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Wednesday

Utah judge tosses evidence in Koerber alleged ‘Ponzi’ case-Federal court » Prosecutors failed to follow rules, violated constitutional rights, ruling says.


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(Francisco Kjolseth | Tribune file photo) An indictment alleges that Rick Koerber used about half of the $100 million taken in from investors to pay back other investors and make it appear the operation was profitable when it was not. He denies the charges.
Utah judge tosses evidence in Koerber alleged ‘Ponzi’ case
Federal court » Prosecutors failed to follow rules, violated constitutional rights, ruling says.
First Published Aug 20 2013 05:17 pm • Updated 4 hours ago
A federal judge has prohibited prosecutors from using as evidence interviews former Utah County businessman Rick Koerber gave to investigators before his indictment for allegedly operating his real estate investment company as a $100-million Ponzi scheme.
U.S. District Judge Clark Waddoups ruled that prosecutors and investigators violated professional conduct rules, federal law and Koerber’s constitutional rights when they failed to contact attorneys who had represented Koerber prior to two interviews in 2009 with FBI and IRS agents.
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Waddoups chided prosecutors for not attempting to contact the lawyers, who had represented Koerber, the chief owner of FranklinSquires Cos., after Koerber had contacted an agent and expressed a willingness to talk.
Even though defense attorney Max Wheeler had told prosecutors at some point that he was no longer retained by Koerber, Wheeler also had suggested they call other attorneys who had represented Koerber or his companies in the past, Waddoups wrote.
But prosecutors did not do that because they likely would have been told there would be no interviews, the judge wrote in the ruling, adding "the way it was approached at least allows an inference that they didn’t want to get that response, they wanted to be coy and say, can we justify saying that he’s not represented so we can interview him."
Koerber’s attorney, Marcus Mumford, characterized the decision as tossing out a key piece of evidence against his client.
"This is a significant blow to the government’s case," Mumford said.
A spokeswoman for the U.S. Attorney’s Office for Utah said she could not yet say whether the government would appeal.
"Because there are issues pending in this case, we feel it would be inappropriate to comment on Judge Waddoups’ ruling at this time," Melodie Rydalch said in an email.
The government has not revealed the extent of its evidence but it has dozens of boxes of records from the company and agents have been investigating since 2006.

The ruling is the second time Waddoups has thrown out a piece of government evidence. He ruled in 2011 that a draft of a letter to key investors in FranklinSquires could not be used against Koerber because it was part of consultation with his attorneys and there was no evidence it had been actually mailed.
Last year, the judge also dismissed two charges against Koerber, ruling the indictment was too vague in spelling out the allegations.
Koerber still faces 18 charges of fraud, money laundering and tax evasion.
Koerber was originally indicted in May 2009, with 19 additional charges added in a second indictment that November. A third indictment was sought by prosecutors after Waddoups ruled the letter could not be used as evidence.
Koerber denies he operated his FranklinSquires Cos. and related entities as a Ponzi scheme, although the indictment alleges he used about half of the $100 million in funds the companies received from investors to pay earlier investors and make the operation appear profitable until it collapsed in the real estate bust of 2008.
Koerber promoted his "Equity Milling" form of real estate investments on billboards and magazines, and through seminars that people paid several thousands of dollars to attend. He later took out billboards and went on his radio show to tweak state regulators who began probing his operations before its collapse.

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Koerber Defends Actions
(KUTV) He called himself the free capitalist, but the federal government said he should go to prison.

Now the fraud case against Rick Koerber has suffered a major setback, all because of the actions of prosecutors and investigators.

Koerber spoke out boldly after he was indicted by federal prosecutors for fraud and other charges, and said he was innocent.

Now Judge Clark Waddoups has ruled the indictment may have been partly due to unethical conduct by federal prosecutors.

Rod Decker explains why this case may be thrown out.

