Theodore Toloff, Falsifying Financial Documentation, Michigan 2024

DETROIT – Theodore Toloff, a 65-year-old man from Northville, Michigan, was sentenced to 1 year and 1 day in prison, followed by 2 years of supervised release, for providing a financial institution with false documentation in connection with a bank loan, announced United States Attorney Dawn N. Ison.

The sentencing took place on February 14, 2024 in the United States District Court for the Eastern District of Michigan.

Toloff entered his guilty plea in January before United States District Judge David M. Lawson. According to court records, Toloff served as the Chief Financial Officer of the Frank W. Kerr Company, a now-defunct pharmaceutical wholesaler based in Novi, Michigan. Kerr had a revolving credit agreement with two large financial institutions under which the company borrowed funds up to $60 million pursuant to a calculation dependent on the company’s eligible accounts receivable and inventory.

Toloff admitted that he submitted false documentation to the financial institutions that included $18 million in ineligible accounts receivable and that Kerr borrowed additional funds after this false documentation was submitted. The Court found that Toloff’s criminal conduct caused Kerr’s lenders to sustain a loss of $1.3 million, which Toloff was also ordered to pay back to the lenders as restitution.

“Corporate executives should be held to the same standard of honesty as anyone else when they interact with lending institutions,” stated United States Attorney Dawn N. Ison. “When individuals lie to lenders, those lies cause loans to become more difficult and more expensive for honest consumers and businesses to access. My office is committed to ensuring that those who engage in dishonest financial crimes are held accountable.”

The case was prosecuted by Assistant U.S. Attorney Andrew J. Yahkind. The investigation was conducted by the Federal Bureau of Investigation.

Toloff was a Chief Financial Officer of the Frank W. Kerr Company, a pharmaceutical wholesaler based in Novi, Michigan. He was sentenced for providing a financial institution with false documentation in connection with a bank loan. The financial institutions involved in the loan had a revolving credit agreement with Kerr up to $60 million. Toloff admitted to submitting false documentation, including $18 million in ineligible accounts receivable.

Theodore Toloff was ordered to pay back $1.3 million in restitution to the lenders. He was sentenced to 1 year and 1 day in prison, followed by 2 years of supervised release. The case was prosecuted by Assistant U.S. Attorney Andrew J. Yahkind and investigated by the Federal Bureau of Investigation.

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