The first meeting of creditors in the bankruptcy proceeding of companies owned by get-rich-quick guru Don Lapre is scheduled for Aug. 17 at 1:30 p.m. at the Office of the U.S. Trustee in Phoenix.
Lapre’s infomercials for his money-making plan were consistently ranked among the Top 10, as determined by Jordan Whitney Inc., Tustin, CA, an infomercial monitoring service.
There are at least 30 unsecured creditors who claim they are owed money from Lapre since he filed for bankruptcy June 29. The trustee in the case was not named at press time.
The creditors listed in the bankruptcy filing claim they are owed about $2.7 million. The list did not include media-buying agencies and broadcast stations, which may increase the number of claims against Lapre’s company, Tropical Beaches Inc., and its subsidiaries, Dolphin Media, Don’s Making Money, New Strategies and National Reminder Service.
Among the issues that may be discussed at the creditors meeting is how Lapre lost $4 million in a failed Mexican real estate deal, according to a creditor who requested anonymity.
Lapre blamed the loss for his company’s financial woes in a letter he sent to creditors. He was unavailable for comment and his attorney C. Taylor Ashworth did not return numerous phone calls made to his office.
Sandra Daly, media director of Dolphin Media, told DRTV News that Lapre had invested his own money in the Mexican land project in an attempt to make money during the summer months, which are traditionally slow for the infomercial industry.
In his letter to creditors, Lapre also said the company made a mistake in transferring salespeople from successful campaigns to an Internet campaign that began in early May.
“It was the biggest mistake this company ever made,” Lapre said in the letter. “It put us in the hole by over $3 million. Our company makes $50 to $70 million dollars a year with a $3 to $6 million profit.”
Daly said the Internet campaign generated bad leads.
“The Internet created leads, but they were not as strong as they could be,” Daly said. “The show was making money for nine years but the back end of the Internet was not as strong as we hoped.”
After the Internet strategy failed, Lapre downsized the company. He also asked creditors to be patient and allow him time to pay them back with interest. He said the payments would be wired into the creditors’ accounts. He also said that to pay back the creditors in full would take eight or nine months.
“If our creditors demand more than this company can afford it will collapse the company and everyone will lose,” he said in the letter. “We are doing everything possible to make this work for everyone!! We have achieved great success trimming the costs and making this work.”
In the infomercial, Lapre explains how he went from rags to riches after he was unemployed because of a disability. He came upon the idea that if he sold products in classified ads throughout the nation, he could make a lot of money. He began marketing his moneymaking technique in 1990 and founded Tropical Beaches Inc.