(Copyright 2013 Sinclair Broadcasting Group)

Thursday

Here We Go Again! Rick Koerber's Confidentiality is Violated-- By A Sitting US ATTORNEY, Stewart Young

THE AUDIO IS NOW LIVE..AGAIN
URGENT UPDATE:
BECAUSE OF THIS STORY AND THE AUDIO ASSOCIATED WITH THE COMMENTS OF ATTORNEY STEWART M. YOUNG AT BYU IN UTAH, HE HAS BEEN FORMALLY REMOVED FROM THE RICK KOERBER CASE IN UTAH USA
THERE IS GOING TO BE A BIG LAWSUIT HERE AND JUST THINK, YOUR LOCAL MEDIA IS DOING ALL IT CAN TO SUPPRESS THIS INFORMATION ALONG WITH BRIGHAM YOUNG UNIVERSITY..... JUST FOLLOW THE FACTS, THE COMMENTS AND THE MONEY. WONDER WHAT RICK KOERBER HAS TO SAY ABOUT THIS. WE WILL POST MORE INFORMATION AS IT BECOMES AVAILABLE.


DISCLAIMER- ALL DATA THAT IS RELEASED IS FOR MEDIA RELATED PURPOSES AND IS BEING DONE SO WITH THAT INTENT.
Notice:
We have just received a digital audio document from a source that shows just how desperate the United States Government is to convict Rick Koerber and Franklin Squires.  We will present to you a full media release of the full backstory and the the complete conversation by and between third parties to the Koerber Case by one of the CURRENT PROSECUTORS, Stewart Young of Utah.

Stand by my friends, because this tape is going to blow you away.  We thank our sources in advance for having the foresight to record this documentation of prosecutorial abuse.  Its amazing that they could not trust ABC, NBC or CBS.... There is a reason for that.

This will be posted on CNN IReport.


Robert Paisola
CEO
Western Capital Multimedia USA
www.RobertPaisola.com 
THE AUDIO, STORY AND CONTENTS ARE THE PROPERTY OF WESTERN CAPITAL MULTIMEDIA AND PORTIONS OF THE AUDIO ARE THE PROPERTY OF BRIGHAM YOUNG UNIVERSITY  legal@robertpaisola.com

THE AUDIO FROM AUSA STEWART YOUNG (DOWNLOAD THIS NOW)

http://tinyurl.com/StewartYoungAtBYUServer13


IF YOU ARE INTERESTED IN EDUCATIONAL FAIR USE JUSTICE, DOWNLOAD THIS NOW AND EMAIL US THE LINK AROUND THE WORLD.

COMMENT:  5-23-13 Miami
This file has now been collocated on 16 servers around the world. We are posting this as an EDUCATIONAL EXCEPTION TO THE COPYRIGHT. IF ANY ATTEMPT IS MADE TO PULL THIS DOWN AGAIN, WE WILL PROVIDE YOU WITH THE ENTIRE BACKSTORY OF WHERE IT CAME FROM.

COMMENT:  5-21-13 Los Angeles
This is how bad that they do not want you to hear this tape:  We will never quit!
Hello robertpaisola,
Kiwi6 has been notified in accordance with the Digital Millennium Copyright Act (DMCA) that some of your materials allegedly infringe upon the copyrights of others (sender email: urquiagal@law.byu.edu). The URLs of the allegedly infringing materials may be found at the end of this message. The DMCA is a United States copyright law that provides guidelines for online service provider liability in case of copyright infringement.
We are in the process of removing from our servers the files that allegedly infringe upon copyrights. If we did not do so, we would be subject to a claim of copyright infringement, regardless of its merits. If you feel that your files were mistakenly removed due to a DMCA request filed against you, Kiwi6 can reinstate these materials upon receipt of a DMCA Counter Notification form to support@kiwi6.com. If you have legal questions about this notification, you should speak with your own legal counsel. The affected URLs are listed below:
Comments of AUSA Stewart Young UTAH to BYU - http://kiwi6.com/file/32xunbjwk8
The Kiwi6 Team

THE ISSUE
On April 18, 2013 Federal Judge Clark Waddoups chastised the government in open court for its repeated misconduct in bringing the case against Utah businessman Rick Koerber.  During that hearing the Judge stated:

"You're still saying you didn't say mother may I.  I want you to go behind that and tell me why that makes one bit of sense under our system and our constitution."  

