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The Castleton Group saga continues.

The more I learn about Suzanne Clifton the more irritated I am. Through research on her companies, The Excutive Staffing Group and The Castleton Group, I’ve discovered that she was also named one of Enterprising Women Magazine’s “2007 Enterprising Women of the Year”. Of course we can’t blame the magazine for such a mistake, but we can blame Clifton for feeding everyone many spoonful’s of BS by pretending everything was OK with her company while under investigation by the NC Insurance Commission.

Effectively, without notice, Clifton accepted this award while facing corporate insolvency and went on to insist to her clients everything was just fine right until the end. Have no doubt that her actions and inactions (in the form of disclosure) touched many who work in the Raleigh, NC area and I am beginning to hear from those affected personally. Suzanne skipped town out of embarrassment and may not come back (if we’re lucky).

8 comments

8 Comments so far

  1. Anonymous January 3rd, 2008 1:29 pm

    Castleton was desperately trying to get itself solvent again, and if it had succeeded, nobody would have been the wiser. Were Castleton’s actions deceitful and misguided? Absolutely. Were they malicious? No.

    It still hasn’t even been confirmed that Clifton knew everything that was going on. She had been an absentee owner (due to cancer) for a few years prior to to the start of the problems. It was only in the last couple that she’d been hands on again — more than enough time for others to create records that would fool her.

    Many people are calling for her to go to jail. How would that solve any problems for those missing paychecks and benefits? And what if she really didn’t know?

  2. Someone who knew enough to know better January 3rd, 2008 6:23 pm

    The Anonymous writer knew the situation at Castleton. Suzanne Clifton was an absentee owner due to illness. She had been trying to retire for quite a while now. She is a person of outstanding qualities. And when I say that, I’m talking about her, not Castleton. Her biggest fault was employing Jay McLamb, the CFO/COO. He is the person that needs to go to jail. I’m not saying that Suzanne Clifton doesn’t have fault in this situation. She is the owner which makes her overall responsible. But when we talk about someone’s character and intentions in this whole mess, she is a victim as well. Jay McLamb fooled everyone, including the accounting firm that did the financial audits. I believe she knew that the company was financially struggling but not to the extent that it was. I definitly believe she knew nothing about the falsifying of payroll tax returns. I believe Jay McLamb embezzled millions of dollars. I don’t know what he did with it but I can’t see how the company was that much in debt without embezzling going on. McLamb was full of secrets and made decisions based purely on his selfish wants and needs.
    And to clarify, Castleton was not under investigation by the DOI, but rather, Castleton had applied for licensing and the DOI was going through the due diligence process. Castleton had been going through the application process for quite some time and continually hadn’t qualified due to financial related reasons. I think the DOI could have handle the whole situation better. Their role is to protect the consumer. In their “shoot now, ask questions later” approach, they were a significant contributer to the overnight demise of this company and the lack of funds to pay for benefits etc. Castleton had been operating in the red for quite some time. If the DOI would have worked with Castleton to establish a plan to protect the employees, this may not have ended so horribly.

  3. Not Fooled January 4th, 2008 5:08 pm

    If anyone believes that this woman did not know what was going with her companies financials….I have some water front property in Arizona!!! On one hand we are saying that she was the woman of the year in a magazine…but we are to believe that she was clueless about her company and the fact that she was not operating legally. As for her Cancer, she battled that several years ago, and within the last few years, she has been a very active owner. The only time she was not active was when she was hanging out at her beach house with her $300,000 a year salary. I worked for this company and I have been in meetings with this woman, I think she is guilty as hell. She is using Jay as the scape-goat!

  4. think about it January 7th, 2008 9:58 am

    In corporate America, executives make too much money, have nice vacation homes, etc. She is no different than many other executives. Not at all saying that is the way it should be. Many making these comments about Suzanne Clifton are probably as guilty as she in many ways. So the real question is, who is responsible for the illegal activity, the deception? My guess is that it is not just one person and that there was some neglect on the part of many. The article in the N&O last Friday has some info from the former CEO that Suzanne said “The books can look any way you want them to”. The Suzanne that I worked with wouldn’t have said that, or at least I didn’t see that side of her. She was very much conerned about NOT doing that type of thing. But, let’s just say she did say that. If Scott Seccor, Jay Mclamb, or whomever, did anything illegal, “cooked the books” they are responsible for their actions, in my opinion.

