Coopers & Lybrand Accountant Axed in Death Row Debacle
A Los Angeles accountant accused by Death Row Records of stealing $4.5 million was fired Friday for alleged unethical business practices.
Coopers & Lybrand said it found nothing to support allegations that Steve Cantrock, a partner in its prestigious Gelfand, Rennert & Feldman entertainment division, took funds from Death Row. The company said Cantrock was asked to resign after “an extensive internal investigation and the discovery that Mr. Cantrock violated firm operating policies and its strict standards regarding ethical business practices.”
A spokesman for the firm declined to elaborate, and Cantrock could not be reached for comment.
The 43-year-old accountant has been in hiding since October, after signing a handwritten $4.5-million IOU to Death Row owner Marion “Suge” Knight. Sources close to Cantrock say that he was threatened by Knight and forced to get down on his knees before he agreed to sign the two-page confession, which was drafted on the spot by Knight’s attorney, David Kenner--an accusation that both Knight and Kenner deny.
Cantrock is now cooperating with the Justice Department, which is attempting to build a racketeering case against Death Row based on its alleged links to street gangs, drug trafficking, money laundering, violent acts, extortion and gunrunning.
Justice Department officials have routinely declined to comment on the probe. Law enforcement sources said, however, that phones have been tapped and agents from the FBI; Internal Revenue Service; Alcohol, Tobacco and Firearms; and the Drug Enforcement Administration, as well as police in Los Angeles and Las Vegas, continue to investigate a variety of leads.
Last month, federal agents interviewed Cantrock at length. FBI agents subpoenaed and collected reams of documents from Coopers & Lybrand detailing Death Row’s financial dealings over the last three years. Cantrock’s dismissal for alleged ethical problems could damage his credibility as a witness should he be called to testify in front of a grand jury.
The controversy swirling around Cantrock also raises questions as to how one of the nation’s major accounting firms ended up doing business with a record company under investigation for being an alleged criminal enterprise.
Sources said that Coopers & Lybrand was not aware of any problems at Death Row until Cantrock told executives in October that he was afraid for his safety and asked the firm to help him and his family go into hiding.
The firm immediately launched an extensive investigation into Cantrock’s handling of the Death Row account to determine whether any of Death Row’s allegations had merit. Information gathered from the internal investigation, which is still ongoing, indicated that Canttrock had been involved in questionable dealings--and he was asked to resign.
Coopers & Lybrand refused to detail what unethical business practices Cantrock allegedly engaged in during his three years of handling the Death Row account.
Cantrock had been at Gelfand, Rennert & Feldman for 15 years.
Knight contends that Cantrock bilked him of millions of dollars, much of which allegedly vanished last year after Cantrock promised to help the rap mogul launch a nightclub in Las Vegas. The club is now being probed by investigators for connections to a variety of individuals, some of whom allegedly have past connections to organized crime.
Cantrock’s accounting work in the music business began to accelerate in the late 1980s when he landed a top rock act named Slaughter. He was his firm’s top accountant in the music field until his departure, but there have been other questions regarding his accounting practices in recent years.
Tony Star, who owns a tiny Los Angeles rap label, told The Times that Cantrock promised in 1995 to get him a distribution deal with a major record conglomerate. Star said he approached Cantrock primarily because he represented Death Row, the nation’s top rap label.
Cantrock never approached Knight or anyone at Death Row about Star’s deal, but apparently pitched it to several entertainment attorneys, including East Coast lawyer Richard Herman, who was also involved in Death Row’s Las Vegas nightclub venture.
Herman promised Star he would use his contacts to secure a distribution deal if Star would invest money in a New York nightclub, according to a Nov. 30, 1995, letter obtained by The Times.
In an interview, Star said that Herman wanted him to invest in Scores, a topless nightclub that Herman represented, which is currently under investigation for alleged ties to organized crime.
In Los Angeles, one prominent attorney, speaking on condition of anonymity, said he stopped using Gelfand, Rennert & Feldman last year because four of his rock act clients had concerns about Cantrock’s accounting techniques.
A spokesman for Coopers & Lybrand declined comment.