Further, the Judge repeated, "the government's position doesn't make any sense."  

In retaliation, Assistant United States Attorney Stewart Young recently told a BYU law class that the government's un-constitutional misconduct was acceptable because Koerber, "is a scumbag" and "Judges in our district...are not very hard on white-collar criminals [like Koerber] because they believe that th[ey] are just poor misunderstood Mormon bishops who, just happened to take $100 million."  

Further, AUSA Young lectured the law school students that "Rick Koerber "ran a ponzi-scheme" without disclosing that the case is still pending, the government has been found repeatedly guilty of illicit and unlawful conduct, and that prosecutors have admitted to the judge that they have changed their argument and now don't intend argue that Koerber actually had "any" victims, but instead that if his business continued he might have had victims and thus he should be found guilty.  Young also revealed apparently unsubstantiated government theories regarding Koerber's use of trust funds and financial advisers - none of which have ever been mentioned in the charges Koerber now faces.

Evidently, prosecutors are sore over Judge Waddoups throwing out illicit evidence obtained and used by government prosecutors to secure the original indictment and the fact that he has since begun dismissing additional charges in the now pending 3rd indictment.   Young is also critical in his remarks of the FBI and praises the IRS - apparently a reference to FBI Agent Cameron Saxey and IRS Agent Ron Marker's performance in the Koerber case.  Evidently, the FBI has been less than willing to prosecute Koerber for political reasons.  IRS Agent Marker is the only witness the government could find to testify before the Federal Grand Jury that returned the last indictment of Koerber.  

Finally, during his presentation to the law students, AUSA Young also admits that the federal government has been "bootstrapping" allegations to bring Koerber to trial rather than relying on actual facts and allegations of direct wrong-doing.  

Legal experts consulted by Western Capital suggest that all of Young's comments may also be prosecutor misconduct in direct violation of the Utah Rules of Professional Conduct Rule 3.6(a) and 3.8 which reads:  

"A lawyer who is participating or has participated in the investigation or litigation of a matter shall not make [] extrajudicial statement..."

It remains to be seen how Judge Waddoups will react to AUSA Young's vocal contempt and misconduct before law students at Brigham Young University.  Especially in light of the government's pattern of criticism of his decisions.  For example, former US Attorney Tolman's statement to the press that Waddopus has been "inappropriately light" in sentencing certain defendants, such as Susan Russ.  The United States's Attorneys Office has also been critical of Judge Waddoups regarding the Sister Wive's lawsuit, the State / Federal land disputes, and his "astounding" criticism of the federal government and the FBI in an OKC bombing case.  

See recording at:  48:17; 48:42; 57:34; 1:12:36; 1:13:08;  

THE AUDIO FILE LINK
http://tinyurl.com/StewartYoungAtBYUServer13

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Wednesday

Rick Koerber of Franklin Squires asks US Federal Judge Clark Waddups (Utah) to toss interview with agents

Rick Koerber of Franklin Squires 
asks US Federal Judge Clark Waddups (Utah) to toss interview with agents


Charges » Accused of massive fraud, Utah businessman claims investigators violated his rights.
First Published 1 minute ago • Updated 1 minute ago
Rick Koerber, the Utah County businessman facing charges that he ran his real estate investment company as a Ponzi scheme, tried to convince a federal judge Wednesday that he was improperly interviewed by federal agents before he was indicted by a grand jury.
At issue is whether Koerber was represented by an attorney at the time of the February 2009 interviews and, if so, whether the FBI and IRS agents should have conducted them without Koerber’s counsel being present.
     
