CZAW aircraft company is going bankrupt. Can Chip Erwin get away with it a second time?
People need to know the facts. You may remember that Chip Erwin started a company in the Czech Republic years ago called "Nextair". Chip got funding from banks, who lost everything as the company went bankrupt. When Nextair did go bankrupt, he left the company and purchased the assets at less than 10 cents on the dollar. It seems that now he is doing it again. Slavia Capital is the main shareholder of CZAW.
But don't take it from me. Here is the contact info for Slavia Capital.
Frank Nosek
Investment Banking / Director
SLAVIA CAPITAL Praha
Rytirska 13
110 00 Praha 1
Tel.: +420 221 181 062
Fax: +420 221 181 068
Mob.: +420 605 228 570
[email protected]
www.slaviacapital.com
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Hello.
I’ve included below the full text of the release written today by Sport Aircraft Works, regarding the March 27 filing by part-owner Slavia Capital. As is always the case, there is a story behind the story, and SAW is explaining its view of the circumstances.
It is good for us to note that shipments have escalated and continue, setting records for both February and March 2008, and that US deposits are held in the US; customer exposure seems to be minimized by prudent work by CZAW and the US Distributor, Sport Aircraft Works.
Danny Defelici (President, SAW) also assures me that he has made no changes in his plans to attend Sun ‘n Fun.
This kind of filing is never good news; but in this case it doesn’t look too bad, either. Do your homework (Czech laws differ from those of many other countries) before putting forward some of the wilder comments they’ve already heard.
This distribution has been delayed deliberately, to allow the company to make contact with customers, first.
Tim Kern
Tim Kern INK / 121five.com
PO Box 30
Anderson, IN 46015-0030
USA
863-651-6095
Below is the verbatim press release.
We feel that it’s important for you to know the facts about the current situation at Czech Aircraft Works.
Here is a brief history from our point of view.
• IN 2006 CZECH AIRCRAFT WORKS (CZAW) TOOK ON AN INVESTMENT PARTNER FOR 49% OF THE OUTSTANDING STOCK FOR THEIR PRODUCTION EXPANSION AND PURCHASE OF NEW FACILITY. THIS INVESTMENT CAME FROM SLAVIA CAPITAL (SC), SLOVAKIA BASED INVESTMENT FIRM.
• AFTER INITIAL HONEYMOON SC DECIDED THAT CHIP ERWIN’S (CZAW CEO) MANAGEMENT WAS NOT TO THEIR LIKING AND THEY PROMPTLY TOOK OVER CONTROL OF THE FACTORY. THE PERSONNEL THAT THEY PUT IN PLACE HAD NO AVIATION BACKGROUND AND BASICALLY STRIPPED THE COMPANY OF VALUED WORKERS BY FIRING THE BEST ONES. (I believe that the investors have a very different opinion on this)
• NOW IT’S CLEAR THAT DURING 2007 THE MANAGEMENT TOOK EVERY OPPORTUNITY TO MAKE THE WRONG DECISIONS AND RUN THE COMPANY FINANCIALLY INTO THE GROUND. TOWARDS THE END OF 2007 SC DECIDED THE COMPANY NEEDED ADDITIONAL FUNDS AND OFFERED GREATER DILUTION AT UNFAVORABLE TERMS TO THE EXISTING SHAREHOLDERS. CHIP ERWIN (PARTIAL OWNER) TOGETHER WITH THE REST OF THE SHAREHOLDERS REFUSED THIS OFFER AND CHIP TOOK CONTROL OVER THE FACTORY AGAIN. (Hard to believe that an investor would want to devalue his investment. I think that an investor would want to make the company more valuable so that the value of the investment would go up). Hard to believe that management would want to run the company into the ground as that is not a good way to protect your job and investment).
• AT THE SAME TIME SC STARTED A CAMPAIGN TO DISCOURAGE CZAW VENDORS FROM SELLING EQUIPMENT TO THEM AND SPREADING RUMORS OF IMMINENT BANKRUPTCY. ALTHOUGH THIS CAMPAIGN WAS DETRIMENTAL TO THE COMPANY, CHIP ERWIN WAS ABLE TO CONTINUE GROWING THE COMPANY OUT OF THE MESS THAT WAS CREATED. (Again, hard to believe that investors and management would want to hurt the company. Seems that Chip Erwin did not get along with anyone).
