed in thiscorrespondence, I have inserted a “P” in front of the PCAOB number paragraphs.Paragraph two (2) on page one (1) of this PCAOB Order stated the following:

 

*“The Board deems it necessary and appropriate, for the protection ofinvestors and to further the public interest in the preparation of informative,fair, and independent audit reports, that disciplinary proceedings be, andhereby are, instituted pursuant to Section 105(c) of the Sarbanes -Oxley Act of2002 (“Act:) and PCAOB Rule 5200(a)(1) against Wieseneck & Andres &Company, P.A. (The “Firm” or “Wieseneck, Andres”) and Thomas B.Andres, CPA (“Andres”) (collectively.  “Respondents”).*

 

*            *Paragraph one (1) under Title II advises the following: 

 

*“In anticipation of institution of these proceedings, and pursuant to PCAOB Rule5205, Respondents have each submitted an“Offer of Settlement”("Offers") thatthe Board has determined to accept. Solely for purposes of these proceedings andany other proceedings brought by or on behalf of the Board, or to which the Boardis a party, and without admitting or denying the findings herein, except as tothe Board's jurisdiction over them and the subject matter of these proceedings,which is admitted, Respondents consent to entry of this Order InstitutingDisciplinary Proceedings, Making Findings, and Imposing Sanctions ("Order") asset forth below”.*

 

Title III of this PCAOB Release states:

 

                                                                       III.

*“On the basis of Respondents' Offers and information obtained by the Board inthis matter, the Board finds2 that:*

A.       Respondents

 

*1.       *“*Wieseneck, Andres & Company, P.A. is an accounting firmincorporated in the state of Florida and is licensed under the laws ofthe state of Florida (Florida Board of Accountancy License No.AD0016885).   Wieseneck, Andres is registered with the Boardpursuant to Section 102 of the Act and PCAOB Rules.   Its office islocated in North Palm Beach, Florida.*

 

*2.         Andres, 64, of North Palm Beach, Florida, is a certified public accountantlicensed under the laws of the state of Florida (License No. AC0006827).He is the Firms "Audit Principal" and, at all times relevant to thismatter, was an associated person of the Firm, as that term is defined inSection 2(a)(9) of the Act and PCAOB Rule 1001 (p)(I).*

----

 

 

*2*The findings herein are made pursuant to the Respondents' Offers and are not binding onany other person or entity in this or any other proceeding. The sanctions that the Board is imposing onRespondents in this Order may be imposed only if a Respondent's conduct meets one of the conditionsset out in Section 105(c)(5) of the Act, 15 U.S.C. § 7215(c)(5). The Board finds that Respondents'conduct described in this Order meets the condition set out in Section 105(c)(5)(A), which provides thatsuch sanctions may be imposed in the event of "intentional or knowing conduct, including recklessconduct, that results in a violation of the applicable statutory, regulatory, or professional standard."

B.       Summary

 

*P-3.*    *“This matter involves violations of the Board's auditing standards.   In particular, inauditing the FY 2004 financial statements of American Capital Holdings, Inc. ("ACHI"),Respondents failed to perform, or reasonably ensure the performance of sufficient auditprocedures to evaluate the existence and valuation of recorded goodwill, marketablesecurities, and intangible assets - totaling more than 97% of ACHI's reportedassets - and to evaluate ACHI's determination not to consolidate the financialstatements of an entity in which it disclosed having a 90% interest.    In addition,in auditing ACHI's  FY 2005 financial  statements,   Respondents failed  toidentify or appropriately  address  departures  from  Generally  AcceptedAccounting   Principles ("GAAP") relating to (1) recording the correction of anerror in one period without recording it in the period in which the error occurredand (2) the misclassification of the value of certain declared dividends as an asset.3”*

C.       Respondents Violated PCAOB Auditing Standards in Auditing the 2004 and2005 Financial Statements of American Capital Holdings, Inc.

 

*P-4*.    “*In connection with the preparation or issuance of an audit report, PCAOB rulesrequire that a registered public accounting firm and its associated persons comply withthe Board's auditing standards.-   Under the Board's auditing standards, an auditor**may express an unqualified opinion on an issuer's financial statements only when the**auditor has formed such an opinion on the basis of an audit performed in accordancewith PCAOB standards.-' Among other things, those standards require that an auditorexercise due professional care, exercise professional skepticism, and obtain sufficientcompetent evidence to afford a reasonable basis for an opinion regarding the financialstatements.2' In connection with the audits of the financial statements of ACHI for FY2004 and FY 2005, Respondents failed to do so, as described in more detail below.”*

----

 

 

             3/ An auditor's opinion that an issuer's financial statements are presented in conformity with GAAP must bebased on an audit performed in accordance with PCAOB standards. PCAOB standards require an auditor toperform audit procedures sufficient to evaluate the issuer's adherence to GAAP. This Order's description ofaudit failures relating to GAAP departures in an issuer's financial statements necessarily reflects the Board'sjudgment concerning the proper application of GAAP. Any such description of GAAP departures, however,should not be understood as an indication that the Securities and Exchange Commission has considered ormade any determination concerning the issuer's compliance with GAAP.”

 

             4/See PCAOB Rules 3100, 3200T.