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Koerber’s current attorney, Marcus Mumford, has told U.S. District Judge Clark Waddoups that the interviews violated Koerber’s rights and federal rules, and he wants any evidence obtained from them to be barred from use by prosecutors who are pursuing 18 counts of fraud, money laundering and tax charges against Koerber.
In testimony Wednesday, Koerber said he was represented at the time by Salt Lake City criminal defense attorney Max Wheeler. That contradicted earlier testimony in which a former state attorney who was working with federal investigators said Wheeler told her that he no longer represented Koerber after he had failed to pay his legal bills.
Koerber said Wheeler did represent him, although he testified he had been unable to contact the attorney from before the first interview on Feb. 13, 2009, until April of that year, when he was told he would be indicted and Wheeler ended their relationship.
"I had not been able to speak directly to Max," Koerber said, although he added that he had talked to two other attorneys in Wheeler’s office and believed they also represented him.
Waddoups continued the hearing until late November to give Mumford time to call Wheeler as a witness.
Previously, FBI Special Agent Cameron Saxey had testified that Koerber had first proposed that he meet with investigators but that members of the U.S. Attorney’s Office had first recommended against a meeting but later agreed after they were told Koerber was not represented by an attorney.
Koerber also testified that he was fearful during the meetings that he would be arrested and that when a question arose about whether he was represented by Wheeler, he declined to abort one of the interviews and leave the FBI offices in Salt Lake City.
"I said, ‘You guys have the badges, I’ll do what you say,’ " Koerber testified.


Koerber was originally indicted on three counts in May 2009, with 19 additional charges added in a second indictment that November. A third indictment was sought by prosecutors after Waddoups tossed out a key piece of evidence from the first two.
The indictments allege Koerber’s real estate investment companies were operated as a Ponzi scheme in which about half of the $100 million they took in were used to make them appear profitable when they were not.
Koerber denies the charges. No trial date has been set.

OUR COMMENTARY- AMERICA- WE HAVE SEEN THE THOUSANDS OF PAGES OF EVIDENCE. THIS CASE IS FUNDAMENTALLY FLAWED.  THERE COMES A TIME WHEN YOU HAVE TO LOOK AT THE EVIDENCE AND SIMPLY SAY.. THINGS DO NOT ADD UP.  MANY OF YOU KNOW THAT WE WERE ONE OF THE MOST VOCAL CRITICS OF RICK KOERBER AND FRANKLIN SQUIRES, BUT THE ONLY WAY THIS ALL WOULD ADD UP TO A CONVICTION IS IF WE WERE LIVING IN A COMMUNIST COUNTRY.  THERE HAVE BEEN SO MANY MISTAKES THAT IF THIS GOES TO TRIAL, IT WILL BE WORLD NEWS DAILY.  @RobertPaisola @UtahNewsZone @WorldNewsZone

Friday

Feds file new indictment in Koerber investment fraud case , Colaboration by Robert Paisola WC Media USA

Before you read this, please read our statement:
http://franklinsquires.blogspot.com/2011/08/our-public-statement-on-c-rick-koerber.html

The Indictment from The US Attorney Website: Not too much different... Look at the Date... 2009? Is this just a rehash of the old stuff.. Looking at the Justice Department Memo (below) ...YEP
http://www.justice.gov/usao/ut/caseupd/documents/koerber%20superseding%20indictment.pdf


"There are no substantive changes in the superseding indictment. Changes were made to the section of the indictment describing the scheme and artifice to defraud. In addition, Count 1 of the previous indictment was eliminated following a ruling by U.S. District Judge Clark Waddoups that documents which formed the basis of Count 1 were protected by the attorney-client privilege."


The Official United States Justice Department Statement
http://www.justice.gov/usao/ut/press/releases/Koerber%20second%20ss%20indictment%20statement.pdf



The Salt Lake Tribune
Published: September 29, 2011 08:48PM
Updated: September 29, 2011 11:53PM

Francisco Kjolseth | Tribune file photo Rick Koerber, accused of massive fraud in Utah County shows up to Federal Court in Salt Lake City in January 2010 for a status hearing alongside his wife, Jewel Skousen. The federal government on Thursday filed a new indictment against Koerber after a judge threw out a key piece of evidence in case over an alleged investment scam that took in more than $100 million.

