The Official Franklin Squires and Rick Koerber Federal Lawsuit Blog

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

2011-09-30T02:30:00.002-06:00

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
Font Size: Default font size Larger font size

.

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.
.

Copyright 2011 Daily Herald. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

.

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.
.

Copyright 2011 Daily Herald. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

.

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

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

2011-08-02T20:16:00.000-06:00

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"

By Tom Harvey

The Salt Lake Tribune

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.

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

2010-01-28T02:52:00.001-07:00

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

2010-01-21T11:28:00.003-07:00

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

EXCLUSIVE- THE RICK KOERBER 22 COUNT INDICTMENT LIVE! Robert Paisola Reports

2009-11-12T17:37:00.011-07:00

Worldwide EXCLUSIVE

For Immediate Release
CNN I REPORT
ROBERT PAISOLA REPORTS LIVE
FOR WESTERN CAPITAL MULTIMEDIA
Los Angeles, California November 12, 2009 1:00 PM PST

DOWNLOAD THE FULL INDICTMENT HERE!

To our friends around the world:

Since we released the news yesterday that Rick Koerber (Claud R. Koerber) was charged by a Federal Grand Jury on November 09, 2009 with a 22 count Superseding Indictment, we have been trying to get a copy of the indictment for you, our listeners, viewers and readers to review. It appears that the US Attorney in Utah issued a press release announcing the additional charges and "forgot" to file the document in the court!

This is the document that was obtained from the United States Attorneys Communications Liaison:

After going through many layers of government, we were able to get a copy for YOU, the American Public to review!

If you look on PACER, the OFFICIAL COURT RECORD, there is no entry showing this document. Why is that? We will bring you more on that story as soon as we receive additional details, in the interim, here is a link to the official indictment that was never released! How is this possible? Does not the Defendant have a right to see the indictment prior to reading about a document that is not even recorded in the National Media?

DOWNLOAD THE FULL INDICTMENT HERE!

Send comments to Confidential@FRANKLINSQUIRESLAWSUIT.COM

THE TEXT FOR OUR FRIENDS AT GOOGLE!

F1L..ED

U.S. DiSTRICT COURT

BRETI'L. TOLMAN, United States Attorney (#8821) STEWART C. WALZ, Assistant United States Atton¥OO't1tml74)) P 4: 43 TREY MAYFIELD, Assistant United States Attorney (PrOVisionally Admitted)

IN THE UNITED STATES DISTRICT COURT DISTRICT OF UTAH, CENTRAL DIVISION

UNITED STATES OF AMERICA,

Plaintiff,

CLAUD R. KOERBER aJkJa RICK KOERBER,

Defendant.

Case No. 2:09-CR-00302-TS

SUPERSEDING INDICTMENT

VIO. 18 U.S.C. § 1341 (Mail Fraud); 15

U.S.c. §§77q(a) and 77x (Fraud in the Offer and Sale ofSecurities); 15 U.S.C. §§71e(c) and 77x (Sale ofUnregistered Securities); 18 U.S.C. § 1343 (Wire Fraud); 18 U.S.C. § 1957 (Money Laundering Transactions); 26

U.S.C. §-7201 (Tax Evasion)

The Grand Jury charges: The Defendant and His Businesses At all times relevant to this indictment:

1. Defendant CLAUD R. KOERBER (a.k.a. RlCK KOERBER) was an individual with decision making authority over several businesses located in Utah.

2. Founders Capital, LLC (Founders Capital) was a Utah Limited Liability Company fonned in or around April 2005 and associated with Defendant KOERBER. Founders Capital

received investment monies, sometimes termed as loans, from victims of the scbeme and artifice to defraud alleged below.

3. . Franklin Squires Investments, LLC, and Franklin Squires Companies, LLC, were Utah limited liability companies associated with Defendant KOERBER and Founders Capital.

The Scheme and Artifice to Defraud

4. From on or about an unknown date in 2004 to on or about December 31, 2008, in the Central Division of the District of Utah and elsewhere, Defendant KOERBER devised and intend to devise a scheme and artifice to defraud and for obtaining money by means offalse and fraudulent pretenses, representations, and promises. In execution of th~ scheme to defraud, Defendant KOERBER used the United States mails, interstate wire transmissions, and the facilities and means ·of interstate commerce.

5. Beginning around 2004, Defendant KOESER created and presented a series of seminars designed t,o encourage individuals to make money through a real estate program that Defendant KOERBER named the "Equity Mill." It was a part ofthe scheme and artifice to defraud tbat Defendant KOERBER accepted money from individuals and companies through Founders Capital, and with the representation that Founders Capital would use the money to make "bard money" or bridge loans to other entities associated with Founders Capital, namely

...•.

Hill Erickson LLC (Hill Erickson), and New Castle Holdings LLC (New Castle), for the purpose ofacquiring real property for use in the "Equity Mill."

6. Defendant KOERBER communicated his misrepresentations and omissions regarding his schemes, both directly and indirectly, to the different levels ofinvestors and potential investors through various means, including his seminars, phone calls, mailings, and advertisements. Defendant KOEBER made such misrepresentations and omissions to colleagues and intermediaries with the knowledge that such information would be disseminated to other

.investors and potential investors.

7. It was further a part ofthe scheme and artifice to defraud that Defendant KOERBER represented to investors and potential investors that through the "Equity Mill," substantial amounts of money could be made. Defendant KOERBER paid varying amounts of interest on the money provided to Founders Capital,·but most generally 5% per month to its first line investors.

8. It was further a part ofthe scheme and artifice to defraud that the Defendant.

KOERBER caused advertisements to be placed -in "Creative Real Estate Lifestyles" and "Prosperity lifestyles" magazines during 2006 and 2007. The advertisements for Franklin Squires, an entity related to Founders Capital, stated, "Let us show you How to Safely Earn 1-5% Per Month on Your Cash. How to make GREAT MONEY fast in real estate without EVER buying property." The Defendant KOERBER knew these ads were false and misleading because Franklin Squires never made a profit in 2005, 2006 and 2007 and in fact lost money in those years, that the 1-5% paid on investors' money carne from other investors' money as described below, and that the money invested was not safe.

9. It was further a part of the scheme and artifice to defraud that Defendant 3

KOERBER told investors that the investment was risk free or that there was little risk because the investments were backed by real estate.

10. It was further a part ofthe scheme and artifice to defraud that Defendant KOERBER represented to investors and potential investors, "Founders Capital, LLC provides the opportunity to the families to loan their funds directly to Founders Capital, LLC in exchange for an aggressive interest payment and a high degree ofliquidity. Founders Capital, LLC then reloans the money to parties that meet Founders Capital, LLC lending criteria."

11. It was further a part of the scheme and artifice to defraud that Defendant KOERBER also represented to investors and potential investors that the funds loaned to Founders Capital, "Are usually backed, collateralized or secured by real property ofgreater or substantially similar value. The monies are then used by the entities such as Founders Capital, LLC as 'short term' financing to acquire and improve real property investments prior to obtaining more permanent cost effective financing."

12. It was further a part of the scheme and artifice to defraud that Defendant . KOERBER represented to investors and potential investors, "when individuals or families make loans to Founders Capital, LLC typical interest rates on the loaned funds ... range between 110% a month .... Typical levels ofsecurity or collateralization range between 50% and 150%."

13. It was further a part of the scheme and artifice to defraud that Defendant KOERBER knew the above representations were false, or, made these representations false by taking substantial amounts of the money invested with Founders Capital and using it for purposes

other than real estate bridge loans and to purchase real property. Furthennore, most of the money placed with Founders Capital was not secured or collateralized by real estate.

14. It was further a part ofthe scheme and artifice to defraud thatDefendant KOERBER knew that most of the money placed with Founders Capital was not used for real estate purchases and knew that a substantial amount of the money was diverted for other purposes because Defendant KOERBER almost exclusively controlled the use of the funds placed into Founders Capital.

15. It was further a part ofthe scheme and artifice to defraud that Defendant KOERBER used money for purposes not disclosed to the investors and potential investors with Founders Capital, such as for Defendant KOERBER's personal housing, expensive automobiles, investments into restaurants, and investments into other businesses. For example, Defendant KOERBER caused over $850,0000 to be spent on restaurants, $800,000 to be loaned to an associate for a restaurant, and over"$l,OOO,OOO to be spent on expensive automobiles. In addition, Defendant KOERBER caused over $5 million to be spent making a movie.

16. It was further a part ofthe scheme and artifice to defraud that in order to convince earlier investors that their funds were earning money and to convince potential investors that the program was working and earning money, Defendant KOERBER operated the businesses of Founders Capital and related entities as a "ponzi scheme". That is, Defendant KOERBER used money placed with Founders Capital to make interest payments to earlier investors. In this way, Defendant KOERBER created the false impression that the businesses were profitable, that the investments were safe, secure, and that interest was being paid.

17. At no time during the operation of the scheme did the Founders Capital or Franklin Squires entities operated by Defendant KOERBER make a yearly profit. Defendant KOERBER, by means of his misrepresentations and omissions, obtained approximately $100 million in investor funds. It was further a part of the scheme and artifice to defraud that over $50 million ofthose investor funds were used to make ponzi payments.

18. It was further a part ofthe scheme and artifice to defraud that despite the fact that

neither Founders Capital nor Franklin Squires made a profit in 2005, 2006 and 2007, the Defendant KOERBER falsely and fraudulently stated in an article distributed to investors and potential investors that in 2005, the Franklin Squires Companies did $1 n million in revenue and in 2006, the Franklin Squires Companies and the businesses in which Franklin Squires had a substantial interest generated revenues in excess of$500 million.

19. It was further part ofthe scheme and artifice to defraud that the Defendant

KOERBER created a false aura ofsuccess by buying expensive cars, showing photographs of his mansion, claiming that a large "cabin" near Heber, Utah was his second home, despite the fact that he did not own it, and minting his own gold coins. This aura was used to gain credibility with investors and potential investors and induce investments.

20. It was further part of the scheme and artifice to defraud that the Defendant

KOERBER told investors and potential investors that he had gotten in trouble with the Wyoming Division ofSecurities and had gone bankrupt, but had paid all of his investors in Wyoming back without disclosing that he had used some ofthe money investors placed with Founders Capital to make the repayments.

Countt 18 U.S.c. § 1341 (Mail Fraud)

21. The allegations of the Scheme and Artifice to Defraud are incorporated by this reference as though fully set forth herein.

22. On or about July 20, 2005, in the Central Division of the District of Utah,

CLAUD R. KOERBER, Defendant herein, having devised and intended to devise a scheme and artifice to defraud, and for obtaining money and property by means of false and fraudulent pretenses, representations, and promises, and for the purpose ofexecuting said.scheme and artifice to defraud and attempting to do so, did cause to be deposited in an authorized depository for mail matter a letter addressed "To Our Lenders" which contained many of the false and fraudulent representations alleged in the Scheme and Artifice to Defraud; all in violation of 18 V.S.c. § 1341 and 18 U.S.C. § 2(b).

Count 2 through 7 15 U.S.C. §§ 77q(a) and 77x (Fraud in the Offer and Sale of Securities)

23. The allegations of the Scheme and Artifice to Defraud are incorporated by this reference as though fully set forth herein.

24. .Onoraboutthedateslistedbelow,intheCentralDivision oftheDistrict ofUtah,

CLAUD R. KOERBER, Defendant, willfully, in the offer and sale of securities, that is investments in Founders Capital, by the use of the means and instruments of transportation and communication in interstate

commerce and by the use ofthe mails, directly and indirectly. (l) Did employ a device, scheme, and artifice to defraud; (2) Did obtain money by means ofuntrue statements ofmaterial fact and omissions to state material facts necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleadihg; (3) Did engage in transactions, practices, and courses ofbusiness which operated as a fraud and deceit upon investors; all in violation of 15 U.S.C. § 77q(a) and § 77x (securities fraud) and 18 U.S.C. § 2(a) and (b) (aiding and abetting and causing):

Count 8 15 U.S.c. §§77e(c) and 77x; (Sale of Unregistered Securities)

25. The allegations ofthe Scheme and Artifice to Defraud are incorporated by this reference as though fully set forth herein.

26. On or about from July 2005 until December 2008, in the Central Division ofthe District of Utah,

CLAUD R. KOERBER, Defendant, willfully, directly and indirectly, by the use ofthe means and instruments of transportation and communication in interstate commerce and of the mails did offer to sen a security and cause others to offer to sell a security,lhat is, 'an investment in Founders Capital, without a registration statement being in effect as to that security; all in violation of 15 U.S.c. § 77e(c) and § 77x, and 18 U.S.c. §§ 2(a) and 2(b).

Count 9 through 17 18 U.S.c. § 1343 (Wire Fraud)

27. The allegations ofthe Scheme and Artifice to Defraud are incorporated by this reference as though fully set forth herein.

28. On or about the dates listed below, in the Central Division of the District of Utah,

. transmitted by means of wire communication certain writings, signs and signals, each such use of wire cOmn1unication being a separate count ofthis Indictment; all in violation of 18 U.S.C. § 1343 and 18 U.S.C. §§ 2(a) and 2(b)..

Count 18 18 U.S.c. § 1343 (Wire Fraud) .

29. The factual allegations of the Scheme and Artifice to Defraud are incorporated by

this reference as though fully set forth herein.

30. On or about September 21, 2007, in the Central Division of the District of Utah

and elsewhere, CLAUD R. KOERBER, defendant herein, having devised and intended to devise a scheme and artifice to ,defraud, and for obtaining money and property by means of false and

fraudulent pretenses, representations, and promises, for the purpose ofexecuting said scheme and artifice to defraud, did cause to be transmitted by means of wire communications by individual PB, certain writings, signs and signals, that is an interstate email from Utah to Hunter's Capital investors, including an investor in Florida, stating, among other things, "You have known all

along where. your money went and that Rick was using it to do real estate deals."; all in violation

of 18 U.S.C. § 1343 and 18 U.S.C. § 2(b).

Count 19 18 U.S.c. § 1957 (Money Laundering)

31. The allegations of the Scheme and Artifice to Defraud are incorporated by this reference as though fully set forth herein.

