HAMPTON, N.H. (AP) – Creditors of a bankrupt textile company in Hampton want to do their own investigation into allegations that the former CEO misled investors about the company’s finances.
Foss Manufacturing filed for bankruptcy in September after its chief lender cut off credit, alleging that the company fraudulently borrowed millions of dollars to benefit itself and company insiders.
Now, the company’s creditors have asked the bankruptcy judge to let them investigate not only former CEO Stephen Foss but his wife and daughter.
The group says its preliminary investigation shows Foss was using money from the company like a personal piggy bank, paying for home improvements and club memberships.
A hearing on whether the creditors will be allowed to conduct the investigation will be held Thursday in federal bankruptcy court in Manchester.
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