 

Under the PCAOB’s title2004 Auditand Goodwillparagraphs P-7 - P-9 stated the following:

 

2004 Audit

*P-6.*    *“The Firm was engaged as ACHI's independent auditor in June 2004. TheFirm issued an audit report dated November 10, 2004, that was included in ACHI'sForm 10-KSB filed with the Commission on February 1, 2005 and ACHI's Form 10-KSB/As filed with the Commission on April 29, 2005 and September 15, 2005.   In theaudit report, the Firm expressed an unqualified audit opinion on ACHI's consolidatedfinancial statements for FY 2004.   The report stated that ACHI's financial statementspresented fairly, in all material respects, ACHI's financial position, results of operations,and cash flows in conformity with GAAP.   In addition, the report stated that the auditwas conducted in accordance with the auditing standards of the Public CompanyAccounting Oversight Board.    Andres was the engagement partner who had finalresponsibility for the audit**.”*Goodwill

 

*P-7.     ACHI's FY 2004 financial statements reported goodwill of $8.21 million as of May 31,2004, representing approximately 57% of ACHI's reported assets. According to ACHIdisclosures, $7.2 million of this reported goodwill was acquired as part of aFebruary 29, 2004 transaction in which ACHI "acquired [various specifiedassets],goodwill of $7.2 million and assumed $1,005,000 in debt for the issuance of [commonstock]. "z/*

 

*P-8.     Those  ACHI   disclosures  strongly  suggested  the  possibility  that the transaction described byACHI involved a "business combination" for GAAP purposes.-' Under the circumstances, thespecific nature of the transaction was significant because of its bearing on theappropriateness of ACHI recognizing the "acquired" goodwill and its bearing on theadequacy of ACHI's disclosures.-   Respondents understood that the $7.2 million ingoodwill that ACHI disclosed as having acquired in the transaction was goodwillthat   had   previously   been   recorded   as   goodwill   by   the   other  entity.Respondents,   however,   failed   to   evaluate   the   nature   of   the   transaction,  theappropriateness   of recognizing   the   acquired   goodwill, or the adequacy of thedisclosures.—'*

*P-9.*     *In addition, Respondents failed in a separate and distinct way to perform sufficientprocedures as to all of ACHI's reported goodwill.   Specifically, Respondents'procedures to test the existence and valuation of goodwill were limited toobtaining representations from management.   Those representations alone were notsufficient audit evidence,—' and Respondents failed to perform any other proceduresto test the existence and valuation of goodwill.—'*

 

Paragraph P-10 “Titled Investments”& Paragraph 11 Titled “Intangible Assets”of thePCAOB Order stated the following:

 Investments

*P-10.  “ACHI's FY 2004 financial statements reported "marketable securities" valued at $2.96million as of May 31, 2004, representing approximately 20% of ACHI'sreported assets.  ACHI disclosed that over 90% of the value of thesemarketable securities related to "equity ownership positions" in tendevelopment stage companies that had no quoted market price and in whichACHI had no controlling interest.— Respondents reviewed a brokeragestatement obtained from management with respect to approximately 10% of thestated total marketable securities balance, but they failed to perform any otherprocedures to test the existence and valuation of the reported marketablesecurities.—7 Respondents also failed to evaluate management's determinationnot to recognize an impairment loss on the stated marketable securitiesbalance.—“*

Intangible Assets

*P-11*.  *            ACHI's FY 2004 financial statements reported intangible assets of $2.96million as of May 31, 2004, representing approximately 20% of ACHI's reportedassets. ACHI described 99% of these reported intangible assets as "intellectualproperty rights" and reported that they were acquired in connection withACHI's acquisition of a 90% interest in another entity.—' Respondents failed toperform procedures to test either the existence or valuation of these reported"intellectual property rights."—7*

 

Paragraph P-12 Titled “Consolidation”and Pargraphs 13 & 14 Titled“2005 Audit” stated thefollowing.

Consolidation

*P-12.               As described above, ACHI reported in April 2005 that it had obtained a90% interest in another entity. ACHI, however, did not consolidate that entity'sfinancial results into ACHI's FY 2004 financial statements. Respondentsunderstood that ACHI had obtained this interest at the time of the November10, 2004 audit report, but failed to evaluate ACHI's  determinationconcerning whether to  consolidate that entity's financial results.—'*

2005 Audit

 

*P-13.               The Firm issued an audit report dated August 26, 2005, that was included inACHI's Form 10-KSB filed with the Commission on August 30, 2005.   In theaudit report, the Firmexpressed an unqualified audit opinion on ACHI'sfinancial statements for the fiscal year ended May 31, 2005.    The reportstated that ACHI's financial statements presented fairly, in all materialrespects, ACHI's financial position, results of operations, and cash flows inconformity with GAAP.  In addition, the report stated that the audit wasconducted in accordance with the auditing standards of the Public**Company Accounting Oversight Board.   Andres was the engagement partnerwho had final responsibility for the audit.*

 

*P-14.*               *In its audit of ACHI's FY 2005 financial statements, Respondents failed toidentify and appropriately address two separate departures from GAAP.  First,although ACHI substantially reduced its marketable securities and goodwill asof the May 31, 2005 balance sheet date to $81,000 and,$980,000,respectively,— ACHI incorrectly**classified as assets*—7 Respondents failed toindetify and address this departure from GAAP.

 

Under Title V, the PCAOB issued and you and your firm on April 22, 2008 stipulated to thefollowing conditions.  You and your firm did this without even consulting with Richard Turneror myself.   V.

*“In view of the foregoing, and to protect the interests of investors and further thepublic interest in the preparation of informative, fair, and independent audit reports, theBoard determines it appropriate to impose the sanctions agreed to in Respondents' Offers.Accordingly, it is hereby ORDERED that:*

*A.        Pursuant to Section 105(c)(4)(A) of the Act and PCAOB Rule 5300(a)(1),Wieseneck, Andres & Company P.A.'s registration with the Board isrevoked;*

*B.        After two (2) years from the date of this Order, Wieseneck, Andres &Company  P.A.   may  reapply  for  registration  by  filing  an  applicationpursuant to PCAOB Rule 2101;*

*C.       Pursuant to Section 105(c)(4)(B) of the Act and PCAOB Rule 5300(a)(2),Thomas B. Andres is barred from being an associated person of aregistered public accounting firm, as that term is defined in Section 2(a)(9)of the Act and PCAOB Rule 1001(p)(I);*

*D.       After two (2) years from the date of this Order, Andres may file a petition, pursuantto PCAOB Rule 5302(b), for Board consent to associate with a registered publicaccounting firm.”*

 

As you know, Richard Turner and I are investors in the companies as well as officers and directors.What you and the PCAOB agreed to was not*“protecting the interests of investors”***as describedabove.  The result of your decision has totally annihilated the interests of our investors, period.Because of your unilateral wrongful decision coupled with your total flagrant disregard to yourclients’ investors’ interests’ and well being, outlined below are many more facts which illustrate thefacts to not only to support this declaration, but will show how you and your firm have put all of thecompanies on the brink of disaster.

 

24.        Footnote number seven (7) of the PCAOB’s April 22, 2008 Order stated :  

 

*“For purposes of Statement of Financial Accounting Standards ("SFAS") No. 141,Business Combinations, "a business combination occurs when an entity acquiresnet assets that constitute a business or acquires equity interests of one or moreother entities and obtains control over that entity or entities." SFAS No. 141, H 9.(This Order's references to SFAS No. 141 refer to that standard as it existed at alltimes relevant to the conduct described here, and not to the standard as revised in2007.)**If the transaction involved ACHI's acquisition of the net assets of anotherbusiness, accounting for the goodwill would be governed by SFAS No. 141, BusinessCombinations, U 38 (in a business combination, "an acquiring entity shall notrecognize the goodwill previously recorded by an acquired entity"). Alternatively, ifthe transaction involved a reverse merger (albeit an inadequately disclosed reversemerger), continued recognition of the pre-existing goodwill might have beenappropriate.”*

 

We certainly challenge the use of FASB 141 for the purpose of accounting for theacquisition of ACHI’s net assets by American Capital Holdings, Inc.   FAS 141 appliesto business’ acquired by an existing entity.  American Capital Holdings, Inc. acquireddisparate investments and assumed some of resulting liabilities that were owed byACHI.  We did not consider that the assets acquired constitute a business.  The assetswere held by an investment venture capital group.  The assets were not part of anintegrated set of activities.  The purchase of these investments was booked at the samecost as that of ACHI, which is referenced in paragraph two (2) above.  American CapitalHoldings, Inc. was relying on the audited financial statement of Spaulding InvestmentsLLC.  These assets contained an audit report issued by PCAOB registered auditorTimothy Foster of Atlanta GA.  These investments did not trade on any public marketand therefore did not have a readily available market value.  Spaulding Investments LLCaccounted for these assets at cost.  The goodwill recorded by Spaulding Investmentsreflected the premium paid by Spaulding Investments LLC for the investments held bythe predecessor of Spaulding Investments.  Without a market value for the individualinvestments, management of American Capital Holdings, Inc. chose to account for theinvestments at the same cost as accounted for by Spaulding Investments LLC audit. Atthe time the investments were acquired, management of American Capital Holdings, Inc.did not feel the goodwill was impaired as some of the investments were in an industrywhere the at market values greatly exceeded book assets. One such investment was andstill is in Smart Pill Diagnostics, Inc. (“SmartPill”).  SmartPill is a company whichdeveloped an ingestible, wireless capsule that measures pressure, pH and temperature asit transits the GI tract. This information is used to provide gastric emptying time,combined small and large bowel transit time, whole gut transit time, pressure contractionpatterns from the antrum and duodenum and motility indices. Administered in thephysician's office, the SmartPill test is completely ambulatory and the patient is free togo about their normal routine during the course of the test. As the SmartPill Capsulepasses through the GI tract, it transmits data to a SmartPill Data Receiver worn by thepatient. Once the single-use capsule has passed from the body, the patient returns theData Receiver to the Physician who then can download the collected data to a PC. ThePhysician then uses SmartPill's MotiliGI software to analyze and display the data.Within minutes, the Physician has test results in both graphical and report formats. OnJuly 22, 2009, SmartPill received an additional Twenty Million ($20,000,000)investment to support plans for continued growth and new market penetration. Thissecond round of funding was led by Oxford Bioscience Partners and Psilos Group withparticipation by Kimberly-Clark Ventures and High Peaks Venture Partners.  SmartPillhas received FDA approval for its products and now has entered the medicalmarketplace selling its products.  SmartPill’s product is believed to be superior to theGivens Imaging, Inc. (“Givens”) camera pill, due to the fact is provides measureddiagnostics where the Givens product does not.   Givens is a NASDAQ listed companywith a current market capitalization of $412,555,000.  At the time of the 2004 audit,ACH owned approximately twenty (20%) of SmartPill and ACH still has an ownershipposition in SmartPill through paid warrants.  ACH also still owns the original amounts ofmany of the companies, which were part of the Spaulding Venture, LLC. fund.  For thePCAOB to declare the “cost valuation” was not a proper initial accounting entry isbeyond being reasonable.  Secondly, the SmartPill investment and the July 22, 2008secondary private financing by Kimberly-Clark puts a private valuation alone of thecompany in excess of $250,000,000.   Third, if we did not book the entries per the audit,Rick Turner strongly believes we would have subjected ourselves to some possible IRStax violations.  

 

Additionally and most importantly, in exchange transactions, the fair values of the assetsacquired and the consideration surrendered are considered to be equal, and no gain orloss is recognized. American Capital Holdings, Inc. reflected it’s investment at the costpaid by ACHI resulting in no gain or loss to ACHI.  The total cost of the exchangetransaction is then allocated to the individual assets acquired and liabilities assumedbased on their relative fair values.  This step was not performed by American CapitalHoldings, Inc. Had American Capital Holdings, Inc. allocated the goodwill to theindividual investments then goodwill would have been reflected at zero ($0) and eachindividual investment would have been increased.  The net effect of this allocation wouldhave resulted in no change in total assets. 

 

Another very important point.  Spaulding Ventures, LLC was a venture capital fund andwas not a “business combination” as the PCAOB stated and you agreed to.  It was aninvestment, period.  The fact remains we bought Spaulding’s equity investments inseveral private companies and ACH did not then nor has ever had any interrelatedbusiness transactions with any of these companies.  A “business combination” occurswhen an entity acquires net assets that constitute a “business” or acquires equity interestof one or more other entities and obtains control over that entity or entities.” ACH did notthen nor has ever held controlling interests in the *any* of the “entities” within theSpaulding venture capital fund.  An asset purchase of stock (based on an audited costanalysis in accordance with GAAP principles – i.e. Mr. Foster’s audit---which was theagreement between the companies’) absolutely does not constitute as a “businesscombination”.   

