‘Ragtime’ producers deny accounting fraud

Former Broadway producers Garth Drabinsky and Myron Gottlieb have been charged with two counts of fraud and one count of forgery. Their trial began Monday in Ontario Superior Court in Toronto.

Prosecutors allege the two Canadians who co-founded Livent, a major Broadway theatre company which produced hit shows such as ‘Ragtime’ and ‘Showboat’, raised hundreds of millions in financing and that the fraud began even before Livent went public, interactive investor reports.

The Toronto-based company filed for bankruptcy protection after the alleged fraud was revealed when Michael Ovitz, former Walt Disney Co president, invested in Livent. Drabinsky, Gottlieb and their lawyers declined comment.

Prosecutor Robert Hubbard said he is calling seven former Livent employees who will testify their former bosses falsified financial statements and had their accounting software modified to inflate income. Hubbard said they hid production costs and inflated ticket sales to attract investors.

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