32. On or about June 7, 2006, in the Central Division of the District of Utah,

CLAUD R. KOERBER, Defendant herein, did knowingly engage and attempt to engage in a monetary transaction by, through, and to a financial institution, affecting interstate or foreign commerce, in criminally derived property of a value greater than $10,000, that is the purchase ofa 2001 Ferrari 550 Barchetta in the amount of$218,896.27, such property having been derived from a specified . unlawful activity, that is fraud in the sale ofsecurities in violation of15 U.S.C. §§ 77q and 77x; all in violation of 18 U.S.c. §§ 1957 and § 2(b)

Count 20 18 U.S.C. § 1957 (Money Laundering)

33. The allegations of the Scheme and Artifice to Defraud are incorporated by this reference as though fully set forth herein.

34. On or about June 7, 2006, in the Central Division of the District ofUmb,

CLAUD R. KOERBER, Defendant herein, did knowingly engage and attempt to engage in a monetary transaction by, through, and to a financial institution, affecting interstate or foreign commerce, in criminally derived property ofa value greater than $10,000, that is the purchase of a 2004 Ferrari 360 in the amount of $213,459.67, such property having been derived from a specified unlawful activity, thatisfraud inthesale ofsecuritiesinviolation of15U.S.C. §§ 77qand77x; all in violation of 18 U.S.C. §§ 1957 and § 2(b).

Count 21 12

26 U.S.C. § 7201 (Tax Evasion) .

35. The factual allegations ofthe Scheme and Artifice to Defraud are incorporated by this reference as though fully set forth herein.

36. During the year 2005,

CLAUD R KOERBER, Defendant herein, a resident ofthe State ofUtah, had and received a taxable income of in excess of $600,000; that upon said taxable income he owed to the United States of America income tax of in excess of$150,000; that he was required by law on or before October 15, 2006, to make an income tax return to the Internal Revenue Service, and to pay such income tax; that well knowing the foregoing facts, defendant KOERBER on or about October 15, 2006, in the District of Utah, did willfully and knowingly attempt to evade and defeat said income tax due and owing to the United States ofAmerica for the year 2005 by failing to make an income tax return to the Internal Revenue Service, by failing to pay said income tax to the Internal Revenue Service, and by causing various business entities under the control ofdefendant KOERBER to pay personal expenses on his behalf; all in violation of26 U.S.C. § 7201.

Count 22 26 U.S.C. § 7201 (Tax Evasion)

37. The factual allegations ofthe Scheme and Artifice to Defraud are incorporated by this reference as though fully set forth herein.

38. During the year 2006,

CLAUD R. KOERBER,

Defendantherein,a resident ofthe State ofUtah,hadandreceivedataxableincome ofin excess of $300,OOO~ that upon said taxable income he owed to the United States of America income tax ofin excess of $1 00,000; that he was required by law on or before April 16, 2007, to make an income tax return to the Internal Revenue Service, and to pay such income tax~ that well knowing the foregoing facts, Defendant KOERBER, on or about April 16,2007, in the District ofUtah, did willfully and knowingly attempt to evade and defeat said income tax due and owing to the United States of America for the year 2006 by failing to make an income tax return to the Internal Revenue Service, by failing to pay said income tax to the Internal Revenue Service, and by causing various business entities under the control ofDefendant KOERBER to pay personal expenses on his behalf; all in violation of26 U.S.C. § 7201.

A TRUE BILL:

FOREPERSON 0

BRETT L. TOLMAN United States Attorney

Assistant United States Attorneys

Koerber faces 19 new charges

2009-11-11T20:56:00.001-07:00

Video Courtesy of KSL.com

Koerber faces 19 new charges
By Emiley Morgan

Deseret News

Published: Wednesday, Nov. 11, 2009 3:05 p.m. MST
An Alpine businessman, already facing federal charges in an alleged $100 million Ponzi scheme, is now facing a new indictment with 19 additional counts accusing him of entirely new crimes.

Claud "Rick" Koerber, 36, was hit with a three-count indictment in May of this year charging him with mail fraud, wire fraud and tax evasion. Prosecutors handed down a new indictment this week 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.

All of the charges stem from an investment scheme that was allegedly operated by Koerber from 2004 through 2008. 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 states.

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

The indictment states that Koerber was still able to secure over $100 million in investment funds, $50 million of which was used to make "Ponzi payments." Koerber also allegedly spent $850,000 on restaurants, $800,000 on a restaurant venture, $1 million on "expensive automobiles" and $5 million on various money-making ventures.

According to the indictment, the money laundering charges stem from the purchase of a 2001 Ferrari 550 Barchetta, costing $218,896, and a 2004 Ferrari 360 for $213,460. It alleges that these vehicles allowed Koerber to perpetuate the scheme by allowing him to "create a false aura of success," which he also did by showing pictures of his mansion home, a large cabin in Heber that he called his "second home" but didn't actually own, and minting his own gold coins.

Two of the six counts of fraud in the offer of sales and securities arose from advertisements Koerber allegedly distributed in magazines telling investors they could "safely earn 1 percent to 5 percent per month on your cash."

Koerber has vehemently denied that he has been involved in any wrongdoing, even holding a press conference in late May to proclaim his innocence. His attorney, Marcus Mumford, was just added to the case in late October and knew at the time he was appointed that prosecutors had planned on filing an indictment with additional charges. However, he said he had to find out about it by way of a press release, though he said he had just talked to prosecutors.

When contacted by the Deseret News, Mumford said he didn't believe the multiple new counts were based on new information.

"Judging from the press release, the government seems to be stretching the same allegations over more and more charges," he said. "These are the same allegations that the government first asserted in the course of an investigation which an independent government auditor said was inappropriately conducted."

Mumford said a state auditor found that the conduct of the Utah Department of Securities in the investigation of Koerber was "inappropriate" and "inconsistent" because the department failed to "follow established policies and procedures." Mumford said the woman who headed up that investigation is now leading the government's case, so his office plans to discover what the specific issues were within the investigation.

Regardless, Mumford said his client is optimistic.

"Mr. Koerber remains upbeat and is taking these new developments in stride," Mumford said. "We are as eager to defend Mr. Koerber against these new charges as we were the old ones."

Koerber faces a maximum penalty of 20 years in prison if convicted of mail fraud. The fraud in the offer and sale of securities counts carry potential maximum sentences of five years per count, as does the sale of unregistered securities. The 10 wire fraud counts each carry a potential sentence of 20 years. The two money-laundering transaction counts carry a potential 10-year sentence, and the tax evasion counts, from 2005 and 2006, carry potential penalties of up to five years. Each count in the indictment also includes a potential fine of $250,000.

Rick Koerber now faces 22 counts

2009-11-11T09:15:00.000-07:00

(AP)Federal prosecutors filed 19 additional charges Tuesday against Rick Koerber, saying the Utah County man failed to tell investors who poured more than $100 million into his real estate investment program that his FranklinSquires Cos. were not earning a profit.

In the new indictment, Koerber, of Highland, now faces one count of mail fraud, six counts of fraud in the offer and sale of securities, one count of sale of unregistered securities, 10 counts of wire fraud, two counts of money laundering and two counts of tax evasion.

Koerber, 36, was originally indicted in May on three charges -- one count each of tax evasion, mail fraud and wire fraud. Prosecutors alleged the businesses he directed collected more than $100 million but used about half of that to pay back other investors and make it appear the operations were profitable.

U.S. Attorney Brett Tolman said the investigation was ongoing and that more charges could be filed against Koerber and others associated with the companies.

"We will continue to look at other leads that we have and, whether those leads are concerning Mr. Koerber or others, we are continuing to follow up on those," he said.

According to the new indictment, Koerber falsely stated in mailings and magazine advertisement distributed to investors and potential investors that the FranklinSquires Cos. and related entities had $111 million in revenue in 2005 and more than $500 million in 2006. But, the indictment
Advertisement
says, neither FranklinSquires nor subsidiary Founders Capital made a profit in 2005, 2006 and 2007.

It also alleges that "at no time during the operation of this scheme did Founders Capital or FranklinSquires entities operated by defendant Koerber make a yearly profit."

Reached by phone Tuesday evening, Koerber said he was unaware of the new charges until told about them by a reporter and would have to consult with his attorney before reacting to them.

Previously, Koerber has adamantly denied he was operating a Ponzi scheme. He said that his businesses had plenty of equity in real estate to pay back investors until the bottom fell out of the U.S. real estate market.

The new indictment lays out an alleged scheme in which Koerber promoted his real estate investment program, "Equity Milling," to investors.

According to the U.S. Attorney's Office, Koerber "communicated his misrepresentations regarding his schemes, directly and indirectly, to different levels of investors and potential investors using various means such as seminars, phone calls, mailings and advertisements. Koerber also made misrepresentations to colleagues and intermediaries with the knowledge that such information would be disseminated to other investors and potential investors."

The indictment says instead of real estate transactions, Koerber used some of the investor funds for personal housing, expensive automobiles, investments in restaurants and other businesses.

The money laundering count alleges Koerber used investor money to buy a 2001 Ferrari 550 Barchetta for $218,896 and a 2004 Ferrari 360 for $213,459.

Michelle and Rick Koerber Confirm Divorce, Robert Paisola Reports

2009-11-05T16:45:00.004-07:00

An open note:

Why this has any bearing on what Koerber is going through is beyond our understanding. He is a public figure, and he openly states that this is an uncontested divorce. Why do we have to drag someone down even farther than they are... Just a thought..

This is a STORY from The Salt Lake Tribune. This is NOT a Western Capital Multimedia Story and we take no part in this stories creation. This is completely irrelevant to the facts of the Rick Koerber and Franklin Squires Matter.

Provo » Rick Koerber, the Utah County businessman accused of running a huge real estate fraud, and wife Michelle are divorcing.

The Koerbers filed a joint petition and accompanying documents late last month, waived a 90-day waiting period and are waiting a judge's signature to finalize the divorce, according to 4th District Court records in Provo.

Koerber declined to comment Tuesday except to confirm that "Michelle and I are finishing up an uncontested divorce."

Koerber is facing fraud and tax-evasion charges in federal court in Salt Lake City. He's accused of enticing investors into his real estate investment operations grouped around FranklinSquires Cos. The May indictment alleges that about half of at least $100 million of investor money was used to make payments to other investors in what prosecutors say was a Ponzi scheme.

Koerber vigorously denies the allegations and intends to contest them in court.

Michelle Koerber also declined comment Tuesday on the divorce when reached by telephone. But later, after speaking to Koerber, she called back to say she will continue to support her husband and believes in his innocence.

"I support him 100 percent in this fight he's making," she said. "I claim that he's innocent. I think that he's innocent. I'd stand up for him in a heartbeat."

Rick Koerber, too, said he expects Michelle will continue to support him.

The couple were married in 1999 in Colorado and have three children, ages 4 and under.

In their petition to the court, the couple agreed to share custody of the children but with Rick Koerber having physical custody and Michelle to have substantial time with them.

No alimony was sought.

Rick Koerber claimed an income of $3,250 a month from KF Reserve LLC and Western States Restaurants LLC. Both are companies in which he apparently has an ownership interest.

According to Department of Commerce records, KF Reserve is the successor company of Franklin Squires Investments, a company registered in 2003 by the Koerbers.

In registration documents filed with the state in July, Michelle Koerber and Jewel Kimber Skousen, an employee of Rick Koerber's Free Capitalist Project, are listed as managers of Western States Restaurants. Michelle Koerber, however, was removed as a manager in an Oct. 12 filing, 10 days before the couple filed for divorce.

Rick Koerber fires Attorney Jerome Mooney, Brings in Los Angeles Attorney Marcus Mumford, Robert Paisola Reports

2009-10-26T07:47:00.004-06:00

A federal magistrate overseeing the case of an Utah County businessman accused of running a $100 million Ponzi scheme said Friday that he thinks the case is "languishing" and is eager to move it forward.

Even as federal prosecutors said in court Friday that they plan to present Claud "Rick" Koerber, 36, of Alpine with a "superseding indictment" that will stack additional counts onto an initial three-count indictment filed in May, the primary concern of federal magistrate Samuel Alba was that of time.

"This is languishing as a case," Alba said. "I want to make sure it gets to trial in a reasonable time."

Koerber was charged with mail fraud, wire fraud and tax evasion in connection with an investment scheme that began in 2004 and continued through 2008. 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 states.
Instead, prosecutors say, the investors' money went to Koerber's dining expenses totaling $800,000, new vehicles totaling $1 million, and his movie-making ventures costing $5 million. Koerber still vehemently denies the charges and pleaded not guilty in June.

On Friday, Koerber dismissed his court-appointed attorney, Jerome Mooney, and retained his own counsel, Marcus Mumford. The judge gave prosecutors and Koerber's defense one week to create a plan for transferring documents and then 90 days to decide what kinds of motions they plan to file.

Mumford said after the hearing that he hasn't received any documents regarding Koerber beyond those given to them by Koerber in June. "The government has represented to the media that they have 'mountains of evidence,' but, frankly, we haven't seen that from them," Mumford said.

Assistant U.S. attorney Stewart Walz said the U.S. Attorney's Office plans to file an updated indictment "within the month" that will include additional counts against Koerber.

Deseret News

Marcus Lamonte Mumford - #190708
Current Status: Active
This member is active and may practice law in California.
See below for more details.
Profile Information
Bar Number
190708
Address
Ofc Public DefenderP O Box 3428Modesto, CA 95353-3428
Phone Number
(209) 525-4200
Fax Number
Not Available
e-mail
Not Available
District
District 5
Undergraduate School
Univ of California Berkeley; Berkeley CA
County
Stanislaus
Law School
Thomas Jefferson SOL; San Diego CA
Sections
None
Status History
Effective Date
Status Change
Present
Active
12/4/1997
Admitted to The State Bar of California
Explanation of member status
Actions Affecting Eligibility to Practice Law
Disciplinary and Related Actions
This member has no public record of discipline.
Administrative Actions
This member has no public record of administrative actions.

'Latter-day capitalist' Rick Koerber: Rags to riches and back again, Our Position by Robert Paisola

2009-10-18T15:20:00.005-06:00

'Latter-day capitalist' Rick Koerber: Rags to riches and back again"

Now facing charges, Latter-day capitalist Rick Koerber built a $100 million operation in Utah County only to end up broke.

Salt Lake Tribune

Back in 2006, Rick Koerber was a phenomenon.

He could charge up to $2,000 for his real-estate investing seminar and 200 people would show up.

So entranced were investors by Koerber's "Equity Mill" program that they poured at least $100 million into businesses operated under the FranklinSquires Cos. name.

Koerber called himself a "Latter-day capitalist." He had his Free Capitalist Project, a "university" and a radio program. He supported the failed school voucher movement and flexed political muscle against regulators. He had Ferraris and Maseratis and an Alpine mansion.

Then in 2007, credit tightened and housing values plummeted. The companies stopped making interest payments; lawsuits followed. Koerber lost his home and his car.

In May, a federal grand jury indicted him for operating an alleged Ponzi scheme, charging him with mail and wire fraud and tax evasion. More charges are expected.

Koerber claims innocence.

"Honestly," he said of himself and his partners, "we weren't that experienced in business, and we weren't that experienced in real estate. We were just ambitious."

A history

Claud Roderick "Rick" Koerber was born March 6, 1973, in Casper, Wyo., to an unmarried cocktail waitress. He never met his biological father.

When he was about 6 months old, his mother, Linda, married Ted Edward Koerber, who adopted Rick. They divorced when the boy was about 4 .

"He was a big drunk, an alcoholic," Koerber said in an interview before the indictment. He saw Ted only once after the divorce, visiting him in jail at Christmastime.

Linda raised him in Casper with her parents' help. Koerber excelled in debate in high school, but by 17 found himself searching for a foundation.

On a rainy Easter Sunday, he answered the door to Mormon missionaries. "I said, 'Tell me, does God have a Dad?' That's how I started. Less than a month later, I got baptized."

LDS capitalist

Koerber's LDS religion would figure prominently in his life and Utah businesses. But some think he went too far.

In at least one presentation in St. George, Koerber announced the presence of Hartman Rector Jr., a former LDS general authority. Gordon Hamm, a software engineer in attendance, thought Koerber's actions were inappropriate.

"The church wouldn't have wanted that, and that was my beef," said Hamm, who wrote Koerber and Rector letters protesting the implied endorsement.

Members of several LDS wards Koerber lived in also invested, influenced by his church membership, said David Doerr, a real estate broker who Koerber sued over comments on a blog.
"I know of at least two families who lost their homes because they invested," said Doerr, who attended the same Spanish Fork ward as Koerber. "But that's the tip of the iceberg."

James W. Smart of Salt Lake City cited religion as a factor when he and his wife invested equity from their home with Gabriel Joseph, a co-founder of FranklinSquires Cos. who ran one of the companies, Annuit Coeptis, that also fed money into the operation.

"He'd say the right things ... 'Some people use the money to go on missions' and stuff like this," said Smart, a church employee.

Wyoming failure

Koerber got an associates degree in liberal arts and general studies from Casper College, then attended the University of Denver on a debate scholarship from 1993 to 1996, studying religion and public policy but apparently never graduated.

He went to work for Xerox and managed to save $10,000 that he used to start a company that fixed computers. He returned to Wyoming and also formed Global Central, an Internet service provider. The company did well, according to Koerber, and in 2000 he decided to take the parent, National Business Systems, public. In doing so, he ran afoul of Wyoming regulators who alleged he misled investors about the company's financial condition and failed to reveal most of the money would fund sales commissions and current operations costs.

By September 2001, Koerber and wife Michelle filed for bankruptcy. In court, the couple listed their cash on hand as $5.

Flat broke, the couple moved to Orem, where Koerber wanted to become an LDS seminary teacher.

Lessons learned?

The Wyoming sanctions weighed on Koerber.

In organizing FranklinSquires in 2004 with seven former students from his seminars, Koerber said he consulted an attorney because he didn't want to get in trouble with regulators. He said the attorney told him, "If you're all business partners and you're all actively involved in managing the company and you're all using your own money, no problem."

But then, Koerber said his insurance agent, Les McGuire, asked him about investing after seeing Koerber's financial records when he purchased a policy.

Koerber went back to attorneys to see how McGuire, who later died in a plane crash, could invest. The question was how he could accept outside investors without registering with the state Division of Securities or federal Securities and Exchange Commission, which would trigger a number of requirements about disclosing financial and other information about the company and its owners.

He said he learned he could bring McGuire on as a partner. That advice led to the creation of Founders Capital, owned 50 percent by McGuire and the other half by FranklinSquires.

"Once we did that we did not have to comply with all these other regulations," Koerber said. "We had good attorneys giving us that advice."

Humble beginnings » Once in Orem, Koerber and his wife found a home they rented for $800 a month, though it was strewn with mouse feces.

Koerber studied to become a seminary teacher but said he eventually was told he could not teach LDS religious classes unless he made good with Wyoming investors.

"I didn't want to be in business; I wanted to pay back the investors I had from my previous business," he said.

Koerber had seen an infomercial for the Carleton Sheets investment program that promised to teach "how to invest in real estate with no money down." Without a credit card, he couldn't get the program, so he went to work as a telemarketer for FranklinCovey Coaching, which sold it.

"At night I'd go over and read it and pretty soon I made copies of it," Koerber said. "I'd sneak the videos out and watch them."

Using what he learned, Koerber and his wife bought a Spanish Fork home for $135,000 from owners willing to finance the deal themselves with no money down. The monthly payment was $805 for a house nearly identical to Koerber's in-laws' two blocks way.

"They worked their whole lives to have this house, and here I was this failure in business who had no money and no credit and we're moving into this house and I had increased my expenses $5 a month. I thought I was the smartest guy in the world and I said I got to do this some more. ... It was like hallelujah."

'Equity Milling'

Koerber built on the Carleton Sheets method to create his "Equity Milling" program. He began buying and selling houses and sharing his technique, charging students as much as $2,000.

"I thought to myself, geez, one or two sales a month and you're going to make as much as you make as a seminary teacher."

Dennis and Marietta Baca, a retired couple from Aurora, Colo., in September 2005 received an invitation from Koerber for a Denver seminar conducted by Gabriel Joseph, one of FranklinSquires owners.

According to a lawsuit they filed in Colorado, Joseph described Koerber as a "brilliant real estate investor" and encouraged attendees to sign up for an instructional program. The Bacas paid $7,285 for an Internet-based course and also traveled to Provo for classes.

The Bacas borrowed $55,000 against their rental property and used $40,000 from her 401(k) to invest in Koerber's operations. Eventually, they put in another $30,000 from credit card advances.

They received monthly interest payments until the checks stopped in October 2007.

'God is a capitalist' » His clients, Koerber said, were usually people "looking to supplement their income or get out of what they were doing."

"They stayed up at night watching get-rick-quick infomercials ... Most of these people were average lower middle-class people who didn't like being lower middle class."

For the once-broke Koerber, 36, and his partners, most 30-something Utah County residents, the money flowed in -- so much so that the lead-in song to his Free Capitalist show was "Money, Money, Money." by Abba.

Koerber graduated from the Spanish Fork house to a 13,850-square-foot mansion in Alpine.

At meetings and on his radio show in July 2008, Koerber told a story about the expensive automobiles he and others viewed as advertising their companies' success.

Koerber said he went to a car dealership with Joseph, who wanted to buy a new Ferrari.

"I had driven my lowly Maserati up there to get worked on," Koerber said. "Basically I was sitting there and didn't want to drive a loaner car back home ... So I found a Ferrari on the showroom floor ... and so I bought it for $205,000 and wrote a check for it."

But telling the story -- with relish --- on his radio show, Koerber was incensed by a listener who criticized him because he found the story clashed with Christian teachings.

"God is a capitalist, my friend," Koerber told listeners and his critic.

When Koerber drove the car home, a neighbor who owned a minivan remarked that people in other parts of the world were starving. But Koerber would have none of that, particularly after selling the new Ferrari a few months later for about $20,000 more than he paid.

"So I drove that car around for two months and it cost me less than it cost you to drive around in your self-righteous minivan," he said.

Out of control

After McGuire, who died later in a plane crash, bought in through the creation of Founders Capital, a real estate broker named Paul Bouchard who operated Hunters Capital asked about investing, Koerber said.

Other people set up funds and also began to "lend" money, with Founders Capital agreeing to pay, according to the indictment, around 5 percent per month. A number of these feeder funds began to create their own "downlines" of investors in which each person who recruited new money got a piece of the interest.

Koerber insists the funds and individuals were not investors but made loans, a legal distinction that could come into play in the government's case against him.

Federal officials declined to provide an estimate of the number of people involved, saying only it could be in the hundreds. David Shipley, a certified investment adviser, said FranklinSquires was all the buzz among some Utah County investors.

"If I were to guess, more money from Utah County investors ... went into this project, to put it politely, than any other business that ever has come into this area," Shipley said.

Koerber said his obligation is only to first-line lenders with whom Founders Capital had a contractual relationship.

He did not initially know of or encourage perhaps the largest investor, Hunters Capital, or others to form downlines of investors, Koerber said. Promoters such as Bouchard used him and his seminars to solicit investments without his knowledge, he claimed, even though he acknowledged Bouchard was a friend whose offices were in the FranklinSquires building.

"He would take a guy, a neighbor who wanted to invest and he would bring [him] to one of my seminars. He would use that as credibility. The next day he'd say 'OK, give me $200,000 and I'm just going to loan it to Rick.' "

Bouchard, who did not return a voice mail seeking comment, sent more than $10 million he gathered in Founders Capital. He pleaded no contest to criminal charges and has been ordered to repay $8.83 million.

Huge annual return

Koerber denies running a Ponzi scheme, and blasts the government for loosely throwing around that term. He said he told investigators the investments were all backed by equity in property or businesses.

"I can't say we've never paid interest with new capital," Koerber said. "That's not a big deal, and all our investors know that. But on balance, we're by far in the black in terms of more assets than liabilities."

Yet to meet its obligations of 5 percent or so a month, the "equity milling" operation would have had to produce a huge annual return. For example, $100,000 at a simple interest rate of 5 percent per month would mean that the funds would have had to return an interest rate of 60 percent after a year or $60,000 to meet the company's obligation. Interest compounded monthly would mean a return closer to 80 percent would be required.

"I don't see legitimately how anybody could take that promise [of investing in real estate as FranklinSquires did] and make a 5 percent a month return on investment," said Tom Eldredge, a partner at the Grant Thornton accounting firm in Salt Lake City. "That's very unusual."

Plus, the indictment alleges about half of the $100 million taken in by FranklinSquires was used for purposes other than real estate investing, thus making meeting its obligations even less probable.

'A lot of freakin' money'

In 2007 the housing bubble that provided the fuel for the "equity mill" to work on such a large scale burst, bringing Koerber's operation down. FranklinSquires had assets in the form of houses all over the country, Koerber said. But as prices fell, it no longer had equity in the houses and, even if it could sell, wouldn't make a profit needed to service its debt.

"So we became illiquid," Koerber said.

By that time, the 50 entities involved in raising money for Founders Capital had shrunk to nine. But to those, FranklinSquires still owes about $30 million after reducing the debt from $120 million, much of it through trading equity in FranklinSquires.

That $30 million is "still a lot of freakin' money," Koerber said, but he vowed to pay it back "even if takes another two years or five years."

Meanwhile, in court Koerber finally agreed in a foreclosure proceeding to vacate his mansion. The bank repossessed his Mercedes S600. A court-appointed attorney represents him.

Ripples in the pond

The FBI and the state Division of Securities continue to investigate. At least 13 of the investor companies face lawsuits or sanctions from regulators. More federal charges are expected.

Smaller investors are out the equity in their homes and are working to save again for retirement or to repay money borrowed on credit.

Doerr, the broker, said real estate in Utah County where FranklinSquires or its students bought homes likely will show still greater effects from falling prices and evaporated equity.

Some county residents now own investment homes they must pay mortgages on until they figure out what to do with them, said Shipley, the financial adviser. Others have second or first mortgages on homes they had already paid off.

"Especially for Utah County, some of the worst stories are the couples who are retired and put the entire equity value of their house or their entire life savings into this organization," Shipley said. "Now they don't know whether they have anything to show for it."

This is a story that appeared today. We will provide our commentary on an upcoming post on this site as well as over the Western Capital Multimedia Network

Robert Paisola
CEO
The Western Capital Foundation

A.G. denies political pressure swayed Koerber case

2009-06-26T00:23:00.000-06:00

A.G. denies political pressure swayed Koerber case

Alleged scheme » Office says there wasn't enough evidence; feds then took the case.

By Robert Gehrke

The Salt Lake Tribune

Salt Lake Tribune

Updated:05/29/2009 09:26:52 PM MDT

The Utah Attorney General's Office declined to take action in late 2007 against Rick Koerber, the "Free Capitalist" charged this week with running a massive Ponzi scheme, but officials from the office say the decision had nothing to do with pressure from Koerber or a state lawmaker.

The Utah Division of Securities, which had been investigating Koerber's complex web of businesses, prepared a civil complaint against the Alpine businessman at the end of 2007 and took it to Kirk Torgensen, the chief deputy at the attorney general's office, for screening.

"They declined to file the case," said Francine Giani, director of the Utah Department of Commerce.

Torgensen said the information given the attorney general didn't have the supporting evidence that would have been needed to file the complaint.

"All we had presented to us at that point was a bare-bones complaint," he said. "What we specifically requested was all the evidence and information to support each of the allegations in the complaint. ... Had that follow-up information been provided, we would have proceeded on the case in a normal course of business."

Koerber said he was relieved when he heard the attorney general's office had decided not to file the case. "I figured, finally, somebody with some common sense," he said.

Instead, Giani said she made the decision to take the information the division had gathered and turn it over to the U.S. Attorney's office, which announced a criminal indictment against Koerber this week.

