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Inventory missing but sales continue at Alpha Omega

January 09, 2008

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Cambridge, Mass.—Troubled Alpha Omega Jewelers is now missing more than its founders.

According to a complaint filed in Suffolk Superior Court by the jewelry chain's chief creditor, $6.6 million of the Boston-area jeweler's inventory cannot be found, The Boston Globe reported.

While it is unclear whether or not the missing inventory is a result of bookkeeping errors or theft, officials from other jewelry stores who asked not to be named commented to the Globe that it is difficult to lose track of such a large volume of inventory in a well-run jewelry store.

Evidence of the missing merchandise first surfaced in mid December when LaSalle Business Credit, a retail lending arm of Bank of America Corp. and the store's chief creditor, filed the complaint, said the news source.

But, the litigation was placed on hold after about two weeks because the troubled jeweler filed for bankruptcy, the Globe reported.

In the meantime, a judge ruled on Jan. 4 that Alpha Omega could continue selling merchandise as the bankruptcy case moves forward.

An auction selling off the company's assets is scheduled to take place around Jan. 24.

The missing merchandise is just the latest in a series of bizarre events to unfold at the once-prosperous chain.

News of Alpha Omega first surfaced in December, when founder and owner Raman Handa and members of his family abruptly left the country amid financial troubles at the company and Handa's health issues.

Handa has been said to be receiving care in his native India and gave permission via e-mail for the company to file bankruptcy.

The Globe reported that it is not known when or if the Handas will return to the United States.

In the meantime, two consultants brought in earlier this year to help solve the company's financial woes—Consensus Advisors LLC's Michael O'Hara and Altman and Co. LLC's Gordon Lewis III—are running the day-to-day operations of the company.

Its seven Boston-area stores remain open for business.

Editor's note: For earlier developments in this story, see Alpha Omega files for Chapter 11.
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