• IN THE BEGINNING OF 2008 FOR THE FIRST 3 MONTHS CHIP ERWIN PROVED THE COMPANY WAS VIABLE BY RUNNING THE COMPANY ON CASH FLOW WHILE PAYING SUBSTANTIAL LIABILITIES DOWN AT THE SAME TIME. THIS DEMONSTRATES THAT THE COMPANY IS VIABLE GOING FORWARD AND IS NOT INSOLVENT OR NEEDS BANKRUPTCY PROTECTION. (Not paying debt and vendor obligations is not a way to run a company. CZAW owes a lot of money to vendors and investors. )
• SC, THROUGH THEIR COLLABORATION WITH AN [AFFILIATED?] COLLECTION AGENCY, PETITIONED THE CZECH COURTS FOR BANKRUPTCY AND/OR RESTRUCTURING ON MARCH 27, 2008. IN OUR VIEW THIS WAS ANOTHER DIRTY TACTIC TO MAKE THE SHAREHOLDERS CAPITULATE IN GIVING UP FULL CONTROL OF A VIABLE COMPANY TO MINORITY SHAREHOLDER (SC). (Chip management style does not work well with others. I just does not make sense for a major investor to want to bankrupt a company. SC. It is Chip that wants to get rid of SC so that he can have it all to himself. He did this very well with Nextair years ago. Chip is hoping to purchase the assets of CZAW for almost nothing after it goes bankrupt. He will than have everything to himself which will include the aircraft designs, inventory and factory. Not a bad deal!!)
How does this affect us?
• IT’S CHIP’S UNDERSTANDING THAT IT TAKES 14 DAYS FOR THE BANK TO COMMENT ON THE RESTRUCTURING PETITION, AT WHICH TIME THE COURTS WILL DECIDE WHICH WAY TO GO. IT’S PROVEN FROM OUR FIRST THREE MONTHS OF 2008 THAT WE ARE VIABLE AND WE WILL PETITION THE COURT (IF IT GOES THIS FAR) TO CONTINUE OPERATING AS USUAL UNDER THE COURTS’ PROTECTION. THIS ACTUALLY WOULD BE GOOD FOR CZAW AS IT PROTECTS THEM FROM THEIR OWN INVESTMENT PARTNER. (I would say that Chip knows better than anyone on how the bankrupt laws work in the Czech Rep.)
• DELIVERIES SHOULD CONTINUE AS PLANNED. EVEN UNDER RESTRUCTURING THE COMPANY CONTINUES TO RUN AND MANUFACTURE. WE HAVE HAD TWO STRONG MONTHS (FEBRUARY AND MARCH 08) OF AIRCRAFT DELIVERIES WITH A TOTAL OF 16 AIRPLANES DELIVERED (CZAW SHIPPED 20 TOTAL IN MARCH). (Hard to believe that 20 aircraft were shipped in March. Total deliveries are 57 to date. See HTTP://WWW.SPORTAIRCRAFTWORKS.COM/PDF/L ... 012008.PDF ).
And just to reassure all our customers, we keep all of the deposits on this side of Atlantic. (how do we know that this is true???
To sum this up Chip Erwin has been using all of his resources (what resources? He has no money!) and energy to resolve the problems with Slavia Capital and continue to deliver one of the best LSA aircraft on the market.
Thank you for your continuing support.
Czech Aircraft Work (CAW) files for bankruptcy - Sportcruise
Moderator: drseti
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bob_anderson
- Posts: 8
- Joined: Mon Mar 31, 2008 2:32 pm
- Location: Atlanta
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bob_anderson
- Posts: 8
- Joined: Mon Mar 31, 2008 2:32 pm
- Location: Atlanta
It is official. CZAW is now officially bankrupt!
It is official. CZAW is now officially bankrupt! Danny and Chip have not been telling you the truth.
There is no way that people will get their money back on deposits. You need to read the latest documents from the court.
http://www.matronics.com/archive/archiv ... est.vol-aa
CZAW is now officially bankrupt. Chip Erwin and Danny need to be in jail!
Regional Court in Brno
Husova 15
601 95 Brno
File no. KSBR 44 INS 1207/2008
In Prague on 26 May 2008
XVII.
Conclusion
The Debtor (or its executive Mr. Ch. W. Erwin) is currently solving the dismal
situation of the company by selling work in progress (i.e. products which have
been allocated a manufacturing number and for which the customers have already
paid advances) to any customer who is willing to pay in cash (without delivering
the products to customers who have duly paid advances for them). The above
practices of the Debtor were supported by the submission of Mr. Leonardo do
Sayago of AEROMARINE, Lda, which was served on the insolvency court on 23 May
2008 (a Czech translation of this submission shall be presented by the Petitioner
to the insolvency court in the nearest future). The biggest customer with
whom the Debtor currently cooperates on this basis is Sprite Aviation.
By such conduct, the Debtor, or its executive, exposes himself to potential criminal
prosecution. At the same time, such conduct of the Debtor damages the assets
and significantly reduction possible satisfaction of the Debtor's creditors.
The Debtor currently lacks sufficient security of its manufacturing facilities,
due to which it is threatened by potential embezzlement and theft, resulting
in decrease of the assets from which the creditors should be satisfied.
The Petitioner believes that, based on the foregoing, it is in the interest of
all involved parties (creditors and members)
to appoint a preliminary insolvency trustee,
who will provide objective information about the Debtor's management and will ensure
further operation of the company within the necessary period in accordance
with the existing possibilities.
Such preliminary trustee should be charged, in particular, with taking steps necessary
to identify and to secure the Debtor's assets. Furthermore, the preliminary
trustee should be charged with a review of the Debtor's books of account
(which show a number of fundamental discrepancies). At the same time, it would
be appropriate for the preliminary trustee to direct the Debtor's conduct and
to handle the assets in a way preventing any further damage to the creditors
caused by the Debtor's conduct.
It is important that anyone involved with CZAW in any way read the details, which are posted at:
http://www.matronics.com/archive/archiv ... est.vol-aa
AIRCRAFT ENTERPRISES LTD.
holding 4515 votes, the member SLAVIA CAPITAL AERO (SC AERO) LIMITED holding
4965 votes, and the member Trihold Limited holding 540 votes. For any resolution
to be adopted, a 67% majority of all the votes of all members was always required.
What is important here is that Chip and Danny of Sport Aircraft Works are the owners of AIRCRAFT ENTERPRISES LTD. in Belize!!
There is no way that people will get their money back on deposits. You need to read the latest documents from the court.
http://www.matronics.com/archive/archiv ... est.vol-aa
CZAW is now officially bankrupt. Chip Erwin and Danny need to be in jail!
Regional Court in Brno
Husova 15
601 95 Brno
File no. KSBR 44 INS 1207/2008
In Prague on 26 May 2008
XVII.
Conclusion
The Debtor (or its executive Mr. Ch. W. Erwin) is currently solving the dismal
situation of the company by selling work in progress (i.e. products which have
been allocated a manufacturing number and for which the customers have already
paid advances) to any customer who is willing to pay in cash (without delivering
the products to customers who have duly paid advances for them). The above
practices of the Debtor were supported by the submission of Mr. Leonardo do
Sayago of AEROMARINE, Lda, which was served on the insolvency court on 23 May
2008 (a Czech translation of this submission shall be presented by the Petitioner
to the insolvency court in the nearest future). The biggest customer with
whom the Debtor currently cooperates on this basis is Sprite Aviation.
By such conduct, the Debtor, or its executive, exposes himself to potential criminal
prosecution. At the same time, such conduct of the Debtor damages the assets
and significantly reduction possible satisfaction of the Debtor's creditors.
The Debtor currently lacks sufficient security of its manufacturing facilities,
due to which it is threatened by potential embezzlement and theft, resulting
in decrease of the assets from which the creditors should be satisfied.
The Petitioner believes that, based on the foregoing, it is in the interest of
all involved parties (creditors and members)
to appoint a preliminary insolvency trustee,
who will provide objective information about the Debtor's management and will ensure
further operation of the company within the necessary period in accordance
with the existing possibilities.