The decision not to pursue the civil complaint came on the heels of a series of meetings that Rep. Carl Wimmer, R-Herriman, arranged with several powerful officials, including then-House Speaker Greg Curtis, Attorney General Mark Shurtleff, Torgensen and several other state lawmakers.

It also came shortly after the legislative auditor -- at the request of Wimmer and Rep. Jim Bird, R-Sandy -- had launched an audit of the securities division.

Mark Pugsley, a Salt Lake City attorney who frequently battles the division and until recently served on the division's advisory board, said individuals in the division have told him that there was considerable political weight thrown behind Koerber.

"There were political pressures as I understand it that were brought to bear with regard to that case and Mr. Koerber is connected and involved politically and I think he used those contacts he had to put pressure on the state to drop the case," Pugsley said.

In an interview Friday, Koerber said he never asked Shurtleff or Curtis for favors, but he wanted the government to be fair and Shurtleff assured Koerber his office would be.

"I said 'They're on a witch hunt and I have some evidence to back that up,'" Koerber said. "[Shurtleff] said 'We're not in the business of rubber-stamping any witch hunt.' He said, 'Relax, the Department of Commerce doesn't control the Attorney General's Office.'"

Torgensen said those meetings in no way influenced the attorney general's decision.

"No. No. Absolutely 100 percent no," he said. "Nothing Mr. Koerber said, nothing he protested, influenced the outcome of this case. Nothing. And that's the absolute truth, not from Mark Shurtleff's perspective, not from my perspective."

Torgensen said Shurtleff told him to "take the case wherever it leads," and Wimmer has said he simply arranged meetings like he would for any Utahn, and didn't advocate on Koerber's behalf.

"The idea that I tried to interfere with this investigation is just ludicrous," Wimmer said.

This week -- nearly 18 months after the attorney general's office first declined the matter -- U.S. Attorney Brett Tolman announced a three-count indictment against Koerber, alleging he convinced investors to invest $100 million with his businesses.

Half the money was used to pay supposed dividends to early investors, while the rest was used to finance a lavish lifestyle, including $1 million spent on cars, and $5 million he invested in the movie "Evil Angel," according to prosecutors.

Melodie Rydalch, spokeswoman for the U.S. attorney, said the information provided by the securities division was used as reference, but the FBI and IRS did their own investigation.

On Friday, Koerber, flanked by a handful of business associates and supporters, held a press conference at the Grand America Hotel, firing back at the state regulators. He played snippets from recorded conversations with regulators, where they expressed reservations about the case and told Koerber that he "had not broken any rule or law."

Koerber called charges in the federal indictment "absurd and bogus," adding, "I am confident that I will be exonerated and that the allegations contained in the indictment will be shown to be patently false."

Koerber also said he plans to file a federal civil rights lawsuit against several current and former state officials.

Utah lawmaker wanted heads to roll for 'my friend'

2009-06-26T00:18:00.001-06:00

Rep. Carl Wimmer said Wednesday that he had asked Gov. Jon Huntsman Jr. to fire the head of the Utah Department of Commerce during its investigation of Rick Koerber, who last month was indicted on federal charges of running a multimillion-dollar Ponzi scheme.

A series of e-mails from Wimmer, obtained through an open records request, also shows that the Herriman Republican had gone to the governor with concerns about the "witch hunting" of Koerber and offered his help to the indicted businessman, whom he referred to as "my friend."

Wimmer had previously acknowledged arranging meetings for Koerber with Attorney General Mark Shurtleff and various legislators, including then-House Speaker Greg Curtis, and appearing on Koerber's radio program.

He also spoke at a Koerber event in Provo last April, but insists that he gave no special treatment to Koerber, who he considers an acquaintance and political supporter, not a friend.

In January 2008, Wimmer e-mailed Tani Downing, the governor's general counsel, seeking a meeting with Huntsman, Shurtleff and Koerber to discuss a $30 million lawsuit Wimmer said Koerber planned to file against the Commerce Department for damages "due to the last three years of witch hunting."

"The governor needs to know the depth of what is happening here ... it's enormous," Wimmer wrote.

Wimmer said Wednesday that he didn't meet with the governor, but met with Downing and gave her a packet of information that Koerber had collected, including letters and transcripts of phone conversations with Commerce Department officials.

A few months earlier, Wimmer had joined Rep. Jim Bird, R-West Jordan, in requesting an audit of the Commerce Department's Securities Division based on allegations that officials there had abused their investigative powers and persecuted Utah businessmen, including Koerber.

"I wanted to make sure that was not the case here. If that was the case, I thought it could cause tremendous embarrassment to the governor, and I wanted to make sure he had that information," Wimmer said.

The audit released in July 2008 found that the Securities Division had used coercive tactics and overstepped its authority. It mentioned Koerber's case only to say auditors did not examine that ongoing investigation.

The Herriman Republican also said Wednesday that, before the meeting with Downing, he had urged the governor to fire Commerce Director Francine Giani, because he believed her agency was "out of control." He said that was based primarily on the allegations that led to his audit request and a disparaging e-mail that Wayne Klein, the former head of the Securities Division, sent to Shurtleff in 2007.

In the e-mail, Wimmer said, Klein warned Shurtleff not to believe Wimmer's advocacy for Koerber because Wimmer was an investor in his businesses.

"There was zero truth to this e-mail. Zero truth," Wimmer said. "It was made up to disparage me and make me look bad, and this was allowed by [Giani's] office and that should not be allowed."

Wimmer says he didn't invest money with Koerber, but he had taken an investment course that Koerber offered, which Wimmer never completed.

"The governor has trusted Francine and supported her in her efforts to do her job and accomplish the mission of the department," said Huntsman's spokeswoman, Lisa Roskelley. She said the governor was briefed occasionally on the status of the Koerber probe.

In another e-mail Wimmer sent in January 2008, the legislator asked Koerber about an event Koerber was planning, at which Wimmer hoped to speak and solicit donations and volunteers for his re-election campaign.

"Being that I would benefit greatly from this, I'd be happy to help coordinate or plan it," Wimmer wrote. "I have about three weeks left to fundraise, then I'm in [legislative] session." Donations to lawmakers are banned during the 45-day session.

Wimmer joined Bird that year in sponsoring legislation that would have stripped the Division of Securities of much of its enforcement power. The bill failed but a watered-down version passed this winter.

Both the request to meet with the governor and the correspondence with Koerber came just a few weeks after the Commerce Department had asked Shurtleff's office to file a civil complaint against Koerber.

The attorney general's office balked at filing the case, seeking more evidence, which Chief Deputy Attorney General Kirk Torgensen previously said -- and the office reiterated Wednesday -- never came. Instead, Giani took the case to the U.S. attorney, who charged Koerber on May 26.

In mid-April 2008, Koerber contacted Wimmer, thanking the representative for what he had done "to assist me and my associates," and informing Wimmer that he had been receiving death threats "as a result of the lies coming from the Department of Commerce."

Wimmer provided Koerber with Shurtleff's e-mail address and offered his sympathies. "I am so sorry that you are going through what you are, Rick," Wimmer wrote. "I want to help get you through this garbage."

"Let me know what else I can do for you," Wimmer wrote, and updated Koerber on the status of his concealed weapons permit that had been stalled at the Bureau of Criminal Investigation. "Your permit should be there any day!"

By Robert Gehrke

The Salt Lake Tribune

Rick Koerber, CEO of Franklin Squires arraigned in Federal Court in Salt Lake City, Utah, Robert Paisola Reports

2009-06-19T13:16:00.005-06:00

For Immediate Release
by: Robert Paisola
Copyright 2009 Western Capital Multimedia, All Rights Reserved
801-619-4700

SALT LAKE CITY, UT. — Appearing upbeat and with a big smile, Rick Koerber, the CEO of Franklin Squires Companies left the Federal Courthouse in Salt Lake City, Utah flanked by his attorney Mr. Jerry Mooney, a Salt Lake City lawyer and past president of the First Amendment Lawyers Association, his wife and his personal assistant, eager to chat with the media. This is the first public appearance since Claud R. Koerber was charged in a three count indictment last month.

Federal prosecutors charged Koerber, the President and Chief Executive Officer of The Franklin Squires Real Estate and Financial investment Company, with operating a Ponzi Scheme, claiming to have reached 100 Million Dollars at its prime.

Koerber followed suit with the United States Attorney in Utah, Brett Tolman, held a news conference to announce the return of a grand jury indictment charging Koerber. Koerber then determined that he would hold his own press conference from the luxurious Grand America Hotel, in Salt Lake City.

Watch the Full Press Conference Live Here.

The Official Rick Koerber Franklin Squires Indictment Video by Robert Paisola

In the courtroom, flanked by U.S. Marshals, Koerber rocked back and forth, staring at U.S. Magistrate Alba as he carefully enunciated the charge against him. He asked him if he was, in fact, the Claud R. Koerber suspected of the crimes, and he said, "Yes."

After stating his claim of NOT GUILTY, Koerber was then provided with a list of restrictions outlined on the Order Setting Conditions of Release that he can not violate, including the requirement that he turn in his United States Passport, Maintain or actively seek employment, Maintain residence and do not change without prior permission of Pretrial Services, No travel outside the State of Utah without prior written permission of Pretrial Services, avoid all contact with the following named persons who are considered either alleged victims or Potential Witnesses (NO NAMES PROVIDED ON COURT ORDER) (WHERE ARE THE VICTIMS AND WITNESSES?) refrain from possessing a firearm, destructive device or other dangerous weapon, to obtain no additional passport, and to report on a regular basis to the supervising officer as directed, and was ordered to be processed and released by the United States Marshals.

If convicted on the federal charges, Koerber could spend a maximum of 45 years in federal prison and face a large fine.

The United States Attorney in Charge of the case turned over 7 DVD's containing the evidence that will be used to support the charges that were primarily indexed by Koerber on the first 5 disks at an estimated personal cost of $80,000.00 to his firm .

Outside the courthouse, Attorney Jerry Mooney, called this a "complex Financial Case" and carried with him what appeared to be the 7 DVD's of data that was presented in court, partially prepared by Koerber!

Koerber commented in an exclusive interview with Robert Paisola of Western Capital Multimedia

"I am eager to have my day in court and I am convinced that upon presentation of the evidence against me that I will be fully vindicated, he continued, "It truly amazes me that the data that we were given today is partially the same data that I provided the State of Utah in my own defense!" he concluded by stating " Where are the Victims? Where are the Witnesses?" The judge himself gave me a document that you have Rob, that states on page 2, paragraph 7(D)not to have contact with the Victims or Witnesses.... but there are no names"

Could that be why there are no victims listed in the indictment?

Koerber stated that he has hundreds of hours of Audio, Video and Documented data that we were privy to prior to the indictment. WCM has not seen the investigative data that was presented at today's hearing.

Koerber will appear in court again on August 31, 2009 .

RICK KOERBER - THE PRESS CONFERENCE NOW LIVE, By Robert Paisola

2009-06-08T11:25:00.000-06:00

THE RICK KOERBER PRESS CONFERENCE RELEASED IN HD VIDEO- UNEDITED!

The Official Rick Koerber Franklin Squires Indictment Video by Robert Paisola - The most amazing bloopers are here
This is the official link to the full Rick Koerber Franklin Squires Press Conference. This is a 38 Minute UNEDITED Video. We will provide more details as they come in, Stay tuned for further details.

WATCH THE FULL RICK KOERBER FRANKLIN SQUIRES INDICTMENT PRESS CONFERENCE IN HD VIDEO NOW!

To your Success

Robert Paisola
CEO
RobertPaisola.com

PRESS RELEASE

* RICK KOERBER RESPONDS TO FEDERAL INDICTMENT
* ANNOUNCES A MULTI-PARTY FEDERAL CIVIL RIGHTS LAWSUIT, AND
* RELEASES TRANSCRIPTS AND RECORDINGS OF STATE OFFICIALS ENGAGING IN CRIMINAL VIOLATIONS OF UTAH LAW AND OF THE STATE’S CHIEF INVESTIGATOR CLEARING HIM OF ANY WRONGDOING

SALT LAKE CITY -The following statement was delivered by FranklinSquires President & CEO Rick Koerber at a press conference held at the Grand America in downtown Salt Lake City, UT at 3:30pm on Friday May 29, 2009-
.PDF version of Mr. Koerber’s Remarks (This .pdf version contains footnotes describing the source of each quote and/or sound clip, these footnotes are omitted in the .html version)

“My name is Rick Koerber and I am the President and CEO of FranklinSquires. In 2004 employees within the Utah Department of Commerce first contacted me and informed me that my business was being investigated for what the Division of Real Estate deemed “suspicious behavior.” During an in person meeting with several Department employees I was told that “while there was not currently any evidence to support their suspicion” I was being investigated for fraud. The investigation grew and expanded to last more than five years and it included the Division of Real Estate, Consumer Protection, Securities, Licensing, and the Division of Corporations & Commercial Code. After failing to find any evidence that I was involved in breaking any “rule or law” and after failing to convince any state agency to take civil or criminal actions against me, and specifically after their own attorneys suggested there was not sufficient evidence to bring charges, Francine Giani continued shopping for a prosecutor until in January or February of 2008 when, as she recently admits, she had the files sent to the US Attorneys office.”

“As you all know, after several years of speculation, conjecture and an extended whisper campaign of rumors and grand jury leaks, on Tuesday of this week a three count indictment was returned by a federal grand jury accusing me of certain crimes supposedly committed between 2004 and December 31, 2008 related to a purported “$100 million dollar Ponzi-Scheme.”

RESPONSE TO INDICTMENT

“In response to this indictment I can only say that the allegations made therein are absurd and the charges are false. Up until now everything done by the state and federal government has been done in the shadows, making it virtually impossible for me to fight to defend my reputation, my business, and my associates. But, I can fight an indictment full of absurd and bogus charges and that is exactly what we are gearing up to do. I am looking forward to having my day in court, to having the real facts at hand laid before an objective court, and trusting a judge and a jury of my peers to come to a fair and reasoned conclusion. I am confident that I will be exonerated and that the allegations contained in the indictment will be shown to be patently false.

