A new legal battle between a former chief financial officer and his employer has turned a once fast-growing whiskey brand’s finance function into a case study in how financial oversight failures surface under pressure.
At whiskey maker Uncle Nearest, allegations of CFO misconduct against former finance chief Michael Senzaki now sit alongside a nine-figure lender dispute, missing financial records and a court-appointed receivership that stripped founders and the board of control. What began as a financing relationship unraveled into litigation, asset scrutiny and court supervision.
The filings, receiver reports and court rulings now offer a timely window into how breakdowns in financial controls, data governance and executive oversight can escalate quickly, drawing in lenders, judges and third-party managers before leadership has time to react wholeheartedly. For CFOs and boards, the unfolding situation shows how disputes over financial accuracy and authority do not stay contained. Once confidence in the numbers erodes, control over the business can follow.
A CFO lawsuit opens a broader financial reckoning
In late December 2025, co-founders Fawn and Keith Weaver filed a civil lawsuit in Tennessee’s Bedford County Chancery Court against Senzaki. The complaint alleges misconduct tied to financial reporting and the handling of company funds and founder equity, accusing him of exercising exclusive control over Uncle Nearest’s financial systems and misrepresenting the company’s financial condition during a key period of growth.
According to the filing, the founders allege that expenses were suppressed, liabilities concealed and invoices altered to make vendor obligations appear settled. The lawsuit also claims that company funds were redirected without authorization and that founder equity interests were pledged without consent, exposing the Weavers to liabilities they say they neither approved nor incurred.
The CFO lawsuit followed a separate legal action filed earlier in 2025 by Farm Credit Mid-America, Uncle Nearest’s primary lender, which sued the company in July seeking repayment of more than $100 million. The lender alleged loan defaults and breaches of lending terms, including issues tied to collateral based on whiskey barrel inventory.
That lawsuit led the court to appoint a receiver in August, transferring day-to-day operational control of Uncle Nearest to an independent third party. The receiver was tasked with stabilizing the business, protecting creditor interests and avoiding a bankruptcy filing.
In his first quarterly report, the receiver outlined early steps taken during the initial weeks of oversight. Those actions included asserting jurisdiction over domestic and international assets, engaging with distributors and shareholders and putting a 13-week operating budget in place to manage near-term cash needs.
The budget identified a $2.5 million shortfall tied to delinquent operating expenses and professional fees associated with the receivership. To address the gap, the receiver reached a forbearance agreement under which the lender agreed to fund the deficiency in exchange for adherence to court-supervised operating, cash management and reporting requirements.
Operational changes followed. The receiver reduced headcount, narrowed the company’s scope of operations and concluded that certain assets and business lines were not supportable under existing financial conditions. Plans were initiated to liquidate nonessential properties, including assets located outside the United States.
The quarterly report expressed optimism about the company’s ability to emerge from receivership by early 2026. At the same time, it disclosed material weaknesses in Uncle Nearest’s accounting records, including uncertainty around the accuracy of financial statements, unexplained accounting entries and revenue recognition practices that may have inflated reported performance.
Missing records, receiver authority and a frozen board
As the receivership progressed, questions about historical financial data emerged. The receiver reported difficulty reconstructing the company’s earlier financial position due to missing records. A substantial portion of pre-2024 financial information was no longer accessible, and efforts to recover those records were ongoing.
The receiver stated that he had not identified improper financial practices by current management. He also indicated that earlier allegations by the company’s CEO, asserting that the former CFO acted alone in overstating barrel inventory provided to the lender, appeared credible, according to reporting by Thunder Radio.
During this period, the court authorized the receiver to investigate whether additional entities connected to the founders should fall within the scope of the receivership. The investigation included operating businesses, real estate entities and a family foundation, expanding the potential reach of court oversight beyond the distillery itself.
The founders sought relief from the receivership in November, citing declining sales and progress outlined in the receiver’s quarterly report and arguing that continued court control was harming the company’s prospects. The court denied the request in December, concluding that lifting the receivership would disrupt ongoing stabilization efforts and complicate resolution of creditor claims.
In its ruling, the court emphasized that once a receiver is appointed, authority over company operations and communications rests with that receiver. In a separate order, the judge struck a filing submitted by the founders on behalf of the board, stating that the receiver alone is authorized to speak for the company under the terms of the receivership.
Days later, the founders escalated their legal strategy by filing the lawsuit against Senzaki, alleging that responsibility for the company’s financial distress had been shifted onto them as issues surfaced, resulting in reputational and financial harm.
Failure of financial controls
The Uncle Nearest situation highlights how weaknesses in financial controls can escalate into a governance crisis.
At the center of the dispute are allegations of concentrated authority within the finance function. Claims that a single executive, in this case Senzaki, allegedly maintained exclusive control over financial reporting systems and lender communications point to limited segregation of duties and reduced internal visibility.
A loss of historical financial records compounded those challenges. Missing data, which the receiver said was erased by a former employee shortly after termination, constrained his ability to reconstruct past performance and increased uncertainty around the company’s financial position.
The case also illustrates how quickly financial control issues could affect governance. Once a lender filed suit and the court appointed a receiver, decision-making authority shifted away from management and the board. Strategic direction, communications and asset management became subject to court oversight.
For CFOs and boards, the episode underscores the importance of documented controls, shared system access and regular oversight. When a finance authority becomes isolated and visibility erodes, the consequences extend beyond financial statements and into control of the organization itself.
