(KMSP) - For former president Jerry Ruzicka and the other Starkey executives, the reckoning was a year in the making.
After many months and the FBI raids of Ruzicka’s home, the dramatic fall from grace is revealed in 29 search warrants that have now been unsealed.
One of the documents includes the details of Ruzicka’s firing last September in which Starkey CEO and founder Bill Austin called Ruzicka into a conference room and asked bluntly, “how much money did you make?” to which Ruzicka replied, “about $10 million.”
Later that night, the two met at Campiello in Eden Prairie, Minnesota. Ruzicka asked if the money could be considered his pension, and Austin said no, because he didn’t know the extent of the scheme.
The search warrants peg that number at $30 million, which is $10 million more than the unsealed indictment indicated last week.
Prosecutors detailed how the three executives created shell companies and took hidden commissions and bonuses. However, the biggest windfall came when Ruzicka took over Starkey’s hearing aid retail operation northland U.S., changing the name to Northland Hearing and making himself president and CEO.
Ruzicka issued 51,000 shares in stock and valuated the company at $100 million, even though it never made a dime. He then had Starkey buy back the stock for $15 million.
Last week, the attorneys for the fired executives said they’ll argue Austin knew everything and only fired them because they refused to promote his step-son Brandon Sawalich.