“Today I ask only that those concerned with this case exercise care in avoiding a rush to judgment and remember that, contrary to the behavior of our government officials on Tuesday (who were literally applauding and congratulating each others as if some conclusions had been reached about me and my business activities), an indictment is not a statement of guilt, and it simply outlines the case for the prosecutor. I am unsure as to why the United States Attorney and other agencies involved have decided to launch a trial of this case, first in the media. However, I am confident that trying the case in court, is a much better way to preserve my rights and to ensure that real justice is served.

“After witnessing the government’s odd, premature celebration on Tuesday, I also feel to remind Mr. Tolman, Mr. Fuhrman, Mr. Brito, Mr. Walz, and Ms. Giani that in our system of government an accused person is presumed innocent until a contrary finding is made by a jury after an opportunity to answer the charges and a full airing of the facts.

“Because this is a pending legal proceeding, it would be inappropriate for me to comment on the specific facts related to the charges or other matters that need to be decided during the future court proceedings. But, I will ask if the government is now taking the position that when any businessman invests millions of dollars into legitimate businesses and industries such as restaurants and movie production, that this is considered a personal expense. Are they suggesting that such sums are considered the same as admission tickets or meal expenses? If so I think several Utah small business owners who work in the restaurant and film industries would like to know that.

“Nevertheless, I will repeat that I deny these allegations and declare, well in advance, that I will be entering a plea of “not guilty” on all counts and vigorously exercising my rights to bring a full defense. I do this first and foremost for myself, and I also do this for my colleagues and fellow entrepreneurs like those individuals standing behind me today, each of which is a local Utah business owner or entrepreneur. I also want to express my personal, deep felt appreciation for the patience, faith, support and strong efforts of virtually all of my colleagues, creditors, and clients. Rumors and false charges can bring a heavy toll on the innocent, and the only remedy I know is to stand up, tell the truth, and have confidence in the good people on both sides of our justice system-whose efforts, when given a chance to make the choice, almost always outweigh the shady and misguided efforts of the few abusive and overzealous government workers.

ANNOUNCING INTENT TO FILE A FEDERAL CIVIL RIGHTS LAWSUIT

“I also want to take this opportunity to announce my intention of filing, as soon as is legally permissible (at the conclusion of this pending criminal case, or earlier if legally possible) , a section 1983 Federal Civil Rights lawsuit naming several government officials and employees including but not limited to Department of Commerce Executive Director Francine Giani, Securities Enforcement Director Michael E. Hines, Susan Jones, Diana Parrish, Jonny Stewart, A. Gary Bowen, Jennifer Korb, and former Securities Division Director Wayne Klein.”

“Because citizens are entitled by right to have their lives, their property and their liberty protected by all government workers, bringing a court action against the individuals named above is an appropriate way to address abuse and corruption. I do not make these charges lightly, for certainly I understand the consequence, and what it means to be openly accused of wrongdoing. Every citizen, whether in business or in government must be willing, when pressed, to be responsible and accountable for their conduct. I am willing to be accountable for mine and I will have my day in court. This civil rights action will hopefully require the government employees named above, to do the same.

RELEASE OF RECORDS AND RECORDING

Early in the week several media outlets began questioning Utah Representative Carl Wimmer and Utah State Attorney General Mark Shurtleff regarding their activities related to me. Some seemed to be suggesting that having an audience with me, by an elected official, was somehow inappropriate. Why a private citizen, asking to meet with his or her elected representative is ever, in any circumstance inappropriate, is a mystery to me. Are elected officials not representatives of each citizen? Should only special interests and lobbyists have access to government officials? If any citizen were to feel that a government bureaucracy was falsely accusing them, taking illegal actions, and doing serious harm to their business and family - wouldn’t any person so situated be interested in contacting his or her elected official to state their case? Or, instead, have we come so far that as citizens we are now willing to give up our constitutional rights to criticize our government and to petition our government for redress?

Yesterday, the local media began reporting on the Utah Attorney Generals refusal to bring an action against me in 2008, citing a lack of evidence. I applaud KSL and reporter John Daley for beginning to uncover the facts related to this topic. When I say “beginning” to uncover the facts it is because there is much more to the story. Today, I have brought with me several selections of transcripts and audio recordings, and I’m releasing to the media (and to the public), essential information related to the rest of the story, both regarding the case the Attorney General decided not to bring and regarding the activities of Department of Commerce Executive Director Francine Giani and her staff.

The reason I’ll be playing a selection of these audio recordings today is that the information contained in them is in some instances so sensational and so outstanding that only hearing the words coming out of the mouths of the government officials making these statements will anyone likely believe what they hear.

Note: Because the most likely defense coming out of the Department will be the contention that these short segments are taken out of context, the full records of the phone calls, meetings, and the full printed documents will also be provided, as soon as possible, at the bottom of this page.

Item #1 - Selected Transcript of Statement from John Brown (Ut. Dept. of Commerce, Division of Real Estate)

In this transcript you will notice a clear violation of the law as described in title 61, Chapter 2, Section 11.5. This was John Brown’s concluding remark to me on my first encounter with the Utah Department of Commerce in 2004. He said,

Mr. Koerber, we haven’t yet identified any illegal or fraudulent activity on your part, but we do not like the way you are doing business and we have serious reservations and concerns. We will keep looking, and for the time being let me put you on notice - We cannot touch you, because you are not one of our licensees, however I will use the full power of this office to come down with both of my feet squarely in the chest of any Utah licensee who does business with you or FranklinSquires.”

This kind of over reaching continued for years. At first, I sought an audience with then Department of Commerce Director Mr. Russell Skousen. When Mr. Skousen resigned from his position I hired him as my attorney to help me work to ensure that my businesses were structured and operating properly and to help communicate with state regulators to ensure that I was given fair treatment and individuals like John Brown did not simply have their way. Mr. Skousen and I have worked together now for years, and unfortunately the behavior by a few individuals in the Department of Commerce has only become worse over time.

Item #2 - Selected audio recording of former Utah Securities Division Director Wayne Klein in discussion with me and two attorneys, in a meeting at the Division of Securities, in the presence of an attorney from the AGs office, and Enforcement Director Michel Hines.

In this recording, Mr. Klein answers an inquiry, after he and Mr. Hines had both revealed that after several years of investigation no evidence had uncovered that I was involved in any wrongdoing. I asked Mr. Klien why he was so insistent that I admit to violations of the law in order to settle the investigation when no evidence or facts discovered in the investigation had yet implicated me. Mr. Klein’s response was telling-

audio icon[Sound Clip #2a]

“We’re in an unusual situation here where we’re trying to find a solution before we get resolved all the factual questions…so we’re all sort of planning without necessarily knowing all the facts, so the next stage is to get the facts and then see whether or not the facts conform to the plan.”

Item #3 - Selected transcripts and audio recording of Utah Securities Division Enforcement Director Michael Hines.

While much controversy seems to exist now given the recent federal indictment, there was never a time when the state investigators told me that any evidence had implicated me in wrongdoing. The opposite was true. For the entire course of the state’s investigation (2004-2007), after learning detail after detail related to my businesses, the lead investigator Michael Hines regularly cleared me of any illegal behavior. The statement below is part of the introductory statement he made the first time we met in February of 2006.

“The Department has been investigating you and your companies over the last two years and as of this time has no evidence to suggest and I personally do not believe that you have been involved in wrong doing.”

Even when troubling evidence started to surface about the business practices of some of Founders Capital’s creditors started to service, Mr. Hines clearly drew the distinction between their activity and mine.

audio icon[Sound clip #3a]

“Rick, you recognize that what I call the bottom feeder LLCs here are going down to visit people to borrow money on their homes, cash out their entire retirements, to put money in that LLC to lend it up line to an LLC that goes up line to an LLC and you’re right, it doesn’t have any association with you.”

Mr. Hines not only regularly told me of his findings, but he would openly tell some inquiring third parties the same thing. Towards the end of 2007, when asked by Jacob Dayton about the rumor that my business was a Ponzi-scheme, or a pyramid/multi-level scheme, Mr. Hines clearly explained that the investigation had not uncovered the facts to substantiate this claim.

audio icon[Sound clip #3b]

DAYTON: So, I’ve also heard that Founders and Franklin are operating an illegal pyramid scheme, something along those lines. Is that true?
HINES: I’ve not heard the word illegal pyramid scheme used.
DAYTON: Well, some people call it ponzi-scheme, is that the same thing?
HINES: Well, there is a difference in a ponzi-scheme and pyramid scheme. A pyramid scheme is nothing more than multi-level marketing where you build downlines. A ponzi-scheme merely means that you are paying old investors promised returns from new investors money. But certainly no one associated with the Division has used either of those terms in reference to this investigation basically because we don’t have the facts to reach any of those conclusions.”

Between 2006 and 2007 I relied heavily on the advice and communication given to me by the Department of Commerce. They had reviewed my business operations thoroughly and regularly discussed with me their opinion and advised me and my attorneys on what they considered acceptable businesses. In October of 2007 I talked to Mr. Hines when he unequivocally told me-

audio icon[Sound clip #3c]

“There is no conduct that has been isolated, to my satisfaction that you violated any laws or rules. There is none. You are not going to be put in jail, there is no warrant and I would tell you if there was. I’d say it. But, Rick there is not…No, you’re not going to be put in jail, I would talk to your attorneys, you and I and your attorneys would have lengthy discussions before charges were ever filed.”

In the same call Mr. Hines suggested we meet and have a cup of tea together and discuss philosophy. His statements related to his opinion of my rumored involvement in ‘wrongdoing’ were regularly repeated to unrelated third parties. In the clip below, Mr. Hines-in talking with Jacob Dayton about my case-once again confirms this same opinion. Note: Mr. Dayton made this recording and provided me a copy.

audio icon[Sound clip #3d]

Dayton: “You know Rick Koerber right?”
Hines: “Sure, yeah, he and I have met several times.”
Dayton: “I’ve heard he’s going to be charged with felony fraud or something, that’s what I’ve heard. Do you know what that’s all about?”
Hines: “Hmmm. No idea. There is an ongoing investigation relative to the collection of money by a lot of LLCs and uh, there have been decisions made on some individuals that it appears will be charged with criminal conduct, but right now Rick Koerber is not one of those. So, I don’t know what that is. There is a tremendous amount of misinformation in the market.”

What we would learn during the course of the investigation is that the most serious “misinformation in the market” the Mr. Hines referenced, often came from the Department of Commerce.

When, the story broke yesterday, that Mr. Shurtleff had declined to bring charges against me at the conclusion of the Department’s investigation, his decision was consistent with most of Mr. Hines statements throughout the investigation.
Some might suggest that Mr. Hines was not being genuine, that perhaps he was attempting to mislead me as part of his investigation. Evidently this is sometimes permissible by police offers or other law enforcement agents. Unfortunately for Mr. Hines and others in the Division of Securities, the Utah legislature explicitly has prohibited any person from using deception in conjunction with enforcing the securities laws, no matter the role they play. The law describes any false statements made in this context as felony violation of the law.

61-1-16 - False statements unlawful

It is unlawful for any person to make or cause to be made, in any document filed with the division or in any proceeding under this chapter, any statement which is, at the time and in the light of the circumstances under which it is made, false or misleading in any material respect.

If both Mr. Hines and Mr. Shurtleff concluded that there was no evidence that justified brining any charges why was Ms. Giani (who is not a lawyer and not family with the law) so persistent? Well, only she knows the full answer, but the following information might help, at least in part, to clarify the rest of the story.

Item #4 - Selected audio recording from Wayne Klein, former Director of the Division of Securities.

The statement below was made by Mr. Klein following my August 31, 2007 radio broadcast where I openly criticized him and his division, calling him a ‘commissar’ (though not by name) and had suggested that the state legislature should reduce the size of government and add some check or balance against the unlimited powers of the Division of Securities.

audio icon[Sound Clip #4a]

“Part of the problem is that I’ve been painted in a corner because you’re client has gone on the radio and publicly accused us of stuff. He’s got legislators out there trying to cut our powers because what we’re doing as if he’s entirely right in what he’s doing and government is unfairly coming after him. So ordinarily we have more flexibility but where I’ve got public attacks coming in saying we’re being accused of being unfair…[interrupted].”

It’s important to note that this is the same conversation where Klein admits he does not have the facts (see Sound Clip #2a) and the same conversation where Hines admits the problems being uncovered don’t “have anything to do with” me.
Mr. Klein was so “peaked” that even after he had been provided with a copy of the Founders Capital Balance Sheet showing that the company had approximately sixty million dollars more in assets than it did in liabilities and after his staff had spent the time necessary to investigate the supporting records-including real estate agreements securing the majority of the balance sheet equity-which review included looking at purchase contracts, appraisals, loan documents, property reports, lease agreements, etc.,-nevertheless, Mr. Klein continued in that same meeting to make even more startling demands.

In this meeting and subsequent related meetings Klein explained that he had reviewed the matter with his superior (Francine Giani) and that in order for me to avoid being charged with criminal violations of the law (though, again, in the same meeting he admitted there was no evidence to warrant it) Mr. Klein demanded that I remove my billboards, that I and my partners sell our “expensive cars” and as part of his written counter proposal (on official Department letterhead) demanded that I agree to a 3rd party administrator of my company who would liquidate the companies assets.

Perhaps most alarmingly, his written offer included that demand that I sign a written affidavit promising not to criticize (in public or in any future court) “any action” the Department took against investors in my business.

“Mr. Koerber will provide an affidavit to the Division affirming…[that he] will not claim publicly or in court that any action the Division takes against investors in Founders…is impeding the companies efforts…”

As Mr. Klein continued to insist on his demands, in meeting after meeting he grew more insistent. In other communications he suggested that if I resisted his demands, he and his department would start communicating that my business was a multi-level ponzi-scheme.

When asked why he would communicate such a claim given that he and his staff had investigated financial statements and related documenting, making such a claim absurd, he informed candidly responded that despite the financials, if he and his Department made the allegation of a ponzi-scheme, it would “stick to me like glue” and that he had contacts in the media who would tell the story. The first media source to publicly allege that my business was a ponzi-scheme was City Weekly reporter Eric Peterson. Evidently, City Weekly was publishing its information with Klein as a source, because an insider later forwarded me a copy of an email sent from Klein to City Weekly (who had since been forced to resign from office) congratulating Eric on the story and asking if, now that the story had been published if “it was acceptable” for him to by Mr. Peterson lunch.

