John B. Torkelsen’s lavish offices on Vaughn Drive had light oak parquet floors, built-in light oak cabinets, simulated oak ceiling beams, and a unique mirror design — mirrors that bounced off mirrors, as many as five lined up so those in the executive office could see around corners.
The luxury of this office paled when compared to Torkelsen’s home on an acre of land in Princeton’s expensive Western section. It had 17 rooms, including seven bedrooms, 7.5 baths, a 35-foot living room, two solariums, a pool, and a two-story luxury cabana with a Lalique glass-paneled staircase.
On June 22 Torkelsen checked into the Federal Correctional Institution in Morgantown, West Virginia, a minimum security prison. He had been sentenced to 70 months in prison on one criminal charge: Making false statements to the U.S. Small Business Administration on February 10, 2002. He must also pay more than $1.9 million in restitution to the SBA and be subject to five years supervision after he is released.
Next week Torkelsen is scheduled to receive his work assignment, which might be groundskeeping, food service, orderly work (cleaning), plumbing, or painting, but he could also be assigned to tutor a fellow inmate. Inmates can take vocational training in computers, graphics, or welding. According to a Forbes article on “Best Prisons,” the facility also offers classes in leatherwork, wood carving, and art.
Formerly the Kennedy Center for troubled juveniles, Morgantown was converted to a federal prison in 1969. It has several dormitory-style housing units and it also has some two-person rooms. Most of the 1,300 male inmates are here for drug offenses, according to Veronica Fernandez, public information officer. She notes that though Torkelsen’s sentence is 70 months, he might get that sentence reduced for good behavior.
A minimum security prison has the most relaxed rules in the federal system, yet the regulations for visitors seem restrictive. Visitors may not wear khaki clothing or sleeveless blouses, and they may bring only three items: a small clear change purse, $20 in currency to use in vending machines, and nitroglycerine pills.
The prison is a couple of hours away from the facility where Martha Stewart served her time. Earlier Torkelsen had been slated to go to the minimum security prison in Fairton, New Jersey, 92 miles south of Princeton.
Torkelsen and members of his family had been charged with the theft of $1.9 million of Acorn Technology Fund monies and the misapplication of $32 million in federal funds. Before starting the fund Torkelsen was an expert witness who valued technology companies for plaintiff securities firms, particularly Milberg Weiss. Torkelsen was convicted in November, 2005.
Pamela Torkelsen, his 44-year-old wife, has pleaded guilty to interstate transportation of stolen or fraudulently obtained property. With this plea the former owner of an antique shop in South Carolina agreed to cooperate with prosecutors in the investigation of alleged theft of more than $1.9 million in company funds. Torkelsen’s son Leif was named in a civil complaint, along with his father.
John Torkelsen had been a favorite expert witness for Milberg Weiss attorney William Lerach, the recognized king of shareholder class-action suits. His former company, Princeton Venture Research, provided valuations and appraisals of both public and private companies, primarily for the financing of small technology companies. Torkelsen had funded at least three Princeton firms — Mikros Systems Corp., Princeton Video Image, and VeriVoice. At one point he had 47 people on Vaughn Drive plus an office in San Diego.
The Torkelsens’ 6,000 square-foot home on Library Place brought just under $3.5 million at a sheriff’s sale.
‘The history of the world has been changed by very small factors,” says David Wanetick, CEO of a Forrestal Village-based executive education firm, Incremental Advantage. “Hitler was almost run over by a truck.”
Also, says Wanetick, the leading partner in a law firm may earn five times as much as his cohorts, but he cannot work five times as hard as they do. It must be the star’s “incremental advantage,” the “little extra something,” that makes the difference.
Wanetick uses the “very small factor” stance in his pitches to high level executives, who are notoriously very difficult to educate because they already know so much — or think they do. His company stages 25 conferences and seminars on a variety of topics for executives from all over the world. Costs range from $800 to $1,200.
“If we can give these executives a little advantage, that is magnified several fold,” say Wanetick. His 10-person firm moved in June from Manhattan to Princeton Forrestal Village and is hiring a marketing person and a conference sponsorship director. Bill Barish of Commercial Property Network represented Wanetick in the lease negotiations. For his IT paraphernalia, he turned to Princeton Computer Support, and Office Furniture by Barringer is providing the other furnishings.
The son of a surgeon in San Francisco, Wanetick majored in economics and political science at Bucknell, Class of ‘88. He worked for Merrill Lynch in New York, then went off on his own, focusing on research, to do his own publications and newsletters. He wrote two books on the method of conducting industry analyses and taught this subject for 11 years; he has lectured internationally and has made three appearances in Kuwait.
If you want to know the metrics to evaluate pharmaceuticals, says Wanetick, you need different tools from those used to analyze an oil company. “Mine are the only two books that walk investors through these,” says Wanetick.
“I concluded that what was taught in business schools is too generic. When I applied to teach at the New York Institute of Finance, I didn’t know what I wanted to teach but I showed them research — I had broken down my notes into different industries, such as pharma, energy, and retail. ‘Just walk them through your notes,’ was the dean’s reply, and we developed a course called industry analysis.” At that time he was writing the book, and it was synergistic — the book fed his lectures, and vice versa.
Detailed industry analysis, Wanetick claims, is still not taught in business schools. “It is extremely difficult to grasp or to give real life examples,” he says. One instructor would have to be up on many different industries that are constantly changing. Most analysts spend their careers in the same industry. And students don’t necessarily want to apply themselves that much. “In the real world you have to do original thinking and that is not always what students want to do.”
Senior level executives, on the other hand, welcome such challenges. “Teaching them is part entertainment, but they are demanding, and they want real life examples.”