 

25.       Regarding the Air Media Now!, Inc. securities listed in the above referenced 2004 audit,these shares were listed as the actual closing trading market price listed on the over thecounter market as of the May 31, 2004 year end date.  If we would have listed thesesecurities for less or more, Rick and I would have been in violation of the Sarbanes-Oxley penalties of perjury provisions of the Act.   We never had a chance to address thiswith the PCAOB (in spite of our January 2, 2008 written request) nor did you or yourfirm give us a chance to insert our positions in your responses to the PCOAB.   You juststipulated to the PCAOB disbarment and decided to move on without giving us the rightto due process.  Flat out, you and your firm’s handling of this situation was wrong andvery self serving.

 

26.       As you know, when ACHI merged with USA Sportsnet, Inc. and changed its name toACH. ACH has been very interconnected with all the other eCom spin off companies aswell as eCom.   ACH was the one who put monies into these companies.  As you are wellaware, ACH was the petitioning creditor of eCom, who owned all the subsidiaries.  ACHand its principals, as creditors, became the largest shareholders of eCom and all of thesubsidiaries. We, Barney A. Richmond and Richard C. Turner were appointed via a June5, 2005 United States Southern District of Florida Bankruptcy Court Order as CEO andCFO respectfully for the debtor, eCom eCom.com, Inc. 

 

27.       Reference is hereby made to Fuoco Group’s letter to me dated August 17, 2009 signed byyou on behalf of firm, which I received of August 27, 2009.  For your convenience, I amattaching a copy as Exhibit No. 13.    Your correspondence stated the following”

 

*“Dear Barney,”*

 

*“Enclosed are engagement letters for American Capital and all of the spin offsfor the year end audits at May 31, 2009 and May 31, 2009.”*

 

*“Please read one of the engagement letters.  The others are exactly the same.Keep in mind that we are currently a creditor of all of the companies and,therefore, are not independent.  Our independence will no longer be impaired assoon as we are paid”*

 

*“We will be more than willing to discuss the letter with you at your convenience.”*

 

*“Thank you.”*

 

*“Sincerely,”*

 

Thomas B. Andres

 

                                                *“Thomas B. Andres”   *

 

28.       Reference is also hereby made to the all the engagement letters enclosed with yourcorrespondence, which are dated August 11, 2009.  A copy of the American CapitalHoldings, Inc. engagement correspondence is affixed herein asExhibit No. 14.ExhibitNo. 15is a copy of the envelope whereby you sent this letter and engagement lettersthrough the United States Postal Service. Paragraph two (2) under the title “Auditedfinancial statements” states the following:

 

*“We will audit the balance sheets of the Company as of May 31, 2009 and 2008,and the related statements of operations, stockholders' equity and comprehensiveincome, and cash flows for the years then ended. The objective of an audit of thefinancial statements is to express an opinion on the financial statements inaccordance with generally accepted accounting principles accepted in the UnitedStates (GAAP). Our audit of the financial statements will be conducted inaccordance with the standards established by the Public Company AccountingOversight Board (PCAOB) and will include tests of the Company's accountingrecords and other procedures we consider necessary to enable us to express ouropinion. If our opinion is other than unqualified, we will discuss the reasons withCompany management in advance. If, for any reason, we are unable to completeour audit or are unable to form or have not formed our opinion, we may declineto issue a report as a result of this engagement.”*

 

Paragraph	two (2) on page two (2) of your August 11, 2009 engagement letter advises	the following:

 

*“We are also responsible for communicating with the audit committee aboutcertain other matters related to our audit, including (1) our audit responsibilityunder PCAOB standards; (2) information relating to our independence withrespect to the Company; (3) the Company's critical accounting policies; (4) thequality of the Company's accounting principles; (5) management's judgments andsensitive accounting estimates; (6) significant audit adjustments; (7) anydisagreements with management about matters that could be significant to theCompany's financial statements or our report; (8) any consultations managementmade with other accountants; (9) any issues discussed with management prior toretention; (10) any significant difficulties encountered in performing the audit;(11) other information in documents containing audited financial statements, suchas the Company's annual report; and (12) other matters as considered necessary.Further, we are responsible for ensuring that the audit committee receives copiesof certain written communications between us and management, includingmanagement representation letters and written communications on accounting,auditing, internal control, or other matters.*

 

Paragraph three (3) of page two (2) of this same August 11, 2009 engagement letter statesthe following:

 

*“Management is responsible for the financial statements, for making all financialrecords and related information available to us on a timely basis, and for theaccuracy and completeness of that information. Management is also responsiblefor the establishment and maintenance of adequate records; the selection andapplication of accounting principles; the safeguarding of assets; adjusting thefinancial statements to correct material misstatements; and confirming to us inthe management representation letter that the effects of any uncorrectedmisstatements aggregated by us during the current engagement and pertaining tothe latest period presented are immaterial, both individually and in theaggregate, to the financial statements taken as a whole. In addition, managementis responsible for identifying and ensuring that the Company complies withapplicable laws and regulations.”*

 

            Paragraphs one (1) and two (2) under the title “Interim Reviews” advises the following:

 *Interim**Reviews*

 

*“In conjunction with the annual audit, we will also perform reviews of theCompany's unaudited quarterly financial information for each of the threequarters in the years ending May 31, 2009 and 2008. For the first three quarters,we will perform reviews of that information before the Form 10 QSB is filed. Theobjective of a review is to provide a basis for communicating whether there areany material modifications that should be made to the interim financialinformation for it to conform with GAAP.*

 

*These reviews will be conducted in accordance with the standards of the PCAOB.A review of interim financial information consists principally of performinganalytical procedures and making inquiries of persons responsible for financialand accounting matters. It includes obtaining sufficient knowledge of theCompany's business and its internal control as it relates to the preparation ofboth annual and interim financial information to identify the types of potentialmaterial misstatements in the interim financial information and consider thelikelihood of their occurrence, and to select the inquiries and analyticalprocedures that will provide a basis for communicating whether there arematerial modifications that should be made to the interim financial informationfor it to conform with GAAP. A review is substantially less in scope than an auditconducted in accordance PCAOB standards, the objective of which is theexpression of an opinion regarding the financial statements taken as a whole.Accordingly, we will not express opinions on the interim financial information.*

