Martin Shkreli's Accountant Describes Working for Client from Hell

By:
Chris Gaetano
Published Date:
Jul 18, 2017
Martin_Shkreli_2016

Controversial pharmaceutical executive Martin Shkreli, known for a number of wildly unpopular acts such as dramatically raising the price of a life-saving medication, was also a terrible client, according to court testimony from his former accountant, says CNBC. NYSSCPA member Corey Massella took the stand during Shkreli's securities fraud trial, where the infamous "pharmabro" stands accused of defrauding investors in two hedge funds he ran, and then misappropriating more than $11 million in assets from Retrophin Inc., another one of his companies, to pay them back. 

Massella, his accountant, worked with Shkreli as he was trying to take Retrophin public, according to CNBC. He said that his client repeatedly sent changes to the stock ownership tables, requiring him and his staff to then spend days revising other information to reflect the changes. This was on top of the already-sorry state of his company's books, which he described as "chaotic." They were characterized by a lot of very, very small entries, many of which came from debit cards, an abundance of personal expenses like iTunes and Starbucks purchases, and virtually no oversight on cash expenditures. 

Massella further said that it was difficult getting information out of Shkreli. While a lot of money needed to be tracked after a merger, there was virtually no documentation on what that money was actually for, as they didn't go through payroll, said CNBC. He also said that there was a $575,000 transfer from the company to Shkreli's personal bank account, which also did not go through any payroll system. When asked what in the world the money was for, the executive said it was for his own compensation. When asked why it was so much higher than his $250,000 base salary, he replied that the sum included back pay and bonus pay.

Shkreli also became testy when asked about payments to contractors, such as what the contracting agreements said and whether they should instead be classified as employees. Further, he out and out just took $4,130 from the company to pay for a hotel in Atlantic City, and when asked about the purpose of the trip, said that it wasn't for business and that he would refund the company. 

Finally, according to CNBC, he and his sister were just plain rude. This eventually caused his firm, Citrin Cooperman, to end its relationship with him, with managing partner Joel Cooperman saying that communications were "outrageous and rude." 

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