Wanetick’s business used to be partnered with the Wall Street Transcript. Before that, it was housed with the New York Society of Security Analysts at the World Trade Center.
“We believe that Princeton is close enough to New York and Washington to provide us with a very high-caliber talent pool. As a research-centric business, access to a highly educated labor market is of critical importance,” says Wanetick.
IncreMental Advantage, 116 Village Boulevard, Suite 309, Princeton 08540; 609-919-1895; fax, 347-438-3218. David Wanetick, managing director. www.incrementaladvantage.com
Randolph Hanks has left Wachovia Bank to found First Choice Bank, the first new community bank in Mercer County since 1999, and he aims to open on Whitehead Road in Lawrenceville. First Choice Bank is in the organization stage, having made its application to the state, and it is rehabbing a building formerly occupied by Fleet Bank.
As Wachovia’s director of business banking, Hanks met the movers and shakers who have invested from $50,000 to $200,000 toward the $1,500,000 required by the state to establish the bank. They exceeded the minimum, reaching $1,750,000.
If Princeton’s track record prevails, the organizers can expect a good return. “Carnegie Bank and First Washington, for instance, had healthy returns — it’s been a good market for small banks in Mercer County and New Jersey overall,” says Hanks. And the next newest bank in Mercer County, Hopewell Valley Community Bank, opened in 1999 and now has five locations.
The organizers who will also serve on the board: Herbert Ames, former county economic development director and now with the Devin Group; Steven Doerler of Doerler Landscapes; Nancy Dudas of Innovative Commercial Interiors; Geoffrey Morsell of Sharbell Development; Matthew Pribila of WithumSmith+Brown; James Radvany of Source One Services; Luis Rivera of Avila Construction; Munish Sood of Princeton Advisory Group; Charles Stines of KQI Marketing Group; and Richard Weise of Xerographic Document Solutions. Also investing are Gregory Blair of Nottingham Insurance; David Fried of Tricor and also the mayor of Washington Township; Michael Mann of Pepper Hamilton; and Gregory Scozzari of the construction firm V.J. Scozzari and Sons.
Hanks, the son of a U.S. Army sergeant first class who won a Bronze Star in Vietnam, graduated in 1988 from Rider University and began working for what was then called New Jersey National and is now Wachovia. He and his wife, Judy, have one son.
Hanks follows Sean Murray out the Wachovia door. Murray had left a job as Wachovia’s director of wealth management to open Wilmington Trust’s Princeton office (U.S. 1, June 21). The grand opening for First Choice will be later this year.
First Choice Bank (in Organization), 669 Whitehead Road, Lawrenceville 08648; 609-462-2684; fax, 609-631-8803. Randolph Hanks, president and CEO. Home page: www.firstchoice-bank.com
Philadelphia Insurance has moved from 3525 Quakerbridge Road, Ibis Plaza, to Lenox Drive, going from 25 to 33 workers, and from 4,500 feet to 6,500 feet, With $2 billion in assets, it has 37 branches in 32 states, but has its headquarters in Bala Cynwyd, Pennsylvania. Of the 33 employees here, seven are in sales.
The firm writes commercial property and casualty insurance and it focuses on health clubs, nonprofit groups, schools, hotels, shopping centers, and professional liability for lawyers and accountants. In addition to the usual areas, such as employment practices liability, discrimination, sexual harassment, and wrongful termination, it provides identity theft, workplace violence, specialized loss control services, and terrors in travel reimbursement coverage.
“Over the last 10 years, it has been one of the most profitable companies in America,” says Brian O’Reilly, regional vice president, “because we offer value added coverages in specific niches. We are competitive, but not the cheapest game in town.”
A native of Hamilton Township, O’Reilly was a history major at Lafayette College, Class of 1990, and has been with the firm for 16 years. He and his wife, Chris, went to Notre Dame High School. They have a school-aged son and daughter. One of O’Reilly’s two sisters works at New Jersey Manufacturers.
“I was looking for a job out of Lafayette, and they were looking for young sales reps,” he says. “I interviewed with Jim Maguire, founder of the company which he had started as a one-man agency in 1962.” At Metropolitan Life, Maguire had made his reputation as a young salesperson by learning sign language, and he set records selling to the hearing impaired. “He found a niche within the life insurance industry, and that is how he built this company — by getting into niche businesses.”
“We are the premiere writer of nonprofit organizations and health clubs nationally,” says O’Reilly. “We insure a board for the decisions they make. For a nonprofit, most of the exposure is for is employment-related practices, sexual harassment, and discrimination.” O’Reilly’s own special niche is the nonprofits. They need training for everything from how to avoid abuse and molestation issues to how to safely drive a 15-passenger van. “We do schools and daycare centers, and we found out we that included some churches, so we just started a church program in the last year.” At the firm’s website www.losscontrol.com) clients can get training manuals and aids to help them manage their exposures.
Chris Biedenback of Brandywine represented the landlord, and John Comp of NAI Fennelly represented the tenant.
“The average client stays with us for 10 years, and we have zero debt on our balance sheet. The only thing that could hurt us is writing bad business, and we are tough up front,” says O’Reilly. Unlike one of its competitors, New Jersey Manufacturers, it does not write workers compensation. Says O’Reilly: “It is a tough area to be profitable in.”
Philadelphia Insurance Companies (PHLY), 1009 Lenox Drive, Suite 107, Lawrenceville 08648; 609-512-3140; fax, 609-512-3141. Brian O’Reilly, regional vice president. www.phly.com
Lt. Keith J. Hillman, 40, on July 5. He was a lieutenant in the West Windsor police department.
Michel Jean Martin, 62, on July 14. He was a vice president at Huber Inc. in Havre De Grace, Maryland, and had been CEO of U.S. operations for SNPE Inc. on College Road East.