 

*Management is responsible for the Company's interim financial information andfor establishing and maintaining effective internal control over financialreporting. It is also responsible for identifying and ensuring that the Companycomplies with the laws and regulations applicable to its activities; making allfinancial records and related information available to us; adjusting the interimfinancial information to correct material misstatements; and affirming that theeffects of any uncorrected misstatements pertaining to the periods under revieware immaterial, both individually and in the aggregate, to the interim financialinformation taken as a whole.”*

 

 

            Paragraph number one (1) under the title “Fees” states the following:

 

*“Our fees for these services will be at our normal billing rates which range from$250 to $110 per hour plus any out pocket expenses such as travel, reportproduction, word processing, postage, etc. Additional expenses are estimated tobe $300. A retainer of $50,000 is payable at the execution of this agreement,which will be applied to all spin off companies, and will be applied to the finalbilling. You will be billed monthly as work progresses and these billings arepayable on presentation. In addition, all outstanding professional fees for theprevious filings of Forms 10 KSB and Forms 10 QSB and any other related filingsfor all "spin-offs" must be paid prior to us beginning the May 30, 2008 and 2009audits.”*

 

            These engagement letters are signed as “The Fuoco Group, LLP”.

 

29.       Appended herein asComposite Exhibit No. 16 is a spreadsheet coupled with Wieseneck& Andres & Company, P.A.’s supporting invoices/account summaries on the followingbelow listed companies, which we received through the United States Postal Service onAugust 10, 2009.  Referenced below is a summary of your firm’s statement of amountsowed.  A copy of the envelope these invoices were sent in is enclosed as Exhibit No. 17.

 

 

 

| Company

Name                                                | Billed

Amounts

  |       InterestCharged |
|--------------------------------------------------------------|-------------------------|-----------------------------------------------------|
| American Capital Holdings , Inc.                             | $138,076.29             | $31,543.44                                          |
| A Super Deal.com, Inc.                                       | $19,545.07              | $5,757.07                                           |
| American Environmental, Inc.                                 | $17,216.88              | $4,538.45                                           |
| Click To Raffle.com, Inc.                                    | $11,653.57              | $3,358.57                                           |
| CRT Holdings, Inc.                                           | $17,113.87              | $4,948.87                                           |
| Diamond Energy Partners, Inc.                                | $13,929.46              | $3,864.46                                           |
| eCom eCom.com, Inc.                                          | $28,859.63              | $9,362.93                                           |
| I.S. Direct Agency, Inc.                                     | $4,580.49               | $1,555.49                                           |
| Green Energy Group, Inc.                                     | $13,234.45              | $3,714.45                                           |
| Core Medical Group, Inc.                                     | $21,545.43              | $4,295.43                                           |
| USA Performance Products, Inc.                               | $3,778.94               | $1,316.94                                           |
| Assurance Group, Inc.                                        | $26,810.18              | $2,955.73                                           |
|          Totals | $316,344.26             | $77,211.83                                          |

 

30.       Since the beginning of our relationship, our records indicate American Capital Holdings,Inc. has paid your firm Three Hundred Six Thousand Four Hundred Eighty FiveThousand & 76/hundreds ($306,485.76) Dollars. A copy of Richard C. Turner’sWieseneck & Andres, P.A. vendor payment detail is enclosed herein asExhibit No. 18. As you are aware, the spin off companies received their financing through ACH.   

 

            In paragraph R-1 thru R-13 below, I would now like to address many issues regarding you andyour firm’s April 22, 2008 agreement with the Public Company Accounting Oversight Board tostipulating to disbarment and to effectively agree that your accounting/auditing work wasconsidered “toxic” at best.  Outlined below are many specific problems you caused and unlessthis matter is immediately corrected, we define certain steps we may well be proceeding with.     

 

R-1.     First and foremost, as soon as you agreed to your PCAOB disbarment and admitting tofaulty audits for 2004 and 2005, you knew good and well American Capital Holdings,Inc. would be required to file an 8K Information Statement on the EDGAR system of theSEC.  Doing so one (1) year and five (5) months after the fact makes us look like foolsand this event was “a material event” as defined by securities law for all of ourcompanies.   As we said in the beginning of this letter, we kept hearing your discussionsthat you were: (i) *“working with the PCAOB”*; (ii) you advised us *“you were workingwith the Department of Professional Business Regulation”*(“DPBR”); and (iii) initially,*“there was no need to be concerned as you were merging with another PCAOB approvedaccounting firm located in Jupiter, Florida”*.  However, we did not know the extent ofyour problems. On May 29, 2009, when you advised us you were working with yourattorneys on some of these issues, you stated to Rick and I at Carmine’s LaTrotertti(i.e.Tom Andres) in Palm Beach Gardens that: *“I (i.e. you) am not worried about thePCAOB as I have that covered, I am worried about Tom’s monies and worried about theDPBR in keeping my license.”* To prove the point we met, enclosed herewith as ExhibitNo. 19is a copy of my credit card receipt. 

 

R-2.     As you are well aware, ACH, eCom and all the above described spin off companies gotour Order For Final Decrees from the United States Southern District of FloridaBankruptcy Court on March 28, 2008, which order is previously described in paragraphtwenty two (22) above and enclosed as Exhibit No. 12.  This document was received byus through the U.S. Mail on March 31, 2008.  Let the record reflect, the above describedCourt Order and General Releases were in favor of all the companies, including the spinoffs, which releases and injunctions applied to you and your firm as well.  This processtook three (3) years and five (5) months of hard work, (which in my opinion should nothave taken that long) but was beyond our control due to attorneys and our Federal Judgedid not get reappointed.  As you were fully aware, during this time period, our handswere completely tied financially with respect to all the companies until we got theBankruptcy Order For Final Decree.  However, no sooner than we got this accomplishedand without our having knowledge of what you were doing, twenty two (22) days later,April 22, 2008, you and your firm enter unilaterally into a mutually agreed stipulatedOrder granting a two (2) year PCOAB disbarment knowing good and well we hadforthcoming May 31, 2008 year end 10K’s to be filed on all the companies.  You did thiswith flagrant disregard to your clients’ rights to due process and by doing so, your firmintentionally breached your fiduciary duties to us as officers and directors as well as to allof our shareholders. More importantly, your agreement with the PCAOB has totallyembarrassed us not only with our shareholders but potential acquisition companies weare in discussions with.  They have discovered we really have nothing to offer as theywant to file secondary registrations, apply for a symbol etc, which requires theCompanies to be current with their SEC filings. 

