In Square’s attempt to go public on the stock market with the Securities and Exchange Commission (SEC), a mystery was uncovered. 5.7 million dollars was listed under the risk section in Square’s registration papers “related to fraud by a single seller.”
The question arose: who defrauded the San Francisco-based card-processing tech company out of millions?
The answer lives in Omaha, Nebraska. Patricia Urbanovsky owned the events planning company Creative Creations, and used it to sell fraudulent discounted travel vouchers falsely claimed to be connected to Southwest Airlines. Once customers began to ask for refunds, Urbanovsky and Creative Creations would not refund any money, thus leaving Square liable for millions. In June, Square filed a criminal report with the Omaha Police Department. In the report, Square claimed that they were out 2.8 million dollars in chargebacks, as well as payments currently being disputed and returned to customers. The number in the SEC filing is larger because it most likely represents the largest potential loss that Square may take.
Urbanovsky is charged with three counts of theft by deception. Her lawyer, Steven Lefler stated to Buzzfeed News that Creative Creations has not filed for bankruptcy yet, but also acknowledged that it is possibly in the future when stated, “We’ve been able to put it off for the last few months.”
All information gathered from Buzzfeed News
The official police report from the Omaha Police Department can be seen below. Click to enlarge.