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Wurld Media Execs Face Tax Fraud Charges

Two Wurld Media executives were arraigned on felony and misdemeanor charges including grand larceny, money laundering, falsifying business records, failure to pay benefits, and failure to withhold income taxes in Sarasota Springs, N.Y., on Friday, according to the local paper, The Glens Falls Post-Star. Wurld Media is a peer-to-peer company that Roo Group bought for $10 million in February.

wurldlogo.jpegThe charges reportedly came after a seven-month investigation by police and a state tax agency, and could potentially land the duo — Wurld Media CEO Gregory Kerber and CFO Richard Saxton — in prison for more than 50 years. The alleged crimes supposedly occurred late last year, prior to the acquisition, and during this summer, when funds from the sale were transferred.

Wurld Media has a checkered past. The company was involved with adware that was commonly attached to the popular P2P client Morpheus. A couple of years ago it started a new business unit called Peer Impact that was one of the first P2P services to establish legitimate relationships with Hollywood labels and studios. The software included an early revenue-sharing incentive for video creators and users who shared content. A year ago, Peer Impact offered its entire music catalog for a penny per song and 10 cents per album during the holiday season.

But the Peer Impact program, which required a Windows software download, never gained much traction. Roo’s modest acquisition price of $10 million (of which $2 million was reserved for milestone payouts) reflects that. Wurld Media does possess some intellectual property related to P2P technologies.

Roo discontinued support for Wurld Media over the summer. At the time, we were contacted by a Wurld Media customer who was understandably upset that he could not make new purchases or play existing ones. Despite our repeated queries via phone and email, Roo did not offer an explanation.

Roo now lists among its services an enterprise P2P product for media companies with the contact address being Greg Kerber’s email.

Our Peer Delivery Network (PDN) supports all industry standard media delivery methods and enables the development of new revenue streams from Pay-Per-View, Video-On-Demand, Subscriptions and Streaming.

Roo trades on the OTC Bulletin Board. It had sales of about $3.4 million in the third quarter, and a net loss of around $8.2 million.

56 Responses to “Wurld Media Execs Face Tax Fraud Charges”

  1. WurldIsTheDevil

    Are there any PeerImpact users out there who received a refund for unspent deposits when PeerImpact mysteriously disappeared? No one I know did. One friend had 50$ unspent on deposit in their PeerImpact account. Also, I remember in one share holder’s report Kerber claimed PeerImpact was gaining tens of thousands of users each week. How much money did Wurld steel from these people? Who’s responsible? Wurld? ROO?

  2. Well put, lando. But to be honest, selfish investor that I am, I’m more curious (outraged?) that this $4.3 million sale did not put any $ in my pocket. I mean, if the investors got nothing, and the former employees who are owed money got nothing, where the hell is the $4.3 mil?

  3. Lando Calrissian

    Just to give folks a little reality check, consider this:

    Whether an employee was duped, or made conscious decision to stay, or “gambled”, or whatever – there are state and federal labor laws that exist to ensure employees get paid. Ever hear of a “minimum wage”? If you’re not getting paid even the minimum wage (either outright from your employer, or once tips are factored in), your employer is breaking the law. It truly is that simple.

    That’s not to say whether that’s a charge here, since it sounds like it isn’t. Whether there were employee agreements that said people would arbitrate or not, employees not getting paid = employers breaking the law.

  4. Little M: I’m confused. It seems to me that none of the charges brought against these two men has anything to do with unpaid salary. What do they have to do with the criminal charges? Again, I don’t have a dog in the “lost pay” fight, but your analogy of going to work for a salary and expecting to be paid as the same as putting money in a slot machine is, um, interesting. Do you not view your salary as part of a contract you have with your boss? You do believe in contracts, don’t you, or are you an anarchist? By the way, I do fully support your view that people are responsible for their decisions, which is apparently what these two accused criminals are facing today.