 

R-3.     In spite of my numerous requests to go to Washington and meet with the PCAOB Boardas well as with the Chairman of the United States Securities & Exchange Commission(“SEC”), you and your firm refused our requests and went ahead accepting thisdisbarment and admitted to what is now construed as “toxic accounting” by otheraccounting firms.  Because of your admittance, stipulation and the liability exposure toany new accounting firms we bring in, these firms will not take on our companies, unlessthey can audit them from the beginning.  Do you blame them?  So ask yourself thisquestion.  What did we get for the Three Hundred Six Thousand Four Hundred EightyFive Thousand & 76/hundreds ($306,485.76) Dollars we have paid you and your firm?  Ican easily answer that question, which are: (i) a PCAOB disbarred accounting firm and aPCAOB disbarred individual; (ii) four plus (4+) years of wasted time going through thebankruptcy and restructuring processes; (iii) several million dollars worth of expensesgoing through all of this; and (iv) twelve (12) public companies to which you and yourfirm have totally put out of business. 

 

R-4.     You and your firm’s agreement to the April 22, 2008 PCAOB Order and agreement thatyour audits for 2004 and 2005 were incorrect, you put Rick and myself in a totallycompromised position *as we had signed off on these filings/audits under the criminalpenalties of perjury*.  Without reservation, we take this very seriously and you and yourfirm are the ones who are criminally liable.**Notwithstanding, you and your firm did noteven begin to think about the ramifications this has now caused us. Your decision turnedRick and I into what looks like liars, slandered our reputations as well as put ourcredibility to where the number zero would look like a great number.  We look like totalidiots.  To make things worse, when you said in our above described La Bamba July 21,2009 lunch meeting *“I am worried about Tom and what I am owed”*, absolutelyillustrated you do not give a damn about your clients or about what you have wrongfullycaused.  The bottom line is you owe us the $306,485.76 we paid to your firm (which weare hereby demanding) as your past audits are classified by other firms as “tainted”,“toxic” and “meaningless”.  

 

R-5.     When you and your firm stipulated to the above described and enclosed April 22, 2008Order for your disbarment, you and your firm did not care about your responsibility tothe 5,800 shareholders in each of these companies.  When we put out the forthcomingSEC 8K Information Statement about this situation, we are going to be bombarded withphone calls, e mails and many letters from some very angry shareholders.  To say theleast, you and your firm’s self serving decision illustrates the extreme flagrant disregardyou have for us as well as it clearly illustrates you do not care about what we now have todeal with.  After we put out these SEC 8K filings, we should consider giving your cell,home and office direct telephone numbers.  You will see first hand what avalanche ofproblems you have created. We already know about this type of hell experience wherebyin 2004 David Panaia put out an 8K statement stating the spin offs were complete whenthey were in fact not.  These shareholders wanted their shares and they wanted themNOW!!  We were literally getting hundreds of angry threatening calls per day stating“I’m calling my lawyer and SEC etc etc. etc.”  This went on for months.  That problemwas why we filed the Involuntary Petition against eCom on November 29, 2004.  In yourone single unilateral decision, you and your firm have caused us damages in the millions. 

 

R-6.     As you know, Dr. David W. Pong filed a suit against American Capital Holdings, Inc.,Richard C. Turner and myself in 2007.  Some of the allegations against us were for fraud.His attorney in California discovered your October 27, 2005 PCAOB Release and used itas a basis for part of his suit.  Ask yourself, was this our fault?  Is it right to get sued oversomeone who you had paid over Three Hundred Thousand ($300,000) to get it right.You did not even inform us about the first PCAOB Release until late 2007.  I obtainedthe October 27, 2005 PCAOB Release off of the PCAOB website in late December,2007, which lead to my above described January 2, 2008Exhibit No. 11 letter to Mr.Mark Olsen and Ms. Angela Desmond of the PCAOB, which you totally ignored.  Theresult of Dr. Pong’s California filed suit, was a hearing that lasted less than two (2)minutes, which the California Supreme Court Judge ruled in our favor over a form ofselection clause regarding Florida law venue.  Dr. Pong ultimately re-filed his case in theUnited States Southern District of Florida Federal Court.  When I responded to Dr. Pongthat we were going to file (due to the above described Court Ordered Releases, which hewas part of) a Motion For Contempt in the Bankruptcy Court against him and hisattorney, Dr. Pong, individually with the advice of his attorney, filed a Motion ToDismiss his complaint for good.  However, in spite of all of our conversations regardingthese Releases, you have chosen always to ignore them and instead, after numerousrequests, you continually refused to allow me the opportunity to address the PCAOB.  Tosay the least, you have been continually negligent as you always refuse our suggestionsand seem intent on blocking our legal rights.  It appears by the contents of the eleven (11)pages of your PCAOB agreed to Order, you were careless, unprofessional and negligentwith you and your firm’s work, which again you admitted to.  The David Pong lawsuitcost us over $150,000 in time and legal fees due to your October 27, 2005 PCAOBRelease being out there.   If we had not gotten (which we fought very hard for) the abovedescribed releases from Dr. Pong and if he (Dr. Pong) had known about the April 22,2008 Order, I can guarantee you and your firm would be fighting lawsuits not only withDr. Pong, but with many others as well.  In fact, because of your admissions after thereleases were blessed with the March 28, 2008 Order For Final Decree, Dr. Pong stillmay possibly have a cause of action against you and your firm for fraudulentlyconcealing what you had going on with the PCAOB.  