    Can any of you reading this honestly say that if your boss told you to do something illegal (of this magnitude) and you truely thought it was wrong, you would do it? I sure wouldn’t have done it. And if I were the type of person who would have done it, I sure as hell would say Suzanne Clifton told me to do it, even if it wasn’t true, because that would make me look a little bit better. Or does it? A man (or woman) who doesn’t want to do something illegal, but does it anyway, and continues to do it. I know the players in this. Jay Mclamb, Scott Secor, Mick Carver. They are all not innocent victims. They are grown men who made their own choices.

    Most executives have enemies. So right now, it appears there is a witch hunt for Suzanne Clifton. What about these others? Doesn’t it matter about them?

    I suppose I just hate to see that folks are not holding others responsible who are obviously not innocent.

  5. PR February 9th, 2008 3:44 am

    First Point. In corporate America executives make too much money? What do you suggest as a solution? Should we do away with capitalism and become socialists? In well run PROFITABLE companies, executives make what they deserve–which is usually a lot. They are compensated for their talent, their skills, their sleepless nights, their dedication, their “skin in the game”, and their rarity. If it was easy, everyone would do it. In corporate America, executives DO NOT MAKE TOO MUCH MONEY. That is an ignorant class warfare statement that comes from an oversimplified, utopian viewpoint.

    Next point. You say she is no different than many other executives? Are you kidding? She is MUCH different (thank God). She pulled millions out of the company to finance her lifestyle while she owed 12 million to the government. There are over $6 million in transactions between Castleton and Executive Staffing. What do you think that means? According to the article, she bled the company dry. Also in the article her audit firm told her that her company was doomed and it would not continue. What did she do? Went out and got brand new expanded EXPENSIVE office space? What? That is sick. She is UNLIKE most executives, thankfully.

    Next point. Blaming others. Suzanne always has a scape-goat. Always. If others did something wrong than they should be held accountable. And with the SBI investigating, they will look at everything I am sure. Carver & Secor left in 2003, so she can’t blame them for 05,06, & 07 unpaid taxes. Mclamb? I’m sure as the CFO he had full knowledge and supposedly has admitted to falsifying financials. He will no doubt get his punishment. But Suzanne is trying to blame it all on him and take no responsiblitiy. Do you think Suzanne gives anyone full power? Follow the articles in the N&O. Now from what has come out in the latest articles, her quotes from earlier articles have been proven as lies. She has buried herself, in print.

    The “Suzanne that you worked with”, you mean the one with $20K worth of jewelry on, driving a $100K car, and traveling between million dollar estates? Her obsession with appearances and reputation has ultimately caused her demise. Sad. It really is sad. Castleton had some great employees, great clients, and some great aspects of their business. What a waste.

  6. Todd February 21st, 2008 3:05 pm

    Not all corporate executives make too much money but very many do and a lot of top financial analysts, I’d be happy to quote, agree that the rate of pay for CEO’s is past the point of being stupid.

    “Skin in the game” – what a joke. During the last decade many, many CEO’s have completely failed at their jobs, like the former CEO of K-mart, Charles Conway, who drove the company to bankruptcy and got a 11 million severance package. Or maybe you mean his replacement, Julian Day, who served 10 months as CEO and left with 30 million in fully vested options? If all I’ve gotta do is drive a company into the ground for 10 months to qualify for 30 million in vested options sign me up. I can do that.

    But all-in-all you started this comment out boring with the old capitalism verses socialism argument. Don’t step forward and readily admit having narrow vision. That position is black and white. In today’s economy nothing is black and white, not the problems or the solutions. Again, your opinion’s in the minority if you think that 90% of the money in our economy should be in the bank accounts of 10% of the population. This is clearly disproportionate to a corrupt level. “Trickle down” doesn’t work and that’s been proven – Socialism and Capitalism be damned.

    Oh and Suzanne is NOT unlike most of the top company execs I’ve worked with directly. They all have their personal lifestyles to attend to and unfortunately see it as part of their corporate and political appeal. After all, you can’t be CEO without a Mercedes can you? I’ve stepped into three or four 6000 square foot homes of men who are currently or have driven companies into the ground while they wait for a fat buyout, or worse, a severance bailout. Be careful PR, one of them may be the house of the CEO of the company you are working for right now.

  7. PR February 22nd, 2008 3:49 am

    The impetus for even responding to “think about its” post was the ridiculous blanket statement that “In corporate America, executives make too much money…”. And while I was writing my response to that, I was mainly thinking NOT about Fortune 100 companies, but companies more along the lines of Castleton’s size, as that was our original topic. I was speaking of privately held corporations that are typically ran by the person who founded, funded, and built the company. Companies that are ran by the risk takers that DO have skin in the game–not the hired guns with the golden parachutes. Sorry I was not more clear.