A federal grand jury on Thursday returned a new 20-count indictment alleging Utah County businessman Rick Koerber engaged in widespread investment and tax fraud.

The indictment follows a federal judge’s decision in July to throw out a key piece of evidence in Koerber’s case, in which he is accused of running an investment scam that took in more than $100 million.

Assistant U.S. Attorney Stewart Walz previously said the ruling by U.S. District Judge Clark Waddoups affected a “significant” part of an existing 22-count indictment alleging fraud, money laundering and tax evasion by Koerber in his operation of FranklinSquires Cos. and related real-estate investment businesses.

Waddoups’ decision forced prosecutors to seek a new indictment, which was filed Thursday, said Melodie Rydalch, public information officer for the U.S. Attorney’s Office.

“There are no substantive changes in the superseding indictment,” Rydalch wrote in a statement. She said small changes were made to a section of the indictment describing the alleged “scheme and artifice to defraud.”

Count one of the first indictment was deleted after Waddoups’ ruling, which found documents that formed the basis of count one were protected by attorney-client privilege, Rydalch said.

The indictment accuses Koerber of operating a Ponzi scheme in which money from new investors was used to pay initial and previous investors to make the businesses appear profitable and to continue to attract new money.

Waddoups’ previous ruling stated a draft letter Koerber had prepared for major investors was subject to attorney-client privilege and couldn’t be used against him. The government contended the letter had been sent to investors in the real-estate company, but Waddoups said testimony from Koerber and other sources indicated the letter was never sent out and remained confidential communication between Koerber and attorneys.

Waddoups said in his ruling that a government witness, Koerber’s former personal assistant, was not credible when she testified she mailed out the letter on Koerber’s instructions.

The letter has not been placed in the court record nor read in open court, but testimony and court filings indicate it had to do with how investors’ funds would be used.

Koerber was originally indicted on three counts in May 2009, but 19 additional charges were added in a previous superseding indictment in November of that year.

Koerber was considered something of an investment guru in Utah County, where he charged large fees for seminars and classes about investing in real estate using procedures he called “equity milling.” But prosecutors also said he lured in hundreds of investors with promises of high returns before the companies collapsed when the nation’s real-estate bubble burst in 2008.

The indictments allege he used about half of the $100 million to pay back initial investors and also spent funds on investments other than real estate.

Koerber’s attorney, Marcus Mumford, contends the government has no evidence that Koerber promised investors one thing and did something else.

mrogers@sltrib.com

Twitter: @mrogers_trib



Koerber partner faces tax charge

Gabriel S. Joseph, a partner with Rick Koerber in the FranklinSquires Cos., also faces federal charges. Joseph was charged in April with two misdemeanors for allegedly failing to file tax returns for 2004 and 2005. He has pleaded not guilty, and a trial is set for December.


This is another Article on this Matter:
Utah County businessman indicted in federal court, again
Story
Discussion


Jim Dalrymple - Daily Herald | Posted: Friday, September 30, 2011 12:01 am | No Comments Posted
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SALT LAKE CITY -- A federal grand jury has returned a second superseding indictment against a Utah County businessman accused of tax fraud.

The indictment charges Rick Koerber with six counts of fraud in the offer and sale of securities, 10 counts of wire fraud, two counts of money laundering and two counts of tax evasion. A federal court news release states that one count from a previous indictment was eliminated because a document on which that count was based could not be used in court.

Court documents state that Koerber used several different businesses and Ponzi schemes to bilk investors out of their money. The case was filed in 2009, and Koerber initially was charged with three counts -- mail fraud, wire fraud and tax evasion. Additional criminal charges were filed later for his alleged involvement in a $100 million Ponzi scheme.

According to Koerber's charging documents, Koerber carried out his scheme between 2004 and 2008. The documents state that he used a real estate program he dubbed an "Equity Mill" to convince investors that they could make significant amounts of money. He attracted new investors with magazine advertisements that promised investors they could make money without ever buying property, the documents reveal. He also reportedly claimed that the so-called investments were risk-free.