 

R-7.     Over and above the Three Hundred Six Thousand Four Hundred Eighty Five Thousand &76/hundreds ($306,485.76) Dollars we have paid you and your firm, your firm(s) havebilled the companies’ an additional Three Hundred Sixteen Thousand Three HundredForty Four & 26/Hundreds ($316,344.26) Dollars as set forth in the table in paragraphtwenty nine (29) above.  This amount includes Seventy Seven Thousand Two HundredEleven & 83/Hundreds ($77,211.83) Dollars in accrued interest.  How do you bill intereston your work, which has been,*by your own admission*, unacceptable with the PCAOB?Secondly, because of your admission and agreement to the PCAOB Order, it is ourposition your prior “toxic tainted meaningless” work is totally useless to anyone.Because of the perceived liability you have put us in, these firms will require a new auditfrom the beginning start dates of all of these companies.  To reiterate, the fact is that byACH’s accounting firm to get disbarred by the PCAOB, has now effected all thecompanies.  In other words, you prior audits are considered totally  “meaningless” tothem.  There is no way these PCAOB firms are going to put their firm at risk by trustingyour firm’s work papers on*any* of the companies.  Their common sense reasoning isbased on the fact that the PCAOB has not reviewed your work at any of our othercompanies.  The bottom line is simply these firms will not subject themselves toliabilities of an accounting firm that is disbarred.  Do you blame them?  Now ask yourselfthis question.  What good was the Six Hundred Twenty Thousand Eight Hundred Thirty& 02/Hundreds ($622,830.02) in payments and billings to your clients (i.e. us)?  Theanswer now is zero as we are required to start from the beginning.  

 

R-8.     Reference is again hereby made to paragraphs twenty seven (27) and twenty eight (28)above regarding your (Fuoco Group, LLC) August 11, 2009 engagement letters, whichyou forwarded through the United States Postal Service via your cover letter datedAugust 17, 2009.   Apparently you do not even comprehend what you agreed to via thePCAOB April 22, 2008 Order, which I am restating below again. 

 

             A.    “Pursuant to Section 105(c)(4)(A) of the Act and PCAOB Rule 5300(a)(1),Wieseneck, Andres & Company P.A.'s registration with the Board is revoked;”

 

            B.    “After two (2) years from the date of this Order, Wieseneck, Andres &Company  P.A.   may  reapply  for  registration  by  filing  an  applicationpursuant to PCAOB Rule 2101;”

 

            C.“    Pursuant to Section 105(c)(4)(B) of the Act and PCAOB Rule 5300(a)(2),Thomas B. Andres is barred from being an associated person of aregistered public accounting firm, as that term is defined in Section 2(a)(9)of the Act and PCAOB Rule 1001(p)(I);”

 

            D.       After two (2) years from the date of this Order, Andres may file a petition, pursuantto PCAOB Rule 5302(b), for Board consent to associate with a registered publicaccounting firm.”

 

                   Maybe I can make it a little more clear.  Number one, you are barred from being an associatedperson *with any registered public accounting firm*.  According to the PCAOB website, as ofSeptember 1, 2009 Fuoco Group, LLC *is not*a PCAOB approved firm nor have they appliedto the PCAOB.  Notwithstanding, your many references to the PCAOB in your letter andengagement letters asking for monies borders on extortion as well as fraudulentlymisrepresents the facts, which you sent through the United States Postal System.  What wouldyou think if the PCAOB saw your Fuoco April 17, 2009 engagement letters, which is in strictviolation of their Order?  What if the Department of Professional Business Regulation(“DPBR”) knew about this situation?  Secondly, you are over seven (7) months away beforeyou can even reapply with the PCAOB.  Third, when you asked for: (i) an additional FiftyThousand ($50,000) retainer; (ii) stated that the outstanding invoices would have to be paid orotherwise would not be construed as  “independent” is a joke.  This is especially so true due tothe fact that: (iv) you are PCAOB disbarred; (v) have been Ordered by the PCAOB that youare not allowed to be associated with a PCAOB firm; and (vi) are seeking monies for yournew firm (who is not PCAOB qualified) thorough what we believe are fraudulent meansthrough the U.S. Mail and via telephone.  

 

R-9       We would now like to address another one of your major mistakes, which cost ACH overThree Hundred Thousand ($300,000) Dollars, which was the Cosmopolitan Life InsuranceCo., Inc. audit.  This loss occurred due to your lack of controls in your audit.  You did notlook into the claims I told you to examine.  We gave you detailed claim analysis (thatmanagement was hiding), which we were tipped off by some former Cosmopolitanemployees.  In spite of what I informed you about coupled with documented facts, you gaveyour audit a clean opinion.  After reiterating the problems not only with your “clean opinion”,you put ACH’s SEC filings in jeopardy at the time.  After our pushing, you subsequentlywithdrew your opinion.  After receiving a call from one of our Board members at the time,Barry M. Goldwater, Jr., you, over our very strong objections, issued another “clean opinion”.When I informed you further about Barry Goldwater’s and our other Board Member’s(Norman E. Taplin) conflict, due to the fact they were getting paid for consulting forCosmopolitan with the State of Arkansas Department of Insurance office, your still againproclaimed your “clean opinion”.  When we re-illustrated again with clear factual backgroundregarding the claims Cosmopolitan was hiding (which were provided to you with statementsfrom the former employees coupled documented claims vouchers etc.), you subsequentlyagain withdrew your clean opinion.  By doing what we did, it protected you as there wereover a $1,000,000+ in claim liabilities that you did not catch in your audit. However, it tookyou four (4) times with my constant prodding you to get it right.  It appears you have aproblem listening and comprehending what were and are the real facts. 

