Man accused of stealing $100M from special needs trust fund company faces more legal action
CLEARWATER, Fla. - A Pinellas County businessman who's accused of stealing $100 million from trust funds for people with special needs is in more hot water after he was hit with a lawsuit filed by the Florida Attorney General, accusing him of orchestrating a similar scheme through a different company.
According to a civil complaint, more than $2 million is missing from dozens of trust fund accounts connected to Directed Benefits Foundation, a nonprofit operated by Leo Govoni and oversees trusts for disabled clients.
The lawsuit filed by the state accuses Govoni and his business partners of "creating false accounting records...to conceal its wrongdoing and evade detection."
A judge issued an injunction halting Directed Benefits Foundation's activities and freezing its officers' assets.
"The Directed Benefits Foundation is supposed to provide crucial trust services to vulnerable populations; however, this nonprofit may have acted in bad faith with millions of beneficiaries’ monies being unaccounted for, including monies meant for life-sustaining services," Kylie Mason, a spokesperson for Attorney General Moody, said in a statement. "The Attorney General’s Office is taking action to ensure the Foundation is acting in the interest of beneficiaries, and not unlawfully diverting funds."
The accusations in the Directed Benefits Foundation case are similar to the ones Govoni already faces in the case involving the Center for Special Needs Trust Administration, a nonprofit he founded.
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Govoni is accused of taking $100 million in loans during an 11-year period from the Center that he never paid back. Court records show the accounts of at least 1,500 clients, some severely disabled, were partially or entirely drained.
The Center is now under the supervision of a court-appointed Trustee, Michael Goldberg, who gave families impacted by the case an update last month.
"The forensic accounting is a significant part of this case, understanding what went on. It will also serve as the cornerstone for claims against third parties who may have actively engaged in potential fraud, or assisted in fraud or any other negligence, whatever other claims we can bring," Golberg said during a virtual hearing with families.
Govoni did not respond to a request for comment Thursday, but has previously told FOX 13 he disputes the allegations against him in the Center for Special Needs Trust Administration case.
The controversy surrounding Govoni has now spread to Big Storm Brewing Co., a business owned by his son, L.J. Govoni. A Big Storm investor, David Wenk, filed a lawsuit Wednesday, accusing the Govoni family of funneling money from the Center for Special Needs Trust into the brewery.
Wenk's attorney, Drew Patterson, said he reviewed Big Storm's financial books and records and found hundreds of bank slips that appear to show deposits from the Center in the brewery.
A spokesperson for Big Storm, however, blamed banking errors. In a statement to FOX 13, L.J. Govoni threatened a countersuit against the investor, writing:
"The claims made in this lawsuit are entirely false, baseless, and lack any factual foundation and are designed solely to tarnish my reputation and embarrass my family. Look no further than the fact that I first heard about the suit from the media. Mr. Wenk knows full well that I have absolutely nothing to do with the Center for Special Needs Trust Administration. I want to make it unequivocally clear that I have never engaged in any fraudulent activities or wrongdoing as alleged. These accusations are not only unfounded but also defamatory, and I am committed to fighting them vigorously. In response to this malicious attack on my character, I intend to take immediate legal action against Mr. Wenk and his associates. While the law affords a Plaintiff the right to allege wrongdoings, it does not allow them the right to their own fictious facts. The basis of Mr. Wenk’s lawsuit contradicts documents he himself signed stating his accreditation, sophistication, and the due diligence he performed on this investment. For him and his counsel to assert otherwise is nothing short of a bald-faced lie. I will not allow attacks on my character to go unchallenged and will pursue all available legal remedies."
Patterson, meanwhile, responded to the statement, telling FOX 13, "We have been told that L.J. Govoni now claims these transactions were all banking mistakes. We hope that's true, but will need evidence that contradicts the documents Big Storm provided."
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