    I clearly was set off by that statement that villifed all executives and painted them with the same brush. The notion that we should punish those who succeed is not one that I subscribe to. If you believe that puts my views in the minority then so be it. Being in the majority is not a life goal of mine. I am completely comfortable not getting sucked into bashing those that make more money than me. The desire to succeed, the desire to have more money, and the desire to accomplish great things are all related. Wanting and having more money is NOT a bad thing. As Ayn Rand wrote, “Run for your life from any man who tells you that money is evil. That sentence is the leper’s bell of an approaching looter.”

    Is an executive (or anyone else) wrong for having a Mercedes, vacation homes, fancy jewelry, et cetera? Not at all. In most cases those are the fruits of their labor. When it IS wrong is when it is done irresponsibly (or illegally). In the case of what it appears happened at Castleton, as an example, it is wrong to have a lavish lifestyle when you use payroll taxes to do it.

    To the bigger question, Shouldn’t success be rewarded? Shoudn’t people have an incentive to accomplish great things? Too many times people fall into the easy trap of trying to bring down those that have accomplished more than them. Where you might think a Mercedes is conspicuous consumption and something that no human being “deserves”, someone less fortunate than you might think the same thing about an 800 square foot apartment with indoor plumbing and electricity. Demonizing and punishing those that make more than you is a slippery slope and one that many politicians use to their benefit. Tax the rich, feed the poor. Oil company bad, drug company bad, rich executives bad, insurance company bad, profits bad (did I leave out any of their other favorite targets?).

    I hear plenty of people complain about the “rich” (which according to some prominent politicians is anyone making over 75K per year). So after we strip them of their money, of their rewards, of their incentives, who is going to step up and do the work that they do? Sure, you can point to the failures like K-Mart. But the fact is there is much more GOOD than bad. It’s not a perfect system, by far, but punishing those that succeed is NOT the answer. I know for sure that if I am sick, I for one WANT that life saving drug made by the “greedy, evil, conspiring, drug companies”. And guess what? I’ll even pay for it, because I do not believe that I am entitled to it.

    And finally, I stand by my comment that Ms. Clifton is very much different from most executives. The only time I have read or heard about an executive who owed over 11 million in payroll taxes, they went to jail. Most executives pay their taxes or they are punished. Most executives don’t put lifestyle and image above the law. Most executives don’t move into more expensive office space after they are told their company is out of money. Most executives don’t pull millions from their company in lieu of paying the IRS. Thank God they broke the mold after Suzanne was made.

    Thanks for the forum Todd. I don’t know you but you seem like a cool guy and I have enjoyed the discussion so far.

  8. Todd February 24th, 2008 8:03 am

    Absolutely I believe success in business should be rewarded. But more and more it’s only a select few with positions of entitlement that are eligible for such a reward. CEO’s, CFO’s and even CIO’s are almost never promoted from within. They are usually a friend of a board member traveling in elite social circles being handed their next favor.

    I’ll give you an example where my comment above is not true: Scott Mclaughlin of Strategic Connections here in Raleigh. He’s applauded as a self-made man who started a company and never put it into debt, performs quality work and takes care of his employees as an asset. That’s why he’s got one of the best low voltage cabling companies in NC. Unfortunately in my personal experience he’s a rare exception. A Fortune 500 example is the founder of Costco who pays himself just over $300K annually as CEO because as he put it “If I make 10 times more than my average employee that’s enough”. You can’t find humility like that very often these days.

    Instead, all around Raleigh I’m starting to see bumper stickers on BMW’s and Escalades that say “Blessed and Deserving”. This is the unfortunate opinion of too many people today who hold themselves in higher regard than their actual worth to society or business. Some have come into money through shrewd investing by others, insurance settlements, or most common, a property sale up north a few years ago. These people measure their self-worth through their bank accounts. In reality a conversation with a lot of these folks will leave you longing for intellectual and moral companionship, something akin to bad sex. Basically they’re not “deserving”.

    Meanwhile there are far more hard working people that are not employed as rocket surgeons and they just haven’t been positioned in life for the nice windfall others have been “blessed” with. This is the real problem as I see it. It’s not that success shouldn’t be rewarded but in contrast too many are being rewarded today for failure or worse, nothing at all.

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