 

R-10.    We have never had the opportunity to review the correspondence between you, your firm andthe PCAOB.  We have always provided you with everything you needed whenever yourequested such.  In order to try to consistently protect your interests, we alerted you toproblems such as the Cosmopolitan incidents as described above. However, you chose not tocopy us regarding any correspondence you had with the PCAOB.  Being we are the peoplewho sign off on the financial statements and SEC filings under the criminal penalties ofperjury, don’t you think it was appropriate to copy us with your’s and the PCAOBcorrespondence?  Please consider this letter as a formal demand for us to immediately receivethese documents, including your documentation with your attorneys with respect to theDepartment of Business Regulation.  I highly suggest you do not try to invoke theattorney/client privilege with respect to this request as what you have accomplished is youcaused Rick and I to perjure ourselves under our declaration under oath with the SEC.  Youowe us copies of these documents and we expect to receive them as soon as possible.  

 

R-11.    Whether you know it or not, Rick and I have not drawn a dime of salary out of thesecompanies for several years.  Rick did for two (2) years.  I never have seen a cent in salary.Sherry Cherrix is a shareholder who has spent hundreds of thousands of dollars on expensesfor and on behalf of the companies.  So has Rick and myself.  After what you and your firmhave done, we are taking the position we do not owe you or your firm anything and we herebymake demand on the $306,0000 we have paid your firm for as the results of what now isdeemed “toxic” audits, which lead to you and your firm’s PCAOB disbarment. 

 

R-12     Now straight to the point and there will be swift action on our part regarding the followingalternatives.  You have two (2) choices.  The first one is to fix what you have ruined by yourgetting Fuoco Group, LLC immediately PCAOB qualified and immediately get thesecompanies current with their required SEC filing requirements through August 31, 2009.Immediate means I want round the clock attention and it should not take you that long as therehas been very few transactions.  Rick has everything ready and Fuoco can start the worktomorrow as the preparation of the SEC filings are ready with your making a phone call toRick Turner.  Mr. Fuoco can and should fill immediately out the PCAOB application, whilethe audit work is being finished.  Rest assured, there will be no retainer and there will be noconsideration by us whatsoever for any of the outstanding balances as indicated above untilthis problem is fixed.   Attached hereto asExhibit No’s. 20 thruExhibit No. 31, of this letterare executed amended engagement letters. Due to you and your firm getting disbarred by theSEC, you are totally “independent” as we consider ourselves now as a creditor of you andyour firm.  Over the years, I have stood good for two (2) outstanding balances in excess of$89,000 *that I had absolutely nothing to do with*.  One was eCom and the other wasSyndenos Group, Inc. which later became Air Media Now, Inc.  I showed you good faithregarding those two (2) issues.  It is time for you to show some good faith towards us.

 

If you decide not to accept what is set forth to what we have requested in paragraph R-12 above, thenwe will  immediately proceed with the following:

 

1.         We plan to immediately file a complaint against you and your firm with the PCAOB officesin Washington, D.C., which will include some of the contents contained in this letter andexhibits.  I plan to fly up to Washington to request and make my case personally for anexpedited hearing in an effort to clear this matter up.   

 

2.         We plan to immediately file claims for damages against Wieseneck & Andres, P.A.’s andFuoco Group, LLC’s errors & omissions insurance carriers.  We strongly believe there is notmuch of a defense argument can be made by your insurance carrier(s) being that you havealready admitted to the many violations via the PCAOB agreed April 22, 2008 Order. 

 

3.         We will be contacting the State of Florida Department of Professional Business Regulation(“DPBR”) about bringing additional proceedings against you, your firm and Fuoco Group,LLC.  The audacity of requesting the payment of $366,344.26 plus a $50,000 Dollar retainerafter we helped (by providing some of the same information contained herein) save your Stateof Florida occupational license is absurd.  The way we see it is that you used us to get yourselfof the trouble you were in, then decide you are owed monies (with interest I might add) for“disbarred” work, which no one will touch unless they start from scratch. 

 

4.         We plan to file a Complaint For Compensatory and Punitive Damages against you, your firmas well as Fuoco Group. LLC., which will more than likely be filed in the United StatesSouthern District of Florida Federal Court.  Naturally, we will be seeking the return of the$306,000 in accounting fees the various companies have paid your firm, plus other damagesyou and your firm have cost us.  More than likely, we will seek class action for all the 5,800+shareholders who are in all the eleven (11) public companies.

 

5.         Another option we will pursue as petitioning creditors and as Chief Executive Officer ofeCom, ACH and the above referenced former “subsidiaries” described in paragraph sixteen(16) above, is we plan to reopen and file adversary proceedings, including possible contemptviolations etc., against you and your firm in the United States Southern District of FloridaBankruptcy Court in the above described eCom Bankruptcy Case No. 04.3539-BKC-PGH.Due to your negligence, we also will seek the return of monies, plus interest, that was paid toyou through the bankruptcy proceedings.

 

6.         Another alternative we have is to place American Capital Holdings, Inc. and all of the abovedescribed former subsidiary companies into Chapter 11 proceedings under Title 11 of theUnited States Bankruptcy Code.  Naturally, we will dispute any claims by you or your firm(s)and file an adversary proceeding to have your firms claims disallowed under the Plan andwould be discharged permanently via a court order.  As described in paragraph five (5) wewill also file an adversary proceeding, under the Section 548 fraudulent conveyance rule, seeking thereturn of the $306,000 the companies have paid you.  We have the required bankruptcyreorganization approval votes of all the classes of creditors as well as the equity securityholders to file pre-packaged filings on each of these companies.  This will allow us to have“fresh start” accounting status when we emerge.   

 

By copy of this letter, we request an answer within five (5) business days after receipt of thiscorrespondence as to what your decision is.  You should think through the consequences as the factsset forth above are the truth.  It is up to you to decide you and your firm(s’) future. Pleasecommunicate your decision directly to Rick Turner via his following described e mail addresses as Ihave to be out of town on business next week.  Rick’s e mail address is rick@achusa.com andrickobev@aol.com. The office phone number is 561.429.8704.   

 

Respectfully,

 

 

Barney A. Richmond

 

Enc.     Exhibits 1-31 above

cc:        File/chrono