AP NEWS

Former partners in firm say founder’s son misspent money

February 11, 2020 GMT

RALEIGH, N.C. (AP) — The son of the founder of a North Carolina accounting firm spent $500,000 of the company’s money on travel, limousines, alimony and at a strip club, according to a lawsuit filed by two of the firm’s former partners.

The lawsuit, which was filed Feb. 5 in Wake County, argues that Leon Little Rives II damaged the reputation of Rives and Associates, and says he used a credit card for $200,000 in personal expenses and withdrew $300,000 in cash from bank accounts, The News & Observer of Raleigh reported on Tuesday.

In an email, Rives said the lawsuit was filed by Jay Sharpe, former head of the Raleigh office, and Aaron Patel, once in charge of the Charlotte office “in an attempt to get out of partnership obligations to the Firm.”

Rives said terms of a settlement have been reached and documents will be signed soon. He said though Sharpe and Patel have sued the firm, they will end up owing the firm “a significant amount of money.”

Rives frequently called clients while intoxicated and triggered an investigation by the state Board of CPA Examiners, and he caused an employee to complain of both sexual harassment and a derogatory comment about religion, the lawsuit says.

Rives father, William Leon Rives, was repeatedly told about his son’s behavior but failed to act, the lawsuit says. Sharpe and Patel cite 13 claims including breach of contract, fraud and conspiracy. Also, Patel and Sharpe argue that multiple employees and partners have left R&A because of the Rives family, and that their professional lives have suffered through their employment there.

The plaintiffs are seeking damages in excess of $25,000.