  5. WurldIsTheDevil

    Lol. Little Mother is quite obviously one of the key jesters that “ran” Wurld Media. The Holier Than Thou attitude shines through quite nicely. Read LM’s (more like BM) posts and you will gain clarity into the twisted mentality shared by senior management at Wurld Media. Keep on writing BM! Your self-righteous yammering is priceless

  6. Stupid Wurld

    Little Mother (you know the rest)…lets not go down the vocabulary route as you yourself can’t seem to understand that lose as a verb is spelled LOSE, not LOOSE, Mr. Feathers :).

  7. Mr Hatch I know your reading this thread so how about you comment on sending the Peer Impact customers up the creek ……and leading us on for over a year while the company was self destructing .

  8. Drum roll please Little Mother sounds like a typical republican. Let me guess, Fox news won’t be covering this story. Let’s blame the victum. If I was raped, would you say I wore a hot dress and had blonde hair extensions. If I was robbed would you say I was in the wrong part of town. Come on – What kind of Kool Aide do they serve at WURLD Media. It’s the responsibility of the employer (WURLD Media) if they can’t make paychecks to lay off the employees and not keep them working with promises of a paycheck. Why were the executives still going out to lunch while the workers weren’t getting paid?

  9. Little Mother

    Just one more thing I akmost forgot you namrepus, You don’t have to know very much to know enough to walk away from a job that isn’t paying you and as for you queen of hearts I find it difficult to believe there are any saints to cry with in this situation.Although I believe there were many who thought they could wear the disguise of a saint. how foolish….

  10. Little Mother

    The only thing I know and the only thing I said was we don’t live in a country where we don’t have the freedom to do as we wish and make our own choices, if we make the wrong choice not once or twice but for days and weeks then we must take some of the responsibility.If you were willing to work with out pay that was your choice,but don’t try and take it out on someone else.That is the trouble with people today everyone is to use to relying on everyone else to take the blame.No I do not know the labor laws and I don’t need the government or a law to tell me when I make stupid choices, that is another problem you all expect big brother or a lawyer to take care of you. Get a grip pick yourself up brush yourself off and start all over again…

  11. Namrepus

    Well said Little Mother and that is why two execs are being brought up on charges that are bigger than not paying their employees and may face 50 in the big house. Again, I would like to discuss the money laundering, grand larceny, falsifying business records and other felony counts. Let’s discuss, you seem to know so much.

  12. Qn of Hrts

    Oh my, how do you find the time Little Mother or are you having a hard time sleeping? I am with you, I would rather laugh with the sinners than cry with the saints. They should take a look at their actions and move on in their lives.

  13. LittleMother

    Oh by the way stupid ,your concluding remark shows me the limitation in your vocabulary. that may be why you are having difficulty understanding why people must be held accountable for their own actions or reactions.

  14. Why arent the lawyers or the secretary or the board members arrested too? or the letter stuffer? will that get back all the back pay? If everyone’s life is destroyed? and their families too? get your pound of flesh somewhere else.

  15. Little Mother

    Listen here Stupid, I believe you have come a long way in the fact that you can not only acknowledge, but use the user name STUPID that tells me that I wasn.t far off on my first observation of the whole situation and confirms my thoughts that you were dumb enough to stay without pay.After so many empty promises as you claim were made to you, your user name just confirms what I said

  16. Ann Cambridge

    Stupid Wurld the only thing I don’t understand at this point is if you know for a fact that the CIO of Wurld Media, Kirk Feathers had knowledge that the employees weren’t receiving the pay–why more isn’t being done to hold him criminally accountable.

    Not being an attorney myself, is there anyone who can tell me if there is any way these former employees can bring action against Kirk Feathers themselves???

  17. I want to know the Role of Roo Media in all this mess .Roo shut down the Peer Impact network including the DRM servers and all the money in users accounts was withheld and the music purchased no longer played .
    Roo should be held liable for these actions as well as the actions of the former Wurld Executives but they seem to be burying their head in the sand over this matter even though they are a publicly traded company

    As a former Wurld MediaPeer Impact customer its interesting to read this thread including Mr Joe Hatch ( if it is indeed Joe Hatch ) making comment .Joe Hatch was an executive at Wurld Media and had a profile on the Wurld Media website.

