Meet Terry Drayton, the Chief Executive at the embattled Count Me In.  This company recently made headlines when 200 youth sports programs that used  the company’s online services to collect registration fees and donations were not appropriately paid.  Apparently, Count Me In has a $5 million shortfall in client moneys.

Recently, John Cook interviewed him, and Terry had a lot to say, maybe too much.  Obviously affected by the slew of negative press over his company’s troubles, Terry wanted his side of the story to be heard.  He even said that the interview with John was “cathartic”.

Well, the interview may have been therapeutic for him, but it also may cost him plenty if criminal charges were to follow. Washington State Attorney General’s office has received more than 30 complaints.  A New Jersey soccer club has filed a lawsuit alleging that Count Me In has failed to pay more than $100,000 in registration fees.

Terry’s claim that he just didn’t know about the shortfall because the company didn’t keep detailed financial records is interesting.  Obviously, Terry wanted to show that there was no malice intent to take money from the youth programs.  He certainly wanted to make a clear distinction between his situation and that of Entellium, where the CEO and CFO knowingly cooked the company’s books to raise funds.

The question of whether a seasoned executive would really run a company for eight years, handling more than $175 million in funds, without proper financials is being widely speculated.  Regardless, one thing is clear, even in Terry’s own words:  He and the company had been negligent.  And negligence will not be an adequate defense in the court of law.  Although in a much larger scheme of things, Enron executives tried to use “not knowing” as a defense as well, but to no avail.  The point is that Terry should be careful at what cost he is publicly telling his side of the story.  Interestingly, he had his PR executive with him during the interview, not his lawyers.

Personally, I do think that Terry was sloppy (negligent), but not malice in intent.  I know he has a good reputation in the local business community.  And he really wants to be liked.  In fact, he started Count Me In after trying to help the local youth programs that his children were involved in.  But at this point, he should be cautious about what he says.  In looking at the comments in John Cook’s story, he’s not even winning any PR points by having told his side of the story.