But the money he took in through his Founders Capital company reportedly was not used for the Equity Mill -- as he claimed it would be -- and other companies Koerber ran were not profitable. Koerber was aware of those facts, the documents assert, but intentionally misled investors.

Koerber also is accused of using investor money improperly. The documents state that he spent more than $800,000 on restaurants, $1 million on expensive cars, $5 million making a movie, $425,000 minting coins and hundreds of thousands of dollars on other expenses. The documents ultimately assert that Koerber took in more than $100 million in investor funds, and used more than $50 million to make Ponzi payments.

Koerber's new indictment comes after a judge prohibited prosecutors from using a letter Koerber wrote in the past. Koerber argued that the letter was protected by attorney-client privilege, while prosecutors believed he had used it to mislead investors.

Koerber's attorney, Marcus Mumford, has said that he believes the allegations are baseless. He pointed out that a key witness for the prosecution turned out not to be credible. Mumford also said the entire case has been built on unsupported facts and conclusions.
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Copyright 2011 Daily Herald. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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Posted in Crime-and-courts, Alpine, Jim-dalrymple on Friday, September 30, 2011 12:01 am Updated: 12:15 am. | Tags: Alpine, Crime, Fraud, Federal Court, Tax Evasion, Rick Koerber




SALT LAKE CITY -- Federal prosecutors plan to file a new, or superseding, indictment against an Alpine businessman after a judge ruled that a letter the man wrote cannot be used in court.

Melodie Rydalch, spokeswoman for the U.S. Attorney's Office in Utah, said that the federal government's first count against Rick Koerber is based on a specific document that U.S. District Judge Clark Waddoups ruled Tuesday is privileged. As a result, prosecutors cannot use that document and will seek the superseding indictment. Rydalch did not say what new charges Koerber may face.

Koerber had faced 22 charges related to tax evasion and fraud. Court documents state that Koerber used several different businesses and Ponzi schemes to bilk investors out of their money. The case began in 2009 and Koerber initially was charged with three counts -- mail fraud, wire fraud and tax evasion. Nineteen additional criminal charges were filed later for his alleged involvement in a $100 million Ponzi scheme.

Rydalch stressed Tuesday afternoon that seeking a superseding indictment is a routine procedure and does not mean prosecutors were dismissing the case. She added that prosecutors remain confident in the case.

But defense attorney Marcus Mumford described Tuesday's developments as a victory for Koerber. He said that the government's decision to seek a superseding indictment stemmed from a ruling Waddoups issued in June and which prohibited prosecutors from using a letter Koerber had written. Koerber argued that the letter was protected by attorney-client privilege, while prosecutors believed he had used it to mislead investors.

After a key witness for the prosecution was found to be not credible, Waddoups sided with the defense. Mumford added government investigators never found anyone who received the letter during a three-year investigation.

Mumford also said that the entire case has been built on unsupported facts and conclusions, and added that he anticipates the superseding indictment to be the same.

"We'll be interested in how the government changes its theory here," he said. "We expect that it will be faulty."

Koerber's next hearing is scheduled for Oct. 7.
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Copyright 2011 Daily Herald. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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Posted in Crime-and-courts, Alpine, Jim-dalrymple on Wednesday, August 3, 2011 12:14 am Updated: 2:35 pm. | Tags: Alpine, Crime, Ponzi Scheme, Fraud, Tax Evasion, Rick Koerber, Federal Court, Melodie Rydalch

Tuesday

Our Public Statement on The C Rick Koerber Federal Court Decision, Robert Paisola Reports















To our friends in the media and around the world:

Please understand that the federal court ruling for Claud R Koerber is clearly noted. As many of you know, we have been working on this matter for over three years. You may also note that we have stated in open forums and dialogue that after we spent OVER SIX MONTHS reviewing the data and the documents on the case, and spent time with Koerber, we were also forced to immediately reverse our previous statements, as the fundamental data simply was not there. We thank you for your comments and you need to clearly understand that Western Capital is now based in Las Vegas Nevada. This is where we are spending our time. We can not, nor we issue statements on the Rick Koerber Case, other than to say, "Koerber is one of the most advanced legal minds in the country, and the evidence starts and stops at the Federal Trial Court Level. America, Simply look at his RESULTS."
To your success,
The Western Capital Team
Las Vegas Nevada USA

