The owner of a Raleigh based e-commerce site was in court Monday accused of criminal contempt after the attorney general says he violated a judge’s order by taking money without the court’s permission from his company’s accounts that he was supposed to use to pay back victims.
This all links back to a story CBS 17 first told you about back in May of 2017 when viewers complained about not getting refunds or the items they ordered from eRummagers.
Caleb Udophia ran the online retail business — a website that accrued hundreds of complaints customers and garnered an “F” rating from the Better Business Bureau.
CBS 17 consumer investigator Steve Sbraccia first brought the company to the attention of the North Carolina Attorney General’s office, which took Udophia to court last November charging him with deceptive business practices.
In court, Udophia was ordered by a judge to refund money to over 1,400 people who the state of North Carolina says were victimized by eRummagers.
Udophia was told by a judge that he would be charged with criminal contempt if he did not adhere to the preliminary injunction imposed by the court.
“The defendant was told not to touch the money — not even to pay his attorney,’’ said assistant attorney general Kristine Ricketts.
The state claims the refunds haven’t taken place and charges that Udophia is taking money from the company’s accounts and spending it on gym memberships, nightclubs, travel and groceries.
For Monday’s contempt hearing, the attorney general’s office filed a series of documents claiming Udophia illegally used company funds for personal use including:
• Withdrawing money from the company’s bank account using ATM machines.
• Writing at least $15,000 worth of checks to himself from the company’s account.
• Paying the rent on his personal residence from the company’s accounts.
• Using his company’s debit card to make retail purchases at local grocery stores.
“It’s my understanding the defendant has a defense and it’s not necessarily disputing what we have filed your honor,” Ricketts told Judge Paul Ridgeway.
In response to those claims by the state, Udophia’s lawyer told the judge, “We have no objection to any of that at today’s hearing.”
The attorney general also alleges one of his investigators found Udophia had moved thousands of dollars from the company’s accounts into an account that’s in his name only.
And from that account, investigator Michael Ramakias claims Udophia transferred thousands of dollars to coinbase.com which is an online provider of cryptocurrency, including Bitcoin.
The contempt hearing resumes Tuesday morning.
At that time, the court may hear testimony from the owner of eRummagers.