The former chief financial officer of Tommy Hilfiger Group's handbag licensee pleaded guilty to fraud charges in the theft of more than $19 million over a seven-year period.The U.S. Attorney for the Southern District of New York said Tuesday that Martin S. Bodner, former chief financial officer of Tommy Hilfiger Handbags & Small Leather Goods Inc., an independently owned licensee of Tommy Hilfiger Group, pleaded guilty to mail fraud and wire fraud charges. According to court papers, the theft occurred while Mr. Bodner was employed by the handbag licensee from the middle of 2000 to the end of December 2007.
Mr. Bodner, 60 years old, agreed to repay the licensee an amount no less than $19.6 million minus the $2.5 million Mr. Bodner has already returned to the company. He also agreed to forfeit a home in Sands Point, N.Y., a Manhattan apartment, three cars and various other property. Mr. Bodner is scheduled to be sentenced on Nov. 5. The sentencing guidelines in the plea agreement said a prison sentence within "the range of 63 to 78 months is reasonable." The court may also impose a fine ranging from $12,500 to $125,000, the plea agreement says.
Mr. Bodner's attorney, Matthew Menchel had no comment. Ludo Onnink, chief financial officer of Tommy Hilfiger Group, said in an email message that Tommy Hilfiger Handbags & Small Leather Goods -- which changed its name from Dickson North America in 2000 -- has been a licensee to Hilfiger Group for nine years. "We are not involved in the fraud of this guy and have no ownership or interest in Tommy Hilfiger Handbags & Small Leather Goods," Mr. Onnink said.
Mr. Bodner was first arrested in connection with the fraud on Dec. 21, 2007, by the Federal Bureau of Investigation. According to court papers, Mr. Bodner supervised the handbag licensee's payroll, which gave him control over the amounts the company paid to its employees through a third-party payroll service.
Court documents state that Mr. Bodner began stealing money from the licensee by secretly increasing his salary and bonus as well as getting reimbursed for phony business expenses. Court papers state Mr. Bodner directed the firm's payroll service to increase his compensation by $14,712,000 during his six-and-a-half-year tenure.
Mr. Bodner also put one of his sons on the payroll during 2004 and 2005, with a salary of $225,500, "when in truth and in fact (Mr.) Bodner's son did not work," for the licensee, according to court papers. Mr. Bodner "caused hundreds of checks to be issued to various payees for the purpose of paying off (his) personal credit card bills, purchasing a luxury automobile for himself, paying for insurance for a home, apartments, and automobiles owned by Mr. Bodner, and paying for decorating services," court papers said.
By: Teri Agins
Wall Street Journal; September 17, 2008