    I’m disappointed that the Wurld Employees didn’t get paid, but didn’t you sign workplace agreements as reported in the Albany Bussiness Review in the Federal Class action suit that was sent back to Arbitration (damn Workplace Agreements – they suck) then from what Ive read the Lawyer from the Class Action went to the police .

    The charges filed seem over the top and the matter of money owed to the to the former employees could probably sorted out in civil court but I suppose if MRrKerber is convicted of the alleged charges then the Ex Employess could get a better payout and also provide a nice fee for their lawyer .

  18. Stupid Wurld

    Listen Here LITTLE MOTHER #$#%%^@…unless you were there to experience the weekly emails and lies that came out of the Executive Staff dropping names such as Disney, GE, NBC…the list goes on..promising Employees of Wealth right around the corner…and no these weren’t “Stupid” people by any stretch of the imagination..they were dedicated individuals with a dream….yea working months with no pay seems rediculous….but with the potential being there … days turned into weeks…turned into months…all with new promises…..SSTFU

  19. Wow: what kind of twisted logic would blame those who were lied to regarding their pay rather than the ones who lied? BTW, I’m a Wurld Investor. Over the years I got a lot of investor letters tracking all the wonderful plans for the company. I don’t seem to have gotten the letter informing me that the company I invested in was sold, nor have I seen any return on my investment despite the sale. Who put out those letters anyway?

  20. Namrepus

    Forget the blame game, I want to know more about the good stuff. Can someone fill me in on the money laundering? Little Mother, you seem to know a lot, can you fill us in?

  21. Ann Cambridge

    After reading the various comments can someone please answer me this one question—-If the CIO of Wurld Media, Kirk Feathers, had knowledge that these employees weren’t getting paid—why now is he not facing charges and why is no one demanding that something be done with him?????

  22. LittleMother

    Excuse me Mr. Hatch, I may not have made myself perfectly clear..Yes when you work you should get paid “X” amount of dollars. But when you are willing and make a conscious decison on your own to go to work week after week without pay then you must accept the consequences of your actions. Not come down on management like a pack of wolves and try and sue for what you already knew wasnt there..

  23. joe_hatch

    You work “X” amount of hours, you should be paid for those hours while you are employeed by Wurld Media.
    Blaming people that were victimized by Wurld is the typical Wurld Media bully mentality. Shame on you LittleMother.

  24. LittleMother

    How in the world can these employees who were dumb enough to work without pay and Iam sure realized there was a problem, show there stupidity once again by complaining about their back pay.After all those who were either dumb enough to or lacked initiative to quit there job and go else where, I can’t see how they can hold anyone but themselves responsible for there negligence to themselves and their famlies.It surely wasn’t a case of loyality. If they could be honest with themselves and others and the truth be known they all thought the company was going to suceed and did not want to take a chance that with their greed they may loose the pot of gold.Then were foolish enough to join and be led by former disgruntled employee,and her questionable motives.

  25. Stupid Wurld

    Its about time these two individuals are paying the price for their actions as of the past few years. There is another individual whom should be held accountable…Kirk Feathers, the CIO of Wurld Media. He was well aware of the actions and holds an equal share of the responsiblities of the outcome of these criminal actions. I am somewhat upset since the article does not elaborate on their worst crime of all…not paying their employeee, some for as much as a year plus. Even when Wurld was purchased by Roo, the owners, and their loyal ass kissers were paid their outstanding payrolls, but those who moved on, most for financial reasons, were at one point offered, by ROO Media, 40% of what they were owed, and some who agreed to these rediculous terms never even saw the 40%. How can ROO as a public company get away with this?? Im not sure, but the wheels of justice turn very slooooow…..stay tuned, more to come….