About $6.6 million worth of inventory is missing from the Alpha Omega watch and jewelry chain, according to a complaint filed in Suffolk Superior Court by the high-end retail chain’s chief creditor.
The unaccounted for luxury goods had “either been taken from Alpha Omega, or such inventory never existed,” the Boston Globe reports.
A consultant retained by the Cambridge-based retailer told officials at LaSalle Business Credit, a retail lending arm of Bank of America Corp., about the inventory discrepancy on Dec. 19, the newspaper reports. The next day, LaSalle filed a complaint with the court and obtained a temporary restraining order stopping Alpha Omega from selling or otherwise moving any more merchandise. The court also reinforced the creditor’s right to seize the inventory, something LaSalle decided to do earlier that week because Raman Handa, his wife, and their son and daughter—all of whom are executives of the nearly 30-year-old company—abruptly left the country without alerting relatives or business associates.
The consultant was not named in the complaint but was identified as Altman and Co. LLC by Adrienne Walker, a lawyer with Mintz Levin Cohn Ferris Glovsky and Popeo who is representing Alpha Omega in its bankruptcy, the newspaper reports.
Michael O’Hara was hired by Alpha Omega and LaSalle alongside Lewis as the retailer’s chief restructuring officer.
Lawyers representing two vendors that sold luxury watches or fine jewelry to Alpha Omega and that are each owed hundreds of thousands of dollars were surprised yesterday to learn about the missing merchandise, the newspaper reports.
It is unclear whether the discrepancy is due to bookkeeping errors, pilferage, or some other reason, the newspaper reports. But an official at another jeweler tods the newpaper it’s hard to lose track of merchandise in a well-run jewelry store—especially if the store uses a good computer system—because every item that comes through the door is tracked through its final sale with a unique identification number.
The stress from trying to cope with Alpha Omega’s $30 million debt prompted Handa to check himself into a Boston-area hospital around Dec. 12. A few days later he flew to India, according to the company’s bankruptcy filing.
A lawyer and family friend who talked with Handa on Dec. 27 said he has been convalescing in India with the help of the country’s traditional Ayurvedic treatments, including meditation, yoga, and herbal remedies, the newspaper reports. However, neither he nor another Alpha Omega lawyer have received updates since then about the Handas’ whereabouts or when the family might return to the United States.
LaSalle’s litigation was put on hold after about two weeks because Alpha Omega filed for bankruptcy.
On Friday the Movado Group – which is owed more than $606,278 for stocking Alpha Omega with watch brands such as Concord, ESQ Swiss, Movado, and Ebel – filed a complaint asking Middlesex Superior Court to place a lien against Raman Handa’s Lexington home and any other real estate he owns.
Alpha Omega’s assets will be auctioned off Jan. 22. A joint venture between Tiger Capital Group LLC and Gordon & Co. entered the first bid at 70.25 percent of the cost value of the inventory.
The inventory was estimated to be worth $18.7 million on Dec. 31 but could end up being worth less by the auction date, since a bankruptcy judge has allowed Alpha Omega to continue selling its merchandise in the interim.
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