Jo walker direct

**Please introduce yourself to the court.**

Good afternoon, I am Jo Walker. I’m a certified public accountant in a private practice in Lansing, Michigan.

**Could you briefly describe your professional background?**

I graduated summa **cum** laude from Michigan State University in 1981, with a Bachelor of Science in Accounting and I was recognized as the top student in my class.   I then worked with Arthur Andersen in Chicago as an auditor, and left in 1984 to establish my own firm, Account Abilitee. I also specialize in forensic accounting and have been a certified fraud examiner since 2003.  

**What is it?  (document)**

This document is my curriculum vitae, a summary of my education, my certifications, plus my past and present employment.

**Ms. Walker what do you do as a forensic accountant?**

As a forensic accountant, my job is to examine financial information and find any evidence of criminal activity.  Once found I advise them on further action.  

How do you do this, can you explain more?

I do this by looking at and understanding the way a business operates. Sometimes money slips through the cracks at businesses, it’s my job to find out where it went.

**You did (see money slip through cracks)… alright, lets go to a beginning point….When did you first come into contact with the Defendant?**

March 1, 2021 at a local Chamber of Commerce event. 

I gave a presentation regarding profitable financial practices for small businesses. The defendant approached me afterwards.

**Alright, can you share with the court that conversation ?** 

Lane Hill asked if I could undertake a financial investigation of their business, Southberry’s, and make recommendations for increasing profitability.  Lane wanted to know why the business was in the red even though customers were steady.

**Ok, as Lane Hill’s contracted consultant, what happened next?**

I started my investigation into the restaurant. My arrangement with the defendant let me work on the premises.  This way, I could view all accounting records and watch restaurant operations and personnel. I reviewed many business documents and interviewed both owners the Defendant Lane Hill and Zoe Caine.  I interviewed a couple of restaurant employees during my site visits.

**After those site visits,  what did your investigation find?**  

On the surface, it appeared that Southberry’s operated rather smoothly. 

The Defendant managed the food preparation, restaurant style, and service, and left Zoe Caine, their business partner, to handle the financial matters of the business.

I did initially believe there was no suspicion of fraud or wrong doing. 

However, I found it interesting that the defendant paid me with their personal account, and their business partner, Zoe, did not have any part in my hiring.

**Interesting…. What conclusions did you draw from your investigation?**

After reviewing hundreds of financial and business records, I found evidence of theft schemes.  More specifically, check fraud and bank deposit manipulation.

**Checks and deposits, could you identify who committed the suspicious check activity and bank deposit manipulation.**

Yes, the paper trail led to Zoe Caine

**Alright, please share with the court now the data totals you determined?**

In total, I uncovered 67 instances of theft totaling $273,958

**What effect did Zoe Caine’s theft have on Southberry’s?**

Unfortunately it left Southberry’s with little to nothing. The restaurant was operating at a net loss of over $150,000 and had a negative cash flow. 

**In your professional opinion, what options did the defendant have for the restaurant?**

Looking at the numbers, I could only make two recommendations.

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The reasonable next step was to file for bankruptcy and lose everything they had worked for.

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Another possible option, would be them receiving a large influx of cash. They would have needed at least $4-500,000 to recover from the theft of Zoe Caine and pay back any debts.

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Considering the financial situation of the restaurant, no banker would have lent them money. So, they really didn’t have any assets or options for cash.

**When did you tell the defendant about this conclusion?**

I met with the defendant on March 19th and when I first informed them of Zoe’s theft, they appeared to be in shock.

**How did the defendant respond to the rest of your conclusions?**

I told the defendant that they would have to file for bankruptcy, because realistically there was no other option. 

When the defendant heard this, their tone turned aggressive, saying, “Well, I’ll make Zoe pay for this. She won’t make a fool out of me. You have done your job. You can leave. I will confront Zoe alone.”

**Was there anything else of importance that you found during your investigation that you would like to share with the jury?**

There was one financial document that has been putting me on edge. The defendant and Zoe signed a “Buy-Sell agreement,” in 2017.  

**What is a “buy-sell agreement"?**

The agreement states that in the event of the death of either partner, the other partner will be given a sum of money per the insurance policy. It’s basically life insurance that goes to your business partner.

**What would that have meant for the restaurant?**

If one of the partners died, the other partner would be able to buy the deceased partner’s share in the business. 

**How much money would the Defendant receive from the buy-sell agreement?**

$500,000

**In your professional opinion, is that sum of money enough to financially save the restaurant - serving as that needed influx of cash?**

The money would completely save the restaurant from its insolvency. 

If the defendant really wanted to keep this business open,the buy sell agreement would be their only option.