From The Salt Lake Tribune

Watch the interview with Rick Koerber and KUTV's Brian Mullahy



Watch the interview with Robert Paisola and Rick Koerber (Copyright 2011)




Koerber's Statement and Comments
"For the record - the link below - has been re-written by the Salt Lake Tribune after they were contacted by the government - who evidently didn't like the story very much. So, what you see now is the "clean" gov't propaganda version. The Salt Lake Tribune should be ashamed. As I've said before, they are essentially the PR arm of the government. I'll post the "whole" story on my blog at rickkoerber.com"
 
A prosecutor said Monday the federal government has been forced to seek a new indictment against Utah County businessman Rick Koerber after a judge threw out a key piece of evidence in a case involving an alleged investment scam that took in more than $100 million.

Assistant U.S. Attorney Stewart Walz told a federal magistrate that the ruling last month by U.S. District Judge Clark Waddoups affected a "significant" part of an existing 22-count indictment alleging fraud, money laundering and tax evasion by Koerber in his operation of FranklinSquires Cos. and related real-estate investment businesses.

A new federal grand jury indictment should take 30 days to 60 days to hand up, Walz told U.S. Magistrate Sam Alba at a hearing that had been convened to set deadlines and a trial date for Koerber. The existing indictment says Koerber ran what allegedly was largely a Ponzi scheme in which money from new investors was used to pay initial and previous investors to make the businesses appear profitable and to continue to attract new money.

Koerber’s attorney, Marcus Mumford, said the decision means the charges against Koerber will be dismissed as a procedural matter if prosecutors convince a grand jury to hand up a new indictment.
"They have to come up with a new theory in the case," said Mumford. "They have to go to the grand jury and present new and different evidence to support this theory."

Waddoups ruled last month that a draft letter Koerber had prepared for major investors was subjected to attorney-client privilege and couldn’t be used against him. The government contended the letter had been sent to investors in the real estate company, but Waddoups said testimony from Koerber and other sources indicated the letter was never sent out and remained confidential communication between Koerber and attorneys.

The decision to seek a new indictment does not mean prosecutors have a weak case, said Melodie Rydalch, spokeswoman for the U.S. Attorney’s Office for Utah.

"We have represented to the court that we may refine some counts in the current indictment and add additional counts in a superseding indictment," she said. "What we intend to do is necessitated by the court’s privilege ruling, not by any concern over the merits of the case."he charged large fees for seminars and classes about investing in real estate using procedures he called "equity milling." But prosecutors also said he lured in hundreds of investors with promises of high returns before the companies collapsed when the nation’s real estate bubble burst in 2008.

The indictments allege he used about half of the $100 million to pay back initial investors and also spent funds on investments other than real estate.

Mumford contends the government has no evidence that Koerber promised investors one thing and did something else.

Thursday

Claud 'Rick' Koerber carries on despite Ponzi scheme charges, Robert Paisola Reports


HIGHLAND — It's clear, just from the words he uses, that the line has been drawn in the sand.

This is a battle. A fight. This is the government versus the businessman. And while Claud "Rick" Koerber, 36, thinks it's quite a compelling story, he said it would be more interesting if this conflict weren't also his life.

Though he has been accused by the government of running a Ponzi scheme that bilked investors of $100 million, Koerber is undeterred. He's not repentant because he says he's not guilty. He believes in the money he made and the company he built. He intends to fight the battle and emerge victorious.

"The rules of the justice system are that you can fight," he said. "It's the fundamental thing that makes a free society more attractive. Just because the government accuses you, it doesn't mean it's true. I'm proud of my business. I'm proud of what we did. I think that what we did was amazing."

