Fraud Suit Targets San Diego Firm, O.C. Accountant

An Orange County accountant who became chief financial officer for an upstart technology company is embroiled in a fraud lawsuit with a couple he advised to invest in the company.

The suit was filed in San Diego federal court last month by Texas investor John Littlejohn. It centers on Basic Research Corp. of San Diego, which developed satellite broadcast, loudspeaker and motor technologies, and Basic’s founder, Konstantenos H. Hronopoulos.

Costa Mesa accountant Richard G. Boyer, the company’s chief financial officer, also was named as a defendant.

Littlejohn and his wife, Susan, claim $3 million was diverted improperly from Basic to such uses as motor homes, Nieman Marcus shopping sprees and financing for Hronopoulos’ $1.6-million home. They say Hronopoulos and associates misled them about the ownership and viability of the technologies and concealed Hronopoulos’ 1983 guilty plea to tax and securities fraud.

Basic’s lawyer, Robert D. Rose of San Diego, didn’t immediately return a call seeking comment Thursday.

The suit contends that Boyer concealed his own interests in Hronopoulos’ ventures while encouraging the Littlejohns, who had been clients of his, to invest in them. It also says Boyer knew about some fund misappropriations but didn’t tell the Littlejohns.

“Mr. Littlejohn put a lot of faith in Mr. Boyer,” expecting him to be “another pair of eyes and ears for him,” said attorney William Braniff, who filed the lawsuit. “And it turned out that Mr. Boyer was not playing that role.”

Boyer, an international tax and finance specialist, was out of the country on unrelated business this week and couldn’t be reached for comment. Associates said he believes all important information was fully disclosed in writing to the Littlejohns, whom he regarded as good friends.

“This must be a misunderstanding. He is as honest as the day is long,” said Orange County Treasurer John M.W. Moorlach, a longtime colleague of Boyer at Balser, Horowitz, Frank & Wakeling in Costa Mesa. “I could put my entire life savings in his hands and not lose a minute’s sleep.”

Boyer left the Balser firm in December 1997 when he went to work for Basic. Balser also is a defendant in the lawsuit. A lawyer for the firm declined comment, saying he hasn’t fully investigated the allegations.