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The Entellium situation continues to play out as more news comes out regarding the former CRM Software giant. With the declaration of bankruptcy of former CRM Software giant, Entellium Software, it appears as if the Entellium situation is finally behind us. Intuit is also looking into a possible purchase of Entellium’s assets to help partially pay off much of the losses accrued by the venture capitalists who invested money into Entellium.

With the Intuit purchase comes an influx of money for Entellium software to help pay off its unfulfilled obligations. However, the priority of where this money is to be directed seems to be misguided. Rather than paying off wrongly pressured employees, the money is going to go to stupid investors who had full control over where they chose to invest their money.

More news is coming out regarding how former Entellium employees’ layoffs were handled. These situations were described as pressurized, unpleasant positions for employees who were surprised with the sudden dismantling of the company. With no prior notice, Entellium shut its doors, only giving employees time to pack their bags and sign severance papers. Former employees had little time to review these papers as they were pressured into signing these documents or threatened with the loss of their health insurance benefits. Many former employees succumbed to the pressure and signed the documents after barely glancing at them. This forced many to sign over rights such as severance pay and vacation payouts that they had rightfully earned.

The sale of Intuit will provide Entellium with money to partially pay off its debtors. However, the priority of who should be paid needs to be revised. Rather than paying off venture capitalists who were lazy and foolish, the money should be paid to employees. Employees had no control over what was going on and should get what they rightfully earned for the many years they served working for Entellium.

The future was looking bright for Entellium as revenues continued to show dramatic increases from year to year. Millions of dollars in investment money was already secured and business appeared to be booming. Entellium, a provider of CRM software for a number of small and medium-sized businesses, was on track to take on the bigger CRM Software giants such as Netsuite and Salesforce.com in the competitive CRM software market.

The company’s fortunes took an abrupt turn as the truth behind Entellium was uncovered. Everything came to a sudden end as the CEO and CFO of Entellium abruptly resigned as the secrets these two executives were keeping were revealed.

Paul Johnston appeared to be a respectable hard-working man. He had previously worked for Apple and had started Entellium in 2000 in Malaysia. He has two sons and a wife whom he had met in Asia. As the company grew, he was able to eventually move Entellium headquarters back to the United States. The company was doing well and the number of employees at Entellium continued to increase. He even took the opportunity to secure funding from a number of VCs to help fund his rapidly growing company.

However, things took a rapid turn for the worse as the truth behind Paul Johnston and Entellium was uncovered. Apparently, Paul Johnston tricked VCs into investing in Entellium with a number of false financial statements that overestimated revenue by millions. Although much of this money appears to have gone into the business, it was also noted that Paul Johnston used company funds and credit cards to fund family vacations all over the world. In addition, he provided himself with a number of six digit bonuses and personal loans that were all taken out of the company money. Now authorities are trying to track over 9 million dollars that was wired to the company office in Malaysia. However, the presence of an office in Malaysia is now being questioned as well.

Johnston’s fraudulent activities also were uncovered outside his business. Over the years, he had accumulated numerous material items due to the comfortable salary he paid himself. He had a million dollar home, drove a porsche and made over 1 million dollars in his time as Entellium CEO. Yet, with all this, he still reported fewer assets than a homeless person living on the street.

The many employees who relied on him were let down as they abruptly lost their jobs. Also, his family will lose a father and husband as well. as he is now facing 20 years behind bars as well as a substantial fine for wire fraud.

For more information on this previously unknown, but now infamous CRM Software CEO, you can find articles about him here and here.