Such preliminary trustee should be charged, in particular, with taking steps necessary
to identify and to secure the Debtor's assets. Furthermore, the preliminary
trustee should be charged with a review of the Debtor's books of account
(which show a number of fundamental discrepancies). At the same time, it would
be appropriate for the preliminary trustee to direct the Debtor's conduct and
to handle the assets in a way preventing any further damage to the creditors
caused by the Debtor's conduct.
It is important that anyone involved with CZAW in any way read the details, which are posted at:
http://www.matronics.com/archive/archiv ... est.vol-aa
AIRCRAFT ENTERPRISES LTD.
holding 4515 votes, the member SLAVIA CAPITAL AERO (SC AERO) LIMITED holding
4965 votes, and the member Trihold Limited holding 540 votes. For any resolution
to be adopted, a 67% majority of all the votes of all members was always required.
What is important here is that Chip and Danny of Sport Aircraft Works are the owners of AIRCRAFT ENTERPRISES LTD. in Belize!!
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susan_adams
- Posts: 2
- Joined: Wed Jun 18, 2008 10:59 am
- Location: Palm City, Florida
UNBELIVABLE
Bob,
I can't believe you would post and say the things you did here. I have only known you for a few short months while working here at SAW but I really had a different opinion of you than this.
First of all CZAW IS NOT BANKRUPT. All you did was post the opposing sides "arguments and lies" of course they are going to say negative things, they are trying to ruin the company.
I can't believe you said people were going to loose their deposits, you know as well as I do the money is in our escrow account here in the US and Danny has honored any and all request for returns of deposits, which I am glad to say has been small due to the fact that we are delivering the amount of planes we are.
Danny is in Czech now checking things out, the court situation will be resolved in the next couple of weeks and it is looking very positive. He sent pictures of a working factory with planes on the assembly line (doesn't sound like a bankrupt company to me)
I am sure you are upset that your contract with SAW was not renewed but it doesn't warrant stooping so low as to send out rumors and lies as fact.
If any customers of SAW are concerned or worried they should feel free to contact either myself, Dan Coffey or Danny Defelici, we won't hide behind words but will honestly tell you where the status is and the amount of planes being delivered.
Thank all for letting me reply
Susan Adams
Sport Aircraft Works, Inc.
I can't believe you would post and say the things you did here. I have only known you for a few short months while working here at SAW but I really had a different opinion of you than this.
First of all CZAW IS NOT BANKRUPT. All you did was post the opposing sides "arguments and lies" of course they are going to say negative things, they are trying to ruin the company.
I can't believe you said people were going to loose their deposits, you know as well as I do the money is in our escrow account here in the US and Danny has honored any and all request for returns of deposits, which I am glad to say has been small due to the fact that we are delivering the amount of planes we are.
Danny is in Czech now checking things out, the court situation will be resolved in the next couple of weeks and it is looking very positive. He sent pictures of a working factory with planes on the assembly line (doesn't sound like a bankrupt company to me)
I am sure you are upset that your contract with SAW was not renewed but it doesn't warrant stooping so low as to send out rumors and lies as fact.
If any customers of SAW are concerned or worried they should feel free to contact either myself, Dan Coffey or Danny Defelici, we won't hide behind words but will honestly tell you where the status is and the amount of planes being delivered.
Thank all for letting me reply
Susan Adams
Sport Aircraft Works, Inc.
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bob_anderson
- Posts: 8
- Joined: Mon Mar 31, 2008 2:32 pm
- Location: Atlanta
Bob, you are correct about CZAW. They need to be in jail!!
Susan Adams,
Shame on you for continuing to not tell the truth. Here is an email from one of your customers that Chip knows very well.
Hi Bob, Thanks for your message.Chip Erwin nearly convinced me to buy 9 % of CZAWfor $800 000. He convinced (by deceiving an old friend )Slavia Capital to putin $2.4 million.The idea is that it would be 9% for me 40% for SC he would retain control and get $3.4 million but had to be content with$2.4million. My accountant smelt a rat right away. People are wondering where the money has gone ! I knew he was a very tricky dicky but never thought he would steal my OC3989from under my own eyes. The Police in Czeck Rep. unfortunately could not prevent the theft. Until it happens there is no crime. Sounds crazy but it is like that. The worst thing is that the plane was for a client/friend who had been waiting 2 years . He is very upset and I am even more because the plane wasfully paid (he hates to deliver this type of plane--does not help his cashflow !!). He forced me to sign a new agreement which I did to salvage something as Iknow CZAW will be history soon.The Police advised me to do it. I am sending this info to a few friends and colleagues and you may do the same. Of course he will put it around I am also part of a big conspiracy. Regards Leonardo SayagoAeromarine Lda Eng. Leonardo SayagoAeromarine, Lda.Monte do LagoMontargil - PortugalMobile: 00351917505520www.aeromarine.eu
For proof of what Leonardo is saying, see the detailed emails between him and Chip at: http://forums.matronics.com/viewtopic.php?t=41584
2 PDF files are available for downloading.
Shame on you for continuing to not tell the truth. Here is an email from one of your customers that Chip knows very well.
Hi Bob, Thanks for your message.Chip Erwin nearly convinced me to buy 9 % of CZAWfor $800 000. He convinced (by deceiving an old friend )Slavia Capital to putin $2.4 million.The idea is that it would be 9% for me 40% for SC he would retain control and get $3.4 million but had to be content with$2.4million. My accountant smelt a rat right away. People are wondering where the money has gone ! I knew he was a very tricky dicky but never thought he would steal my OC3989from under my own eyes. The Police in Czeck Rep. unfortunately could not prevent the theft. Until it happens there is no crime. Sounds crazy but it is like that. The worst thing is that the plane was for a client/friend who had been waiting 2 years . He is very upset and I am even more because the plane wasfully paid (he hates to deliver this type of plane--does not help his cashflow !!). He forced me to sign a new agreement which I did to salvage something as Iknow CZAW will be history soon.The Police advised me to do it. I am sending this info to a few friends and colleagues and you may do the same. Of course he will put it around I am also part of a big conspiracy. Regards Leonardo SayagoAeromarine Lda Eng. Leonardo SayagoAeromarine, Lda.Monte do LagoMontargil - PortugalMobile: 00351917505520www.aeromarine.eu
For proof of what Leonardo is saying, see the detailed emails between him and Chip at: http://forums.matronics.com/viewtopic.php?t=41584
2 PDF files are available for downloading.
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susan_adams
- Posts: 2
- Joined: Wed Jun 18, 2008 10:59 am
- Location: Palm City, Florida
truth
I am not going to get into any arguments with you or anyone else. This is one person that apparently had some bad dealings with Chip but do we know the whole story.
There is not shame on me as I am telling the truth of all I know going on right now with CZAW and with SAW. For the short time I have known Danny I see the honest, caring person he is and Zaneta (his wife) is. They truly care about their customers and people around them.
I see the planes sitting out here in front of me that we are delivering, I saw the pictures of the assembly line Danny just sent (should be on www.sportaircraftworks.com soon if not already). I see the paper work being sent to me from CZAW and customs of planes on the water. I see the container sitting right outside the hanger this morning and the guys working to unload the 2 craft on there off.
I know the courts have not declared anything as of today.
I am also the bookkeeper here and I know where the $s are.
That is the truth and anyone is welcome to come visit and see for themselves.
and just on a side note, the customer you have above here was not a SAW customer (he is in the EU)
Susan Adams
Sport Aircraft Works.
There is not shame on me as I am telling the truth of all I know going on right now with CZAW and with SAW. For the short time I have known Danny I see the honest, caring person he is and Zaneta (his wife) is. They truly care about their customers and people around them.
I see the planes sitting out here in front of me that we are delivering, I saw the pictures of the assembly line Danny just sent (should be on www.sportaircraftworks.com soon if not already). I see the paper work being sent to me from CZAW and customs of planes on the water. I see the container sitting right outside the hanger this morning and the guys working to unload the 2 craft on there off.
I know the courts have not declared anything as of today.
I am also the bookkeeper here and I know where the $s are.
That is the truth and anyone is welcome to come visit and see for themselves.
and just on a side note, the customer you have above here was not a SAW customer (he is in the EU)
Susan Adams
Sport Aircraft Works.
It's a shame this is effecting the Sportcruiser it's a very nice LSA in all aspects. But if I'm betting with my money as anyone who aquires an aircraft from a fairly new company . I'm gonna believe Bob every day of the week & twice on Sunday . IMHO when u purchase a plane your really buying part of the company & I could'nt imagine who would want to buy into this company , especially at this stage of the game. Even if Bob is only half right on his posts this is a scary proposition for any potential owner .
Opinions are like armpits everybody has a couple & they usually stink .
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bob_anderson
- Posts: 8
- Joined: Mon Mar 31, 2008 2:32 pm
- Location: Atlanta
Lawsuit against CZAW
Lawsuit against CZAW. Seems that there is a lot more to CZAW’s problems. I got an email from a guy in the UK about a Mr Ronfell. Ronfell is suing CZAW for an aircraft built by CZAW. There are corrosion problems etc.? Aircraft was inspected by the authorities and was grounded as unsafe. This is a new aircraft that CZAW delivered. How many other lawsuits are there against CZAW?
Fallout???
The website for Northeast Light Sport Aircraft, 7B3, North Hampton, NH, advertised Sport Pilot Training in one their two CZAW SportCrusiers, Ground School and also SportCrusier sales. They had a page showing a SportCrusier starting starting at $85,000. Now that page no longer says $85,000 but, rather, "2 Aircraft Available, call for details". They also no longer advertise that they offer sport pilot training or ground school.
Maybe they got caught up in this backruptcy business.
Drats, that was the closest Sport Pilot training around here and that was more than an hour away!
Maybe they got caught up in this backruptcy business.
Drats, that was the closest Sport Pilot training around here and that was more than an hour away!
Re: Fallout???
[quote="CESantos"]The website for Northeast Light Sport Aircraft, 7B3, North Hampton, NH, advertised Sport Pilot Training in one their two CZAW SportCrusiers, Ground School and also SportCrusier sales. They had a page showing a SportCrusier starting starting at $85,000. Now that page no longer says $85,000 but, rather, "2 Aircraft Available, call for details". They also no longer advertise that they offer sport pilot training or ground school.
Maybe they got caught up in this backruptcy business.
Drats, that was the closest Sport Pilot training around here and that was more than an hour away![/quote]
Check this part of their website:
http://www.northeastlsa.com/SPT_Sport_Pilot_Course.html
Maybe they got caught up in this backruptcy business.
Drats, that was the closest Sport Pilot training around here and that was more than an hour away![/quote]
Check this part of their website:
http://www.northeastlsa.com/SPT_Sport_Pilot_Course.html
Check this part of their website:
http://www.northeastlsa.com/SPT_Sport_Pilot_Course.html
That's the page I'm used of seeing. However, I see no link to it from their Home page. The link appears to have been removed. How did you get there? Did you have it cached?[/quote]
http://www.northeastlsa.com/SPT_Sport_Pilot_Course.html
That's the page I'm used of seeing. However, I see no link to it from their Home page. The link appears to have been removed. How did you get there? Did you have it cached?[/quote]
Susan, I don't know who "bob_anderson" is, but you can rest assured that he is not the Bob Anderson who formerly worked at Sport Aircraft Works, whom I just talked with a few minutes ago. Bob is the person you remember, not the person who posts this "information" on the forum. If someone wanted to spread lies about SAW, could choose any name he wished, wanted to remain anonymous, and didn't care who's reputation was wrongfully harmed, Bob's name would be a logical choice.
"bob_anderson", if that's your name and you're actually an engineer from Atlanta, that should be easy for you to sustantiate as I live in Atlanta, too. Until that time, I believe you're an impostor.
"bob_anderson", if that's your name and you're actually an engineer from Atlanta, that should be easy for you to sustantiate as I live in Atlanta, too. Until that time, I believe you're an impostor.
IMPORTANT NOTE FROM ADMINISTRATOR
Please be advised that bob_anderson IS NOT the same Bob Anderson who was formerly the director of sales and marketing at Sport Aircraft Works.
GeraldZ,
Administrator
GeraldZ,
Administrator
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bob_anderson
- Posts: 8
- Joined: Mon Mar 31, 2008 2:32 pm
- Location: Atlanta
CZAW
Amazing. Have I ever said that I am a different Bob Anderson? The problem is not me. The problem is that CZAW and more specifically Mr Chip Erwin is ripping off honest people. You read the court papers and you read what people have to say about him. The press is not taking this on, so all I want to do is to advise people out there. Again, don't take it from me. Read the documents and letters from others about Chip and CZAW.