Koerber made a name for himself as the "Free Capitalist," a radio personality who leans Libertarian politically, is objectivist in his philosophy and capitalist when it comes to economy. Wednesday, he relaunched his Free Capitalist Project, which involves the continuation of his radio show, features an updated Free Capitalist Web site and another site of Koerber's personal blog.

More than anything, he said he is someone who believes in responsible, accountable citizens who turn to themselves — not their government — for solutions. Even in the face of their failures. And that is what the Free Capitalist is about.

Koerber said people were once allowed to go out on a limb, say, make a business investment and fail. But they now look for a place to point the blame, and quite a few fingers are pointing his way.

Koerber was hit with a three-count indictment in May 2009 charging him with mail fraud, wire fraud and tax evasion. In November, a grand jury handed down a new indictment that includes a total of 22 counts and additional charges of fraud in the offer and sale of securities, sale of unregistered securities, money laundering, and additional counts of both wire fraud and tax evasion.

If convicted of every count, he faces a maximum of 285 years in prison — more than someone might receive even for killing someone, Koerber pointed out.

The business ventures, he said, were always a side project. Prosecutors believe he solicited investors and then encouraged them to "act and think like a bank." The groups of investors were supposed to recruit other investors, all under Koerber's assurance that their investments were "backed, collateralized or secured by real property," the indictment against him states.

Koerber was involved with several businesses in Utah, including Founders Capital, Franklin Squires Investments and Franklin Squires Companies. Prosecutors say Koerber operated a Ponzi scheme to make it appear as though these companies were turning a profit to secure more investors, yet "at no time during the operation of the scheme did the Founders Capital or Franklin Squires … turn a profit."

Koerber said the term "Ponzi scheme" was used by a government looking to depict the issue with a "big, broad brush." He insists it wasn't a Ponzi scheme at all. He says his business took the same hits most other businesses did in the current economic downturn, yet his business was also affected by what he believes were lies spread by the government.

A moviemaking venture that, according to the indictment, cost about $5 million wasn't a failed project, Koerber said, merely one that hasn't seen completion. He said they're still hoping the movie will be bought and marketed.

He believes the company would have gained back what it lost, if not for the disruption and controversy caused by the indictment.

"We never would have stopped," he said. "We would have survived but for the government's reaction. You can't survive both the economic collapse and the government saying you're a fraud, a schemer."

Koerber said he never would have taken a hiatus from his Free Capitalist project, either, but he spent 2009 dealing with "this new problem" and sorting through his priorities. He chose his own attorney and underwent a divorce in November. He is now remarried and has custody of the couple's three children, though he and his first wife remain good friends and she sees the children often.

Koerber is not prohibited by the terms of his pretrial release from starting or heading up any business ventures. Within those terms, the judge ordered that Koerber actively seek employment, appear at all court hearings relevant to his case and that he not violate any federal or state laws. Melodie Rydalch, spokeswoman for the U.S. Attorney's Office, said her office could not comment on Koerber as the case is still pending in federal court.

As soon as he had the time, Koerber returned to the project and is determined to carry it on. In the meantime, he is certain that, when it comes to the charges against him, the truth will win out.

"The story you tell over time is going to change. There's really no way to see an indictment as a positive. I got indicted. That sucks, but time is on the side of truth. Everyone has an interest in seeing what happens."


COMPLIMENTS OF THE DESERET NEWS

Re-Launching Free Capitalist Radio : FreeCapitalist Daily, by Rick Koerber , Robert Paisola Reports


Re-Launching Free Capitalist Radio

January 21, 2010 by FCD Administrator
Filed under Current, Featured, Principle 13


Re-Launching Free Capitalist Radio. Episode Theme : The Project, Basic Principles of Capitalism, and a Tribute to Dr. W. Cleon Skousen.

The episode focuses heavily on the basic principles of capitalism. Comments about President Obama’s recent remarks about “losing touch with Americans” and a syllogism of Ayn Rand related to Individual Rights, Property Rights, and Liberty.

http://www.freecapitalistdaily.com/2010/01/re-launching-free-capitalist-radio/1078

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