Item #5 - Audio recording of Mr. Hines changing his story and telling third parties that my business was a multi-level scheme.

While Mr. Hines sometimes insisted that “no one in the Division of Securities” would use the terms “ponzi-scheme” or “multi-level scheme” because the evidence did not warrant it, consistent with Mr. Klein’s agenda Hines himself spread this gossip to Jonathan Bond in a telephone conversation.

audio icon[Sound Clip #5a]

“I know what happened in this case, clearly, everybody got carried away with this idiotic multilevel marketing of promissory notes is what occurred…they did violate state and federal law…as long as the money was coming this was a wonderful multi-level marketing program and then the money dried up.”

Item #6 - Audio recording of Corporate Finance employee Gary Bowen carrying out the policy of Klein in a conversation with an unrelated third party.

Hines was not the only one who later engaged in spreading gossip about me and my company after I refused to give in to the terms outlined by Mr. Klein. In November of 2007, Mr. Gary Bowen then in the Corporate Finance section of the Securities Division offered the following to Devon Anderson who had called about an unrelated matter. In an effort to “get the word out” made several startling, false, and criminal accusations.

audio icon[Sound clip #6a]

“If [your friends have] invested in FranklinSquires they’re going to lose their money. FranklinSquires is putting the buzz out that the division is going to lock them up, that’s not so. We’ve seen their balance sheets and they’ve got a shortfall of about $60 million dollars so it’s just a matter of time before that collapses. So if you know anyone that’s invested, bye-bye they’ve lost their money…under securities regulations and rules, this secrecy concept, and that’s part of the FranklinSquires model, is fraud. Its just, it is.”

Of course there is not, and never has been, any secrecy concept related to FranklinSquires. At the time of this statement the financials in possession of the Division showed approximately sixty million in assets that exceeded liabilities. I was so startled by this behavior by a government employee (whose statements directly impacted our ability to do business successfully) that I promptly called Mr. Bowen to challenge him on his statement. The following transcribed selection is from Mr. Bowen’s portion of our telephone conversation.

audio icon[Sound clip #7a]

“Rick, I have not seen your financials. I don’t know that you’re going bankrupt. I don’t know where these people are getting that information… They’re not getting it from me… I’m not in the loop on investigations and so forth…I understand that you are in the process of dealing with either Mike or Wayne but I haven’t seen it…”

CONCLUSION

When the Attorney General’s office declined to bring charges against me in 2007, after the government had thoroughly investigated my business and on multiple occasions advised that there was “nothing illegal” about our business and that I “had not broken any rule or law” despite the gossip and rumors otherwise, I was relieved and thankful that in Utah we have an Attorney General who was more interested in the law than in retaliating against me for my political opinions, my criticisms, or my refusal to agree to a corrupt regulators unjust demands.

I cannot imagine how anyone would suggest that Mr. Wimmer, in joining with other elected representatives, in calling for an audit of the Division of Securities, after learning of the kind of behavior, was doing me a favor. He was doing all Utahns a favor. Mr. Wimmer and his associates were clearly vindicated when the independent audit - which declined to include my case in its review since it was then an ongoing investigation - documented abusive prosecutorial and enforcement tactics by the division, a lack of leadership and policy guidelines for how and when to bring changes, lying and deception in settlement offers with innocent citizens, and several other very serious problems.
I did not invent the results of the audit. I did not influence the results of the audit. I am only astonished that after Wayne Klein resigned (one month after the approval of the audit) the rest of the leadership of the Department (Ms. Giani) and the head of Securities Enforcement (Mr. Hines) where most of the audit’s documented abuses took place)-are both still employed by the State. The results of that audit have to be the most under reported political and public policy event of the last year and a half.

I want to thank not only Mr. Wimmer and Mr. Shurtleff, but the other government officials and representatives who listened to my evidence. Speaker Curtis, Rep. Dougal, Senator Stephens, and several others who all voiced agreement with me that Ms. Giani was known to be unable to effectively manage her department. In our breakfast meeting Mr. Shurtleff told me that given what he had learned about Mr. Klien when he had worked for the AGs office, he was certain that Ms. Giani did not have the qualifications to reign in someone like Mr. Klien who was known even in his past employment as chasing down personal vendettas rather than focusing on the law.

I cannot believe that after Ms. Giani supported these activities, after Klein was forced to resign, after she unequivocally stood by him and publicly predicted that he and his department would be vindicated by the audit (which he most clearly was not) and after she herself was directly implicated in the audit results, and now after she has admitted that she (not being an attorney, nor authorized by the law to do so) went against the advice of the Attorney General, went against the facts uncovered in her case - and after all that she still has her job. Tuesday, was Ms. Giani’s ‘victory day’ as it was called, as she participated in the orchestration of that premature celebration (Tuesday’s press conference). But, because of what happened leading up to it, the indictment announced Tuesday is not just troubling news for me, it represents an ominous precedent for all Utah business owners.

My statements today have not been to offer up any defense on my case whatsoever - I am satisfied to do that in court. I am willing to be accountable for all of my actions. I can only hope that with the release of this information, the governing authorities might take the necessary steps to ensure that Ms. Giani and her colleagues finally have to do the same.

–END

Rick Koerber , CEO of Franklin Squires Goes Live on CBS Television, by Robert Paisola

2009-06-07T23:37:00.003-06:00

Rick Koerber the CEO of Many Utah Based Companies including Franklin Squires, Founders Capital, and other companies.

This is a three part Video Series Recorded Live on Sunday June 7, 2009

Please send all comments to comments@franklinsquireslawsuit.com

Part 1 of 3 Rick Koerber , CEO of Franklin Squires Goes Live on CBS Television, by Robert Paisola

For the full Interview, Please visit KUTV at

http://www.kutv.com/mediacenter/local.aspx?videoId=89564@kutv.dayport.com&navCatId=1841

To our readers around the world.
The above video was aired on CBS and was aired live with Mr. Rick Koerber of Feanklin Squires and Founders Capital. We want you to know that we are receiving your letters and calls regarding this case. We applaud Mr. Koerber and the fair reporting of KUTV on this matter.

We will keep you posted as issues develop.

To your success

Robert Paisola
CEO and Chairman
Western Capital Multimedia Inc.
www.RobertPaisola.com

Rick Koerber Press Conference - 3:00 PM MST -Grand America Hotel, Utah

2009-05-29T12:02:00.001-06:00

PRESS RELEASE

RICK KOERBER RESPONDS TO FEDERAL INDICTMENT, ANNOUNCES A MULTI-PARTY FEDERAL CIVIL RIGHTS LAWSUIT, AND RELEASES TRANSCRIPTS AND RECORDINGS OF STATE OFFICIALS ENGAGING IN CRIMINAL VIOLATIONS OF UTAH LAW AND OF THE STATE’S CHIEF INVESTIGATOR CLEARING HIM OF ANY WRONGDOING

SALT LAKE CITY —The following statement was delivered by FranklinSquires President & CEO Rick Koerber at a press conference held at the Grand America in downtown Salt Lake City, UT at 3:00pm on Friday May 29, 2009—

Hey Rob, this is Rick Koerber, I know it is late, but can we meet? Robert Paisola Reports Live from SLC Utah USA

2009-05-28T03:21:00.005-06:00

LISTEN TO THE FULL AND UNEDITED PRESS CONFERENCE ANNOUNCING THE INDICTMENT OF RICK KOERBER of FRANKLIN SQUIRES and FOUNDERS CAPITAL WITHOUT ANY TYPE OF EDITING. THE CONFERENCE STARTS AT 2 MINUTES INTO THE RECORDING

Watch the Video That Rick Koerber wanted me to see that put everything that is happening into perspective. I simply stared in awe as I saw this!

In the years that I have been involved in the world of journalism, I have seen so many stories come and go. Most have a very short life in the memory of the Average American and sometimes, just sometimes, there is a story that not only captures the minds of the people in the State you live in, but the International Press.

Tonight at 11:22 PM, I received a call from Rick Koerber,the CEO and Chairman of Franklin Squires, Founders Capital and many other companies, who, as we reported on this site, has been indicted by a Grand Jury in Utah.

He wanted to meet TONIGHT!

Many people outside of the State of Utah do not know where to look for data on this case, so we are going to now post the official US Attorney Press Release that was submitted to the media yesterday, when the indictment was announced, as we have reported. Again, this is the press release that was issued to Western Capital Multimedia, as well as all other news outlets. Do not get bored, because there is much to follow!

For Immediate Release
May 26, 2009 United States Attorney's Office
District of Utah
Contact: (801) 524-5682

Indictment Charges Koerber with Mail, Wire Fraud and Tax Evasion in Connection with Real Estate Investment Scheme
Investment Scheme Took in About $100 Million in Investor Funds; More than $50 Million Used to Make Ponzi Payments While Other Investor Money Was Diverted to Other Uses

SALT LAKE CITY—A federal grand jury returned a three-count indictment Tuesday morning charging Claud R. Koerber aka Rick Koerber, age 36, of Alpine, with mail fraud, wire fraud, and tax evasion in connection with an alleged fraudulent investment scheme he devised to get money from investors. Koerber was involved with several businesses in Utah, including Founders Capital, Franklin Squires Investments, and Franklin Squires Companies, during the course of the scheme which the indictment alleges operated from sometime in 2004 to about Dec. 31, 2008.

The indictment alleges that in 2004, Koerber created and presented a series of seminars designed to encourage individuals to make money through a real estate program that he named the “Equity Mill.” The indictment alleges Koerber accepted money from individuals and companies through Founders Capital by means of representations that Founders Capital would use the money to make “hard money” or bridge loans to other entities associated with Founders Capital.

The indictment alleges Koerber used seminars, phone calls, mailings, radio programs, web sites and advertisements to communicate with investors and potential investors.

According to the indictment, Koerber represented to investors and potential investors that substantial amounts of money could be made through the “Equity Mill.” Koerber, according to the indictment, paid varying amounts of interest on the money provided to Founders Capital, but generally paid 5 percent per month to its first line investors.

Koerber, as a part of his seminars, encouraged first line investors “to act and think like a bank,” according to the indictment, by obtaining money from other people to place with Founders Capital. It was suggested that first line investors could pay 3 percent per month to second line investors, and in turn, second line investors, also thought to think and act like a bank, could pay 1 percent per month to third line investors.

Koerber represented to investors that Founders Capital provided an opportunity for families to loan their funds directly to Founders Capital in exchange for an aggressive interest payment and a high degree of liquidity. Founders Capital would then re-loan the money to parties that met Founders Capital’s lending criteria, Koerber said. The indictment alleges Koerber represented to investors and potential investors that the funds loaned to Founders Capital were secured by real property of greater or substantially similar value. The indictment alleges the money invested through the program would be used as “short term” financing to acquire and improve real property investments prior to obtaining more permanent cost effective financing.

The indictment alleges that Koerber told investors that when individuals or families make loans to Founders Capital, typical interest rates on the loaned funds would range between 1 and 10 percent a month, and that typical levels or security or collateralization ranged between 50 and 150 percent.

In fact, the indictment alleges, Koerber knew that those representations were false, or that Koerber made them false by using some of the money for purposes other than real estate bridge loans and to purchase real property. Furthermore, the indictment alleges, most of the money placed with Founders Capital was not secured or collateralized by real estate, and was diverted by Koerber for other purposes.

The indictment alleges Koerber used investor funds for personal housing, expensive automobiles, investments into restaurants, and investments into other businesses. For example, Koerber spent $850,000 on restaurants, loaned $800,000 to an associate for a restaurant, and spent more than $1 million on expensive automobiles. In addition, the indictment alleges, Koerber spent more than $5 million on making movies.

Koerber operated Founders Capital and other related entities as a ponzi scheme to convince earlier investors that their funds were earning money and to convince potential investors that the program was working and earning money. The ponzi payments created the false impression that the businesses were profitable, investments were safe, and interest was being paid.

At no time during the operation of the scheme, according to the indictment, did the Founders Capital or Franklin Squires entities operated by Koerber as a part of his Equity Mill scheme make a profit. Koeber obtained approximately $100 million in investor funds and over $50 million of those investor funds were used to make ponzi payments.

The number of victims involved in the alleged fraud scheme has not been determined, although it could be in the hundreds. Determining the number of victims is difficult because of the different tiers of investors involved. Authorities believe most victims live in Utah.

Count one of the indictment, mail fraud, charges Koerber with using the mail to send a letter addressed “To Our Lenders” which contained many of the false and fraudulent representations of the scheme. The potential penalty for one count of mail fraud is up to 20 years in federal prison and a fine of $250,000.

Count two of the indictment charges Koerber with transferring $1 million of investor money to a Founders Capital account. The potential penalty for wire fraud is up to 20 years in federal prison and a fine of $250,000.

Count three of the indictment, tax evasion, alleges Koerber had a taxable income of $900,000 for 2005 and owed federal tax in excess of $250,000 but failed to file an income tax return for the year. The indictment alleges Koerber caused various business entities under his control to pay personal expenses on his behalf. The potential maximum penalty for the tax count is up to five years and a fine of $250,000.

Defendants charged in indictments are presumed innocent unless or until proven guilty in court.
A summons will be issued to Koerber to appear for an initial appearance in federal court. The investigation, which is being conducted by the FBI, the IRS, and the Utah Department of Securities is continuing.

--- END OF PRESS RELEASE---

Now, back to tonight's call, Rick requested that we meet tonight starting at 11:00 PM, to "meet and have a discussion" This was great news to me, because Rick knows that I have been dealing with the Worldwide Media because of his case for the past two days non stop.

I jumped in my car, and headed over to Rick Koerber's home, and entered into what he referred to as the "Capitalist Bunker" . Rick had literally recreated the White House in his basement, complete with paintings, art, statues, leather couches and what I can only explain as a NASA looking computer system.

