VoIP-Pal Sues Former CEO, CFO
VoIP-Pal is suing its former CEO and chief financial officer for allegedly defrauding the company of millions of shares of stock, according to documents filed in the Nevada circuit of the U.S. District Court. The suit claims Richard Kipping, former…
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VoIP-Pal CEO and current president of Locksmith Financial, and Terry Kwan, former CFO and current owner of TK Investments -- a shareholder of VoIP-Pal -- entered into a $1.5 million loan agreement between VoIP-Pal and Locksmith Financial but "did not authorize defendants to unilaterally issue stock to Locksmith in exchange for debt." The lawsuit also alleges both Kipping and Kwan issued several million shares of VoIP-Pal stock at a reduced price as payment for the loan, which VoIP-Pal claims in the suit had not been communicated to the company's board and was in violation of the loan agreement. According to the court filings of VoIP-Pal, the total value of the stock transactions as repayment for the loan totaled nearly $1.55 million. VoIP-Pal also accused Kipping and Kwan of initiating a $360,000 debt-to-stock conversion in which the company bought back 9,000,000 shares of stock, and then "caused that VoIP-Pal ... issue 36,000,000 shares of VoIP-Pal stock" -- which the company claims was worth $4.8 million at the time -- in exchange for the settlement of the $360,000 loan. VoIP-Pal, Locksmith Financial and TK Investments could not be reached for comment Friday.