Problems at Platinum

 - 
02/03/2012

Word is that Platinum Protection suddenly laid off almost all its employees yesterday. So, is the summer model sales company based in American Fork, Utah closing, filing for bankruptcy? And does this abrupt action have anything to do with a recent lawsuit filed by the Securities and Exchange Commission, charging that the two men who provided the start-up capital for Platinum six years ago have been running a $220 million Ponzi scheme?

The industry is abuzz with such questions since the massive layoff yesterday. I haven’t yet heard directly from anyone at the company about what is going on. But The Salt Lake Tribune reported yesterday evening that a company official confirmed Platinum had dismissed 65 corporate employees and its sales and technical staff, leaving only a small management team to service existing customers. The official wouldn’t give the reason for the mass dismissal, the newspaper said.

Regarding the SEC lawsuit filed in December, Platinum has told SSN that it was as surprised as anyone about the accusations against Utah real estate magnate Wendell Jacobson and his son, Allen Jacobson, and said the pair no longer has any ownership in the company. But could some sort of negative fallout from the case have impacted Platinum’s financing?

There are many more questions than answers at this point.

As for the layoffs, I talked yesterday to one of the employees just let go.

The person, who didn’t want to be identified, told me that employees had had “no warning whatsoever” of what was to come when they were called into a company meeting around 9:30 in the morning on Feb. 2.

The person said they were told company officials had made a decision “overnight” to close the company. Employees were told “we were free to go and they apologized for the inconvenience.”

There was “a lot of crying and emotion and shock,” the employee told me.

The person said that in addition to corporate staff, perhaps as many as 500 other employees lost their jobs.

The Salt Lake Tribune reported that one employee said company officials said they hoped to pay employees what salary they were owed within a few weeks.

But no severance packages were offered, according to the employee I spoke to. The company told employees they could file for unemployment.

“It’s a mess,” the employee said.

I'll continue to report on this story. Stay posted.

Comments

Platinum Protection's owners did not even show up to their corporate office when they laid off 500 employees.  Instead they went to Florida to go on a cruise after they didn't pay their employees and told them to just file for unemployment. Jared Hallows, Keith Dyer, Chance Allred, and Jake Pruitt made sure they have taken money out and have hidden it.  They have no dignity and respect and are villians.  Scott MacArthur their CFO, who was fired from ADT for his bad and dishonest accounting practices, has never moved his family out from GA to their corporate office in UT that should have been one of teh first signs that they were in trouble 2 years ago.

The above comment is completely baseless and false.  One of the owners WAS in attendance at the meeting in American Fork.  No money was taken and hidden by the owners, and yes - the other owners were in Florida making sure that the employees that were owed the most money (sales reps and technicians) had a face to talk to and some help in figuring out the situation.  Having been a part of Firstline when they filed for bankruptcy - I think the owners at Platinum handled the situation honorably.  Platinum has done a great job making sure employees got paid what they were owed (to the best that they could).