I was impressed.

"Rob, I want to personally thank you for all that you have done. I replied, that there was no reason to thank me, because all that I was doing was taking his case to the American and International Arena. And I TRULY BELIEVED IN THE Free Capitalist Cause, just like all of the dignitaries that we will be posting now and in the future.

"You know, a lot of reporters have called me since the announcement and almost every single one of them ask me the same question, "What did you say to Robert Paisola to make him change sides and to become so vocal about his support for you" they would ask, and he would simply say, "Why dont you call Robert Paisola and ask him yourself"

Well the answer is simple, he did nothing. We have talked for the past year and I documented and reviewed data for hundreds of hours. We (Myself and My Colleagues) came to the conclusion that the entire basis for the rumors of wrongdoing by Rick Koerber, could not be true, even from a mathematical standpoint, let alone the timeline, it just did not add up. We even had outside forensic accountants look at the raw data and former IRS officials review the details and they said the same thing! So, what in the hell was he being indicted for anyway?

We can not go into the exact details of the conversation, but I can tell you that the information that I was presented and given blew me away. Now I knew that I was on the right track. Thank god I decided to meet at this late hour with Rick Koerber.

"Rob, your coverage of this has caused this to become a worldwide matter" and I have been receiving calls from all over the world because of what you are saying. Nobody seems to want to believe that you and I see eye to eye, and People are asking me more about your coverage of this, than the case"

"I Smiled"

I know that Rick Koerber has some serious heavyweight champions on his legal team. And I also know that they have nothing to do with the political machine in Utah. For these are all former Federal Prosecutors, who now represent Mr. Koerber. I also saw the documents and listen to the inquiries of the many Utah Attorneys who now want to jump on the bandwagon because they now see that this is an International Case.

But the fact remains that we have spent over two years investigating this case, and our conclusion is very simple. The facts do not add up.

I pointed out that I was reading his website and that he was not saying anything at all about the case. He concurred and stated that he could not talk about the case and what he did say was confidential. But nothing was said. I also pointed out that I believe that the media coverage that has happened so far was somewhat fair, but I was absolutely positive that KUTV in Utah and Bryan, its anchor, were people that I trusted. He concurred and we discussed the fact that we previously had both agreed that it would be ok for Rick to meet with Fields Moseley of KUTV, as I had a strong belief in the fairness of the reporting of ABC and KUTV and I had personally met with the News Director on another matter last month.

So yesterday, Rick Koerber met with Fields Moseley and did a story for ABC News.

Here is the story:

"But Rick, why did you want to meet tonight? Because I want to hear the full unedited copy of the press conference that you recorded. "No problem, I will be right over"

We loaded the audio from the press conference that is now live at the top of this page. Rick listened in absolute disbelief. He said he had a video that he wanted me to see; a video that put this whole Federal Indictment into perspective. We watched the video ( Listed above) and I sat in awe, thinking, is this what our country has come to?

We met for three hours and agreed to meet tomorrow for another exclusive interview.

He discussed many issues and provided much insight into the past 48 hours into his life, but he was confident, upbeat, absolutely centered and clear on his mission to the American Public. I was sad that I could not say more, but hey, I can say whatever I want, I do not have to report to a board of directors. I own the company! That is why I created Western Capital Multimedia to begin with! If you have not seen the site, it is great, and we are very pleased. It is at www.WCMTalent.com

It is a passion and I love the media business, so why not own a piece of the pie! 3 magazines and a movie, and a TV Show in syndication is a great start. But this type of International Reporting makes every dime spent on studios, lighting, HD Cameras, and infrastructure worth it all. We have access like never before, all around the world. And that is what will make this case against Rick Koerber be seen around the world.

It was one meeting that I am glad that I chose to attend, regardless of the time of day.

I can PROMISE you that there is MUCH MUCH more to come. We will carefully be releasing data, recordings, writings, political statements, videos and much more, as the Attorneys allow this to go public. If you are a member of the press, a victim or someone who is watching this case, Watch us on Twitter and Facebook, because we do not have office hours and we will do WHATEVER IT TAKES TO GET YOU THE STORY! Even at 5:23 AM in the morning.

To Your Success

Robert Paisola
CEO and President
The Western Capital Group of Companies
The Robert Paisola Innocence Project
www.RobertPaisola.com
www.FranklinSquiresLawsuit.com

TWITTER
FACEBOOK

Robert Paisola Responds: The Franklin Squires and Rick Koerber Indictment

2009-05-27T16:57:00.003-06:00

To our friends around the world:

Thank you for taking the time to read this blog and to present your feedback on what you read and have read now and in the past.

It is essential that we are very clear that we are not privy to any special information that has not been presented to the public. We are simply using this forum as a place to keep you, the American Public, informed.

One of the biggest obstacles that we are coming across is the fact that so many people are contacting our office who are being viewed as victims of the Franklin Squires Machine.

You need to understand that because there was an official indictment filed against Rick Koerber yesterday in Federal Court, there is absolutely no way for Western Capital to assist you with any claims you may or may not have against the company, Mr. Koerber or any of his associated.

There are many people that have this belief that we have a magic wand that we can waive to solve their personal problems. As of this point, that is not possible.

Yesterday, the US Attorney for the State of Utah, advised us that the investigation was considered "Ongoing" and that anyone that had additional information should contact their office.

This is what we would ask you to do.

We will continue to bring you live coverage of not only events surrounding the case, but our personal feelings as well, just as you witnessed yesterday in our article that discussed our personal feelings on Mr. Koerber.

Again, these should in no way be considered facts, as because we are not trial counsel, we can not begin to predict what will happen in the future.

One good thing is that Rick Koerber now has the ability to defend himself against comments and charges that have been alleged against him and his companies over the past few years. One of the negative sides, is that one of the most important concerns that Attorneys have when they deal with a very high profile case like this is HOW THEY WILL TRY THE CASE. The strategy that will be used is something that not only the American Public, but the national media, must present to Counsel for the Defendant.

The bottom line is that there are many questions regarding this case that remain unanswered. It is highly probable that many of your questions will remain unanswered until the Government or Trial Counsel determines the proper time and place to discuss those matters.

One thing that we can tell you is that there are many people who have contacted us and have gone into great detail about their losses. Many people believe that just because they have never been contacted, that they will not be considered victims of this issue.

We DO NOT have access to the courts. We can not predict the future, and because of ethical issues, it is impossible for us to assist you in any way "to get your money back"

As many of you know, we have been bombarded by media from around the world. Because of the extreme demand from the media and the world time zone issues, as well as because of our history with this case, we are only working with national media. That is not to say that we can not work local media into our schedule, it is just a simple process of reaching the most amount of people possible. That is why we choose to appear on NPR National vs. a local NPR Affiliate. That is why you will see us on the BBC National Channels as opposed to the daily newspapers in Europe.

Again, please call 801-619-4700 and be specific on your needs. Let us know what you want and when your deadline is. We do not want to be on National Television in Africa at 3:00 AM, but if that is what works, please let us know.

Finally if there are questions that can not be answered, please understand that we will simply tell you that we can not discuss that matter.

I wish the National Media, the Victims, the Prosecution Team and the Defense Team nothing but the best. But please understand that we are NOT going live on CNN to debate this matter with the United States Attorney. That is not only wrong, but extremely improper.

Likewise, we can not show up at a victims home with cameras rolling and have the victims of this indictment throw questions at us without notice. The issue is that there are many people who have lost a lot. We are extremely sensative about the HUMAN NATURE of this story. Our commentary yesterday should be merely viewed as a personal analysis of how we view Mr. Koerber. We are not the judge, We are not the jury, and we can not deliver any information other than what we post here, on Facebook and on Twitter.

We appreciate your interest, but we ask you to please understand our position.

To your success,

Robert Paisola
CEO and President
The Western Capital Group of Companies
www.RobertPaisola
www.Twitter.com/RobertPaisola
www.Facebook.com/WesternCapital

The Rick Koerber Indictment, Here we go, by Robert Paisola

2009-05-26T22:27:00.010-06:00

May 26,2009
For Immediate Distribution Western Capital Multimedia by Robert Paisola

To all of our readers around the world. We want to take a moment and acknowledge the thousands of calls and emails that you have made to our offices regarding the indictment of Mr. Rick Koerber of Franklin Squires that occurred this afternoon.

I want you to know that a fellow media associate advised me three days ago that this was going to happen. We did not know when the indictment would be issued, or when the Grand Jury would meet in Utah, we just knew it was eminent.

Today at 2:30 PM MST, there was an official press conference at the Office of The US Attorney for the District of Utah. We were there. Standing along side the dapper US Attorney , were members of various governmental agencies that had been investigating The Rick Koerber and Franklin Squires matter for as long as we have.

During the past year, we have come to know Rick Koerber.

We have had the opportunity to spend hours with him and to meet his family. We have had the opportunity to place a face with a name that seemed so far away, staring from a billboard.

We have also come to know Rick Koerber as a businessman who gained much success at an early age, but trusted too much. We have seen and heard the stories of his ups and downs. We have personally seen people assemble at his feet as he spoke.

We have seen and have gotten to know the many political, governmental, business and people like you and I, who he calls his friends that Mr. Koerber keeps close to him.

We have seen the fierce loyalty of members of his staff, who protect him vigilantly.

We have seen the person. We have seen the pain, We have seen the agony. We have seen the betrayal of many people who clearly documented their support for this man, only to turn their backs in times of strife.

We have seen and interviewed many of the Victims of the Alleged Scheme. We have witnessed the abuse that they received as the words of the teacher were bastardized for personal gain by his students and past partners. We have seen the pain that they now face, as they are loosing their homes and their financial stability, as a result of many (to be named) unscrupulous people. We have seen the political arena shift.

We as an organization have shifted. I Robert Paisola as your moderator, editor, confidant and CEO have shifted.

One thing that we can and will say is that Mr. Rick Koerber is a 34 year old man who is a father, a motivator, and an inspiration to many. His radio show is played throughout the world, and he receives comments daily from those whose lives he has touched from around the world.

We also know that we have extreme power in this matter as a liaison to you, the American Public, a mission that we take very seriously.

Why the change?

Imagine if you will, driving down a large highway, perhaps it is i-15 in Utah, and looking to the right and then to the left, and seeing the face of a man who appears to be confident, secure and privileged.

Remember back to when you saw those billboards... What did you think?

Honestly, I saw a man who had the courage to take a stand and to attempt to change the lives of many for the better. I was jealous that I did not have the ability to take such a stand to better peoples lives. But at that moment, I committed to do just that, to create change in the world, no matter what the cost.

And I wondered, Could your life really be changed by having a 740 FICO Score?

After two years of investigation into this man, and after spending thousands of dollars in a cat and mouse game that Rick and I only laugh at, many times I have often criticized Rick Koerber in the public arena, because I was simply repeating what I was being told by many of the victims of this massacre , which I have often openly criticized.

But not one time did I make the decision to "Go to the source" and to simply call Rick Koerber and offer to sit down and talk. My ego was much too big for that to happen.

Then one day last year, I made the decision to simply pick up the phone and call this icon named Claude Rick Koerber. Guess what! He answered the phone.

Awkward as it was at first, like the BYU v Utah Rivalry, we began to see that there were many similarities between us. He was a mental giant; a true intellectual genius and could quote from many archaic government speeches that I had only glanced at in college, AND he became REAL.... VERY REAL.

He was now not just a person that we had been receiving email about for 2 years (both good and bad) , but he was now a REAL PERSON.

A Week after this two hour initial phone call, we met in person, and from that time forward, we have been keeping in touch.

I can tell you that he is a very open person just like I am , and I attribute the experiences of my past to the person that I am today.

It was a magical moment to meet the leather jacketed, non shaven, "Regular Guy" who looked or acted nothing like the guy in the videos or on the billboards. Simply "one of the guys"

After a 7 hour meeting with Rick Koerber at a local restaurant, I learned very quickly that I could trust this man. I have a keen sense of awareness and have been trained in many areas of psychological awareness, including body language awareness.

But, as I watched diligently as he drew out the maps and graphs of the structure of his organizations. I watched a man who trusted..... perhaps too much, the people around him, and I saw a person who was becoming familiar and open. This was not the man that we had been reporting about.

This is when I met THE REAL Rick Koerber.

At the end of the end of the evening, he played me some tapes that he had archived, telling me that he had absolutely no intention to share these tapes with me, and I still keep the words guarded to this day, as these are words from a Senior Government Official who will plow the way for Rick Koerber to be exonerated.

I often wonder what the American Public and A Utah Jury of his peers will say as they hear the words that I heard from that absolute prophetic governmental official.

I was convinced.

At that moment, I knew that this was a man who was someone who simply trusted way too many people.

This was a man who had no idea of the power that he possessed.

This is a man who people look up to even in times like this.

My friends, now is the time to do what you think is right. Now is the time for you to take a stand and show America that you are accountable for the actions in your life, just as Rick Koerber has done without fail.

Now is not the time to back down, because what I saw today in the United States Attorney's office with my own eyes is something that words can not describe.

I saw big brother stand before America and say "I Dare You" I also saw Jason Chaffetz and President Obama say Hold on guys, lets take a closer look at this. I saw Senator Hatch and Governor Jon Huntsman say... enough is enough. It was not said, but I could see it in my mind. This is NOT the America that the founders had envisioned, and I could see Rick Koerber sitting on the Witness Stand, demanding to be heard, as the jury of his peers wept.

What I do know about Rick Koerber is that he is a person tat I can call 24 hours a day and get advice from. I am here for him, and he is here for me. We have been in the room with many dignitaries from around the world who I can only imagine what they will do as they read this. But I can tell you that they will not falter.

Rick Koerber is a person who I compliment in public settings.

Can you believe that we stood on the same stage together, in UNITY, as he made a pledge to hold those people accountable for their actions as they wantonly violated the rights and used his teachings that he provided take advantage of innocent people. I saw the passion in his eyes. I saw the dignitaries align with him, and I saw his future jury nod in complete agreement. That was a sight that I will never forget.

