Sunday, January 11, 2009

When reporter interviewed Herb Strather he failed to do the math

In February 2005, Robert Ankeny wrote in Crain's Detroit:

When MotorCity was being organized in the days before the city's Detroit casinos were authorized, Strather said, 112 Detroit area people each bought one or more $25,000 units in the company that eventually founded the casino.

"Many put in $100,000, four units," he said, making their holdings worth about $1.7 million today.

Strather said this investment growth in MotorCity doesn't include the $38.5 million that he and three other initial investors - Nellie Varner, Ron Slavik and James Blain - received when they sold their shares to Ilitch and to Mandalay, operating partner for MotorCity.

These four, along with former New Detroit President Paul Hubbard, funeral director O'Neill Swanson, and Barbara Callaway, who was Strather's grade-school teacher, were the original investors in 1994 when the city of Detroit voted approval for three casinos, Strather said.

Then, in March 2005, Robert Ankeny of Crain’s Detroit wrote:

Strather, who in the early 1990s organized the group that became Atwater Entertainment Associates L.L.C., said he, Karmanos and about two dozen of the 108 partners who own fractional shares of MotorCity also have offered to buy out and restructure that 11.5 percent of MotorCity for $118 million. Strather withdrew from the casino licensing process in 1999 before MotorCity opened, he said, in part because overdue taxes on some of his past development projects might have hindered approval from the Michigan Gaming Control Board.

But just a few months later, in October 2005, Robert Ankeny wrote:

Detroit-based Atmashpee L.L.C. scored a victory in a decades-old battle to win federal recognition for the Mashpee Wampanoag tribe in Massachusetts, said Herb Strather, Detroit developer and organizer of the company…

Atmashpee (the name is a blend of Mashpee and Strather’s Atwater Associates, organizers of what became MotorCity Casino L.L.C.) includes $12 million invested by more than 200 people. About 150 of them are former Atwater partners, he said

How is it that Ankeny could write in February & March that Strather's Atwater Entertainment Associates was a group of 108 - 112 partners and yet in October he reports 150 former Atwater partners represented 3/4s of the 200 investors in Strather’s AtMashpee casino syndication?

Was Ankeny enabling Strather to spread falsehoods and mistruths to some benefit?

Were Strather's inconsistencies meant to attract new investors or give some comfort to existing investors?

Were these representations designed to make others like Len Wolman, Sol Kerzner and brothers Richard & Stephan Slavik think there was more to AtMashpee LLC than there really was? Or were there some never-revealed "silent" partners behind Atwater Entertainment Associates that perhaps included Wolman, Kerzner and/or the Slavik brothers?

As noted in the first Ankeny reference above, the Slaviks' cousin, J. Ronald Slavik, was known as an "investor" in Atwater Associates.

See "Investors" List: Atwater Entertainment Associates LLC

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