Ex-Wings to Go CEO pleads guilty to embezzlement charges

The former CEO of Severna Park-based Wings to Go pleaded guilty Monday to wire fraud for embezzling more than $885,000 from the franchise company to pay for prostitutes and phone sex, the U.S. attorney's office in Baltimore announced.

Mark Chandler Goodnow, 55, of Pasadena, former president and CEO of the Buffalo wings franchise company, spent about $885,071 of the company's money to hire prostitutes in Maryland and to pay three women in Texas for phone sex and personal expenses, according to his plea agreement.

Goodnow hid more than 200 unauthorized expenses from 2006 through this year by reporting them in company records as advertising expenses, the U.S. attorney's office said.

He was indicted last month on embezzlement charges.

"A corporate executive cannot spend money for personal benefit and falsely report it as a business expense," U.S. Attorney Rod J. Rosenstein said in the announcement of the plea agreement.

Goodnow faces a maximum sentence of 20 years in prison and a fine of $250,000, Rosenstein's office said. Sentencing is set for Oct. 30 before U.S. District Judge Richard D. Bennett.

Phone and email messages to Wings to Go's corporate headquarters, now in Millersville, were not returned Monday. A woman who answered the phone said she was not authorized to disclose give the names of the firm's current executives.

The fast-food chain has locations in 13 states and Washington. The first location, which opened in 1985 near Dover Air Force Base in Delaware, specialized in wings with 20 sauce flavors, according to the company's website. As demand increased, the firm opened restaurants in Delaware's Dewey Beach and Wilmington and grew to five locations after three years.

Wings to Go began offering franchises in 1989, expanding to more than 80 outlets, a mix of carry-out shops and full restaurants, some of them with liquor licenses. The company's website says it is not accepting new franchise applications.

Goodnow began working for Wings to Go in November 1995, initially as director of operations. He became president and CEO in 2001, overseeing finances, sales, marketing, development and training. He was an authorized signer on the company's two bank accounts and maintained sole control over them, the plea agreement letter said.

In the summer of 2006, Goodnow met a woman from Texas on an adult Internet site and began a phone sex relationship, sending the woman money from Wings to Go's bank accounts, the letter said. He then developed phone-sex relationships with two other Texas women. Over six years, Goodnow spent more than $831,000 in company money to pay for phone sex and personal expenses for the women, according to the plea agreement letter.

Goodnow also spent more than $53,000 on unauthorized personal expenses in Maryland, including hiring prostitutes, the letter said.

It came as no surprise to one franchisee that funds reported as advertising expenses had gone elsewhere. Kewal Kapoor said that in the past few years he has seen his sales decline at the Columbia Wings to Go franchise he and his wife have run for 15 years.

Kapoor says he has struggled partly because of the recession and because of increased competition in the Buffalo wings category, but he mostly blames a lack of promised advertising from Wings to Go. Kapoor said the dearth of advertising had forced many Wings to Go franchisees to close their doors.

"About 40 stores have closed in the past six years, due to lack of advertisement," said Kapoor, adding that he could not afford much advertising on his own.

"These are the best wings in the whole world," Kapoor said, but without advertising to remind customers, "people have short memories."

The company's website now lists 58 restaurants nationwide.

The Goodnow investigation was part of a broader federal effort to aggressively investigate and prosecute financial crimes through President Barack Obama's Financial Fraud Enforcement Task Force, Rosenstein said. The group is made up of representatives of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement officials.


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