INDICTED! Former Starkey Execs Ruzicka, Nelson, Miller Charged with Embezzling $20 Million

INDICTED! Former Starkey Execs Ruzicka, Nelson, Miller Charged with Embezzling $20 Million

The mud is flying in the Starkey swamp! Three former Starkey execs plus two more at hearing aid component supplier Sonion were just indicted for embezzlement, mail fraud, wire fraud, conspiracy to commit money laundering, financial transactions involving fraud proceeds, and more.

Gloved FBI investigator takes a vehicle from the home of former Starkey President Jerry Ruzicka's home, November 4, 2015 (Photo: Jana Shortal, KARE)

Gloved FBI investigator takes a vehicle from the home of former Starkey President Jerry Ruzicka’s home, November 4, 2015 (Photo: Jana Shortal, KARE)

From Fox 9:

Three former Starkey Hearing Technologies executives are among five indicted in connection with a conspiracy to steal more than $20 million from the Eden Prairie, Minnesota-based maker of hearing aids. According to the charges, the defendants created sham companies to give themselves consulting fees and forged the signature of Starkey founder Bill Austin cash-in on stock. Among the most salacious allegations is that embezzled money was used to purchase a $119,000 Jaguar and a $200,000 condo to carry out an affair.

More details emerged minutes ago from the Minneapolis Star-Tribune:

Federal prosecutors filed criminal embezzlement charges Wednesday against three former executives of Starkey Hearing Technologies, alleging that they conspired with two other men to steal more than $20 million from the Eden Prairie-based hearing aid maker.

The charges were filed against Jerry Ruzicka, the ousted president of Starkey; Scott Nelson, former chief financial officer; and Larry Miller, the former human resources head. Jeffrey Taylor and Lawrence Hagen, business associates of the former executives, also were charged.

U.S. Attorney Andrew M. Luger announced the federal indictment Wednesday, saying the men tried to steal more than $20 million from Starkey and its principal owner, William F. Austin. The scheme allegedly ran from 2006 to 2016 and involved creating a series of sham companies.

According to Luger, one scheme involved a sham company named Archer Consulting. Ruzicka is accused of directing Starkey to pay Archer Consulting “commission” payments for purported sales of hearing aid components from a firm named Sonion. Taylor was president of Sonion.

The charges go on to say that in 2010, Ruzicka and Taylor changed the fraudulent payments from “commissions” to “consulting fees” and arranged for monthly commission fees of $75,000 to be paid to Archer.

Between 2006 and 2015, Ruzicka and Taylor stole about $7.65 million through the sham company, federal documents said.

The defendants are expected to make initial appearances in U.S. District Court in Minneapolis later this week, federal officials said.

The indictment comes one year after Ruzicka, three other Starkey executives and two executive assistants were abruptly fired from the company, some escorted from Starkey’s headquarters by sheriff deputies.

More from Fox 9:

According to the indictment, between 2006 and September 2015, the defendants “deployed various tactics to steal from Starkey, including controlling a complicated web of sham companies and dummy entities, surreptitiously awarding themselves restricted stock in Starkey’s retail affiliate, and embezzling money from the company by causing payments to be made by Starkey for the benefit of the co-conspirators and others.”

Extended coverage in The Hearing Blog here

← We Can't Make This Up: Starkey Korea's "Proclamation Event" With Local Partners Med-El & Dongsan Sonova Stock Hits 52-Week High →

About the author

Dan Schwartz

Electrical Engineer, via Georgia Tech

Leave A Reply

Time limit is exhausted. Please reload CAPTCHA.

%d bloggers like this: