A Baton Rouge native profiled last year in Business Report for inventing a tiny tracking device to locate everything from missing persons to handguns is caught up in an embezzlement scandal related to a shopping center he developed in Florida.
Clark East, the founder of tracking device startup TracFind, is accused of embezzling roughly $828,900 from proceeds that were part of a bankrupt estate and owed to a Midwestern bank. East was indicted by a Florida grand jury in December.
According to a news release from the U.S. Attorney’s Office for the Middle District of Florida, East received a loan from Stearns Bank to develop Ulmerton Road Plaza, a shopping center at 37000 Ulmerton Road in Clearwater, Florida.
East allegedly defaulted on the loan and received approval from the bank to sell the property in foreclosure in 2012, the release says. However, the day before the foreclosure sale, he filed for bankruptcy protection through his company, 3700 Ulmerton Road LLC.
A Florida court subsequently ordered him to sell the property and pay Stearns Bank $1.2 million, the release says. But instead of paying the bank, Stearns is accused of embezzling a portion of the proceeds.
East, a longtime shopping mall developer, tells Daily Report that he was a managing partner in the shopping center and was responsible for receiving the funds from the buyer to close out the venture.
East says he used a portion of the funds to pay off other real estate debts, and is working with attorneys to resolve the legal issue.
The indictment, he adds, is not connected in anyway to TracFind. East deferred other questions to his Florida-based attorneys, Hebert Law Group.
An indictment is a formal charge and not an indication of a defendant’s guilt or innocence.
—Alexandria Burris
