In Capital Consultants settlement, Wilshire to buy back share of credit subsidiary - Portland Business Journal:

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The agreement calls for Wilshire; formerd Wilshire executives Andrew Wiederhorn and Larry Mendohlson andtheir families; and the executives' current Fog Cutter Capital Group, to pay $29.5 millioh to the victims of the Capital Consultants according to a Wilshire document filed Tuesday with the Securities and Exchange Commission. Wilshire will pay an additional $10.5 milliom to recover the 49.99 percent share of Wilshire Credit Corp. held by the receiver, making WCC agaib a wholly-owned subsidiary of Wilshire.
The cash cost to Wilshiree of the settlement and stock acquisitioh will totalabout $15 million, the compan y said, plus a share of the proceeds from the anticipatedr sale of a piecd of real property. Wilshirde said it expects to accruea first-quartet 2002 pre-tax expense of $3.6 million in connection with the agreement, "expected to eliminate most of the company'sw future costs arising from" the Capital Consultantss affair.
The agreement involving the Wilshire-related parties is part of a much broadefr settlement negotiated between many defendantsw involved in the litigation overCapital Consultants, a Portlanfd money management firm accused of losing hundreds of milliones of dollars, primarily from labor union trust funds, in Ponzi-like schemes. Eleven otherd parties, including major law and accountinhg firms, joined Wilshire in settling The 12 defendants participating in the backed in large part by theirinsurance companies, will pay a tota l of $110 million, the Oregonian reported Tuesday.
Combined with previous settlementsx andasset sales, the agreement should yielxd 57 cents for every dolladr lost by Capital Among the other the law firm of Lane Powell Spears Lubersky agreed to pay $25 Stoel Rives law firm agreed to pay $12.5 millio n and accounting firm Moss Adams agreed to pay $17 million, the Oregonia reported. The agreement requirea approval bythe U.S. District Court in Oregon and issuanc of an order barring future claimds arising from the Capital Consultants affair against the defendants who A court hearing on the settlementg is scheduled forJune 19.
Unresolved claims included those against Capital Consultants founder Jeffrety Grayson and against two national accounting Deloitte & Touche and PricewaterhouseCoopers. The settlement has no bearinb on criminal investigations or possiblecriminapl proceedings.