All of us investors in GGC have heard Li’l Kenny Johnson say time and again that he never took a salary from GGC. Other than maybe GGC Investor Jerry Folta, we don’t know anyone who believes it. But Li’l Kenny having read Goebbels when he was a kid keeps saying it over and over, “I never took a penny from GGC.”
We won’t bother going into all the stories of Johnson carrying a backpack full of cash, making huge cash withdrawals from the bank, stuffing cash all around the dashboard of the GGC Jeep or going to the casinos to gamble with our money. Let’s just look at his own words. On March 13, 2013 Johnson sent an email to his erstwhile partner, Jeff Berwick. He wrote:
“GGC has paid me about $10-12k, which is two months, or less, of pay. I am taking a $6k salary and writing off the condo [in Las Condes] as our office…”
Hmmm. “Writing off the condo…” We think we’ll leave that as the subject of another post.
In addition to the above smoking gun, here’s a conversation Johnson might not remember.
Josh Kirley: Now, you say you’ve been paid nothing. You literally haven’t paid yourself at any point during this…?
Ken Johnson: I did this year. I paid myself this year.
Kirley: Am I allowed to ask what you’re paying yourself?
Johnson: I paid myself this year…. ah… what was the total? about… about $60 grand this year, last year probably ….
Kirley: [interrupting] and is that…. does that mean you worked for free last year?
Johnson: I have contracts. I have notarized contracts. I just haven’t taken the money. I took some of the money this year, so…
Wow. This conversation occurred in June 2014. It looks like Li’l Kenny gave himself a raise, quite a hefty one at that–almost 70%. He must have been doing a great job.
Here’s another tidbit, this from the only accounting firm to work for GGC, for about 10 minutes since they weren’t paid. In the notes to the 2013 accounting statements we find this:
“There is no salary recorded for the manager of the company, but apparently Mr. K Johnson has been withdrawing monies as his remuneration. This situation should be regularized by the appropriate documents (contracts) and making the relevant taxes and social security payments.”
Tsk, tsk. It appears that not only is Li’l Kenny lying to us investors about not being paid, he was not paying his taxes, too. We are shocked to hear it, because in his interview with The Economist, he was quoted as saying, “We pay our taxes. We obey the law.” See for yourself: