ED Magedson – Founder
Intelligent Ethanol Systems, LLC761 Beta Drive, Unit 1 Mayfield Village, Ohio United States of America
Apparently, Paul Spivak, CEO of Intelligent Ethanol Systems (and Solei Tanning Systems) is known to be an Investor thief as described in other complaints against him filed in the State of Ohio.
I first located Mr. Spivak's company, Intelligent Ethanol Systems (IES), in June 2006 on a website advertising Franchise Opportunities for honorably discharged Veterans of the U.S. Armed Forces, VetFran.com. I am a retired U.S. Navy Senior Chief Petty Officer with 22 years of honorable active service beginning during Vietnam and ending after Desert Storm. I have a 50% V.A. disability rating for service connected injuries. Having recently lost my employment in Law Enforcement, I believed that I had done my due diligence by investigating everything I could regarding Mr. Spivak and his company franchise offering.
In August 2006, My brother and I flew to Cleveland, OH to meet with Mr. Spivak and his partner Tim Niedel (who left the company abruptly) to invest in their company by purchasing a territorial franchise for the rights to promote and sell Ethanol Conversion Kits throughout the entire State of Oregon. Our investment was $36,000. It was ALL the money I had and my brother mortgaged property for his portion. Over the next 24-36 months, our LLC, ORIES (registered in Oregon) enlightened and interested many of our family and friends. After discussions with IES, we purchased the territorial franchise for the State of Colorado for $60,000 paid for with our investors funds.
We promoted the company products vigorously throughout Oregon and Colorado. We wholesaled products to various "Green" auto businesses and demonstrated the product installation during a televised news story in Denver, CO. We contacted state agencies in both states, including both State Governor's offices. We sold several conversion kits with great success in both states. We attended various state meetings discussing alternative fuels and their options.
Our troubles began early with difficulties getting EPA certifications on the conversion kit. According to Mr. Spivak, this was a long and expensive process. In October 2006, IES received its first restricted EPA approval letter. Mr. Spivak advised everyone that additional certification was going to take more time and more money.
During the first year, IES would have prospective franchisees contact me for my take on the company and its product capabilities. I believe my discussions created many investments for IES as I believed very strongly in the company and product capabilities. Franchises were being sold in many states, Australia and Indonesia.
Our troubles continued into 2008 with no EPA approvals and difficulties contacting IES company representatives in Ohio. We began having problems obtaining product. Mr. Spivak then required all franchises to "Pre-purchase" a minimum number of conversion kits per year or we would lose our franchises. I had addressed this in our contract and was assured (in writing) that this condition would not be imposed until a sufficient number of Ethanol providing stations were operating within our state territories.
IES just quit answering the telephones and email. We couldn't get product for our clients and our reputation dwindled quickly. I am still unemployed with no more unemployment payments. The unemployment in Oregon is the worst in the U.S. at 12.4%. I now see that Mr. Spivak has a new partner, is doing business in Florida as St. Martin Powerboats. His business address is still the same as IES, just a different unit number. Other investors have attempted contact with Mr. Spivak and his standard response is to contact his lawyer. This guy just threatens to sue for defamation. I understand the Australian investors have filed suit in court against IES and Mr. Spivak.
I, and I'm sure many others, would like to file a class action lawsuit against IES and Mr. Spivak. I truly believed I was making a wise and "everything goes" investment, only to be Ripped-Off by Paul.
This report was posted on Ripoff Report on 08/11/2010 04:39 AM and is a permanent record located here: http://www.ripoffreport.com/reports/intelligent-ethanol-systems-llc/mayfield-village-ohio-44143/intelligent-ethanol-systems-llc-paul-spivak-ceo-franchise-investor-theft-mayfield-villag-630509. The posting time indicated is Arizona local time. Arizona does not observe daylight savings so the post time may be Mountain or Pacific depending on the time of year.
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