What I will tell you is this. Rick Koerber is someone that has a plethora of data that we have been given carte blanche access to. He is someone who keeps meticulous records. He is someone who records calls (Hundreds of Hours) and he is someone that is surrounded by a magic bubble of supporters who will not fray.

I have seen these people and these people are the exact people that will be on the jury that hears this story, who watches the videos, who hears the tapes, who will relate to this 34 year old man and see clearly what he has been through in the past few years. These are the same people who will take a stand for justice in America,

Many people have said, yes Rob, but the government wins 97 percent of the cases which they file. That may be true, however I can guarantee you that you are about to witness a defense team that BECAUSE OF YOU, is going to go the distance. There is no middle ground in this fight. There is no backing down.

"Rob, I would rather sit in jail the rest of my life knowing that I have done the right thing that to stand in fear and become another statistic" Just think if every single accused person took this position. There would certainly be many less people in Federal Prison right now.

This is not a trial about Rick Koerber, Founders Capital and a bunch of Real Estate Deals, this is about YOU and our government. This is about you and YOUR future. This is about audio tapes that will make you sit back and say.... there is no way.

And that is straight from someone who has spent almost 1000 hours reviewing the data and the deals.

Mr. Koerber, fear not, as you are surrounded by thousands of people who believe in you, and they not only believe in you in words, they believe in you from their hearts and their pocketbooks.

The surprise and disbelief that was expressed by the prosecution as your prized attorneys confirmed their representation of you in this case said more than words can tell.

There is so much more to say, however at this time, I am unable to be more detailed. But watch carefully at how this plays out. Look at the expert witnesses. Look at the pedigrees of the Attorneys and Investigators that will be working on this case, and look at many of the ALLEGED VICTIMS, as they freely open their wallets to cast their vote for Freedom in America.

If you are in a similar situation, contact our offices now at vip@mycollector.com. Take time to read this and post your comments. Take time to offer your services, your time and your money. Any and all money received will go directly to the large amount of money that it takes to fight a battle like this.

Oh, who am I? Take a look at a couple of websites:

www.WesternCapital-TheTruth.com
and
www.RobertPaisola.com

and if you really want to see how we work, simply watch the hundreds of videos that exist where we are going to battle with the Big Guys for YOU.

And if you are the kind of person who loves to read gossip and dirt, and you have some insane desire to read all of the fun stuff from the past, check out our foundation at www.PrisonPartners.com . On this site, nothing is held back, and trust me, we know where we are, we know where we have come from, we know where we stand, we follow the law, and accept accountability when wrong, and we certainly know what we are doing and how to navigate the political system in America.

All media inquiries should be directed to media@westerncapitalnews.com or www.WesternCapitalNews.com

To your success Mr. Koerber,

Robert Paisola
CEO and FOUNDER
The Robert Paisola Innocence Project
www.RobertPaisolaInnocenceProject.com
www.RobertPaisola.com

John Grisham Speaks by Robert Paisola

2009-05-25T00:09:00.003-06:00

You Could be Next,,,,, The Innocence Project

2009-05-25T00:04:00.001-06:00

Rick Koerber Indicted? Schmucks, Grand Juries, & the Trials Ahead. by Rick Koerber

2009-05-24T00:34:00.000-06:00

As our modern culture hurls itself imperviously over the rocky cliffs of socialism in the name of rescue and bailout, normal people seem to be losing their ability to think critically and distinguish decency, fairness, civility, and honesty from rumor, rhetoric, political posturing and gossip. Its a cultural battle being waged every day in the business world, and I don’t mean just big business, I mean small business America too. The competition is decency vs. defamation. Do-gooders, versus society’s most valuable doers. In my world, the constant reminder of this battle is the fact that hardly a week goes by without someone asking me if I’m going to be indicted.

A chilling result of the crisis will be furthering the deadly process of criminalizing business failures. In the old days when an enterprise failed, the proprietors often ended up in debtors’ prison…But in recent years, particularly after the Enron/WorldCom corporate scandals, federal and local prosecutors began actively pursuing evidence of fraud whenever a big business went bust. Yes, there has been corporate wrongdoing, and miscreants have been tried and jailed. But many noncriminal individuals have been pursued.

One notorious case was the IRS’ attempt to prosecute KPMG and a number of its partners and employees for alleged tax fraud. The shelters KPMG sold in the 1990s were not illegal. The IRS still determined, however, that they weren’t valid. That kind of tax dispute would normally be settled in civil court. Instead, prosecutors threatened KPMG with annihilation: Settle on our terms or we will hit you with an enterprise-killing indictment. Arthur Andersen had recently been destroyed by such an indictment, even though the courts subsequently threw the charges out. The feds even pressured KPMG not to pay the legal bills of the targeted individuals–which would have forced these people to settle, as they couldn’t afford the massive legal costs of defending themselves. Thankfully, a courageous federal judge stopped this abuse.

But the itch to indict remains. No sooner had Bear Stearns, Lehman Brothers and AIG gone bust than criminal investigators swarmed in. They will find evidence of “fraud”–why didn’t you more aggressively mark down the value of suspect paper even if there wasn’t a market for it? Why the expressions of confidence in the soundness of your businesses when the rumors of trouble were surfacing? Lost in all this will be the fact that Lehman and AIG didn’t know they were in mortal peril until almost the very end. There will be indictments. The chilling lesson: Unsuccessful risk taking or failing in business can send you to prison. (Steve Forbes, “How Capitalism Will Save Us” Forbes Magazine, Nov. 10, 2008) Emphasis added.

It’s a dumb question really. It’s not like the government, even with the most corrupt bureaucracies, normally calls up the subject of its investigation on the telephone to say, “Hey, just for your information, we’re planning to indict you.” But, the brain-off among us don’t have to be bothered with thinking—they’re too busy indulging in feeling.

In January of this year a local news reporter came to my house and asked me point blank, “But, is it fair to say you expect to be charged?”
Rick Koerber. Some people want to see me behind bars.

Rick Koerber. Some people want to see me behind bars. This is the closest I've come so far. Which I'm hoping annoys the socialists, and my old friend Abel Keogh, daily!

The reporter, Brian Mullahy, and I had been having a conversation about the fact that there have been rumors about me being in trouble with the law, despite no charges, nor formal complaints and no formal allegations of wrong-doing, over the course of the last five years. In that context, I had complained that the very existence of these persistent rumors—even the ones with no credibility whatsoever—had actually given bureaucrats the ammunition they needed to continue their years long investigation of me and my companies without any reasonable basis.

In answer to an earlier question I explained that I, in fact, had not been indicted or charged either on the state or the federal level and that I did not know what was being planned by prosecutors.This was the context for his question “But, is it fair to say you expect to be indicted?” I thought about his question and reluctantly answered, “Sure, sure.”

I went on to say in our interview that given the modern business climate in America any businessman in a situation like mine—regardless of his innocence—would be foolish not to prepare as if an indictment were coming. Of course, all this context was dropped when the evening newscast aired with the headline, “Utah Businessman Facing Federal Charges.” This, of course, is a lie. I was not then, nor have I ever in my life, been facing federal charges.

It used to be a criminal offense to slander someone like this, but now we live in a world where it’s considered by many to be journalism—while at the same time businessmen are routinely accused of criminal behavior by vague allegation, outright defamation, and little attention given to facts or statutes and usually without the businessman having done anything that can be demonstrated to be clearly against the law. This situation, which is the fruit of socialistic ideas in government, has been a growing reality in America for the last full generation and is now a defining legacy.

As a result, it is practically impossible for a lawyer to determine what business conduct will be pronounced lawful or unlawful by the courts. This state of affairs is equally embarrassing to businessmen endeavoring to obey the law and to Government officials attempting to enforce it.” (Robert H. Jackson. Assistant Attorney General of the United States. Later Supreme Court Justice of the United States. Anti-Trust Legislation Seen Necessary, New Jersey Law Journal, February 3, 1938, 6 N.J.L.J. 37 (1938) c. 1938 ALM Properties, Inc.)

So, our modern itch to indict, as referenced by Steve Forbes, continues to have affect in my life, and the same questions come week after week. The rumors this past week were stirred up by none other than prominent Salt Lake attorney Rodney G. Snow. He should know better, but we’ll talk more about that in a minute.

Indictment, indictment, in·dite·ment! Sometimes the questions come from those secretly hoping the rumors are true and that soon I’ll end up behind bars (for just what exactly, they can never quite articulate). Sometimes the questions come from brain-off, but kind hearted friends who just want to express their sympathy (again, for what, they can’t quite articulate.) It all makes me want to throw up, to tell you the truth.

I’ve reached a point in my life where I just can’t stand the slobbery thickness of brain-off emotionalism. I care nothing for the predicaments of those whose own emotional insecurity has brought them to the point of thinking that I’m somehow a villain in their life story when at the same time they don’t have the courtesy, civility, or kind feelings sufficient to talk to me and either get the facts to clear up their misconceptions or, on the rare occasion that there is actually something amiss between us, give me the chance to take responsibility for whatever wrongs or mistakes may, in fact, be mine.

Even worse, I’ve grown sick of the ever growing popularity of the notion that in the present era of bail-outs, bank failures, unemployment and rampant foreclosures, a consumer being stupid (or at least imprudent) and loosing a lot of money somehow qualifies him or her to randomly assign blame and self-righteously demand guilt from whatever businessman seems to fits the bill at the moment—facts be damned. These people are schmucks, and those who are moved by their groveling selfishness enable the sad state of affairs, so often talked about these days. They are complicit in our societies unyielding march towards disaster.

Do I have empathy for those whose financial situation is bleak? Of course. I’ve dedicated my life reaching out to and teaching these very people. However, that is part of the problem. Whenever you dive into deep water, in an effort to save a drowning person, you become at risk yourself. I can’t otherwise explain how so many people whom I’ve never done business with can be so maliciously engaged in the spreading the negative rumors and gossip—almost wholly started years ago by unprincipled, privately motivated, reckless and vindictive government employees.

I once read a post on the Internet that stated, “I would love to talk to someone about the $140,000 that Rick Koerber has of mine that [he] ‘can’t pay’ me back. Thanks. Ryan in St. George.” Evidently I don’t qualify as the kind of “someone” this person wants to talk with, because I have never been contacted by him. Not only do I not recognize his name or situation, the sad reality is that I don’t know anyone in St. George, Utah named Ryan who has ever given me anywhere close to that kind of money. I certainly do not have, nor do any of my companies have, to the best of my knowledge, any unpaid debts in any amount to someone named Ryan in St. George.

Such a small thing like this illustrates a major problem in our world today, particularly with federal grand juries. I have known, for example, that as early as March 2008 there have been witnesses being called by the US Attorney in Salt Lake City, to testify before a federal grand jury regarding my supposed business dealings. But in a federal grand jury proceeding I don’t have the right to confront any witnesses. The rules of evidence are not the same, and there is no cross examination or rebuttal. So, this guy named Ryan could be called before the grand jury, asked to testify about his $140,000, and this could be used as undisputed grounds to issue an indictment. The problem is compounded by grand jury secrecy.

The fifth amendment to the US Constitution is the legal cornerstone for federal grand juries, and the original purpose of a grand jury, including the secrecy of its proceedings, was originally to protect citizens from government abuses. During the era of the Founders (most would be surprised to learn) there were no government attorneys. But, today the US Attorney oversees cases before the grand jury and he (or a member of his staff) is essentially given de facto control over access to the grand jury by the public, and the secret proceedings they carry out. Once a fair minded person begins to think through the implications of this modern court setting, serious issues regarding justice and fairness begin to emerge.

What is true about the danger of “enterprise-killing” charges today, was also true in the days following America’s revolution. The Founders sought to protect citizens from overzealous government by ensuring federal felony charges could not be brought whimsically or too easily, thus the requirement of a grand jury. Secrecy, during grand jury proceedings was a long standing English tradition dating back to the Magna Charta. A critical defense of free society rests upon the notion that the very allegation of wrongdoing, made by the government, can be punitive in-and-of itself, and the process must therefore be strictly guarded.

So, the grand jury is generally supposed to be private/secret. The idea is that before charging a free citizen with a crime, a person who is presumed innocent until proven guilty, give a jury of his or her peers the opportunity to consider the case first, without exposing his reputation to ruin by the process. Of course, there are other reasons for secrecy but the rights of individual citizens are at the foundation of the issue.

The problem today is that, with permanent government prosecutors essentially in charge of the grand jury proceedings, what was once a protection for citizens now, too often, is only an advantage to the prosecutor. Today, there is very little check against malicious prosecution or prosecutorial misconduct when all the proceedings are conducted in secret. Take for example the political motivation to tip the party balance in the United States Senate which utilized prosecutorial corruption in the recent case of former Alaska Senator Ted Steven’s whose case was just thrown out—after he suffered great harm to his reputation and after he lost his Senate seat, all because of the situation I’m describing. It is therefore, not surprising, that according to experts in the field, in 95% of the cases, prosecutors simply get an indictment, whenever one is wanted.

This means that a businessman has no way of knowing in advance whether the action he takes is legal or illegal, whether he is guilty or innocent. It means that a businessman has to live under the threat of a sudden, unpredictable disaster, taking the risk of losing everything he owns or being sentenced to jail, with his career, his reputation, his property, his fortune, the achievement of his whole lifetime left at the mercy of any ambitious young bureaucrat who, for any reason, public or private, may choose to start proceedings against him…It is a form of persecution practiced only in dictatorships and forbidden in every civilized code of law. It is specifically forbidden by the United States Constitution. It is not supposed to exist in the United States and it is not applied to anyone-except to businessmen. (Ayn Rand. Capitalism: The Unknown Ideal, pg. 50 - from a speech given at the Ford Hall Forum, Boston, on Dec. 17, 1961)

In my case, after a failed attempt by rogue state regulators that felt just as Ms. Rand describes, I’ve now learned more about what the federal government is up to, and what is happening before the grand jury, through rumor and gossip—than is supposed to be publicly available at all.

What good does it do to say to me, “We’re protecting your reputation Rick, by ensuring everything is done in secrecy,” when attorneys, government employees, and even members of the prosecutor’s staff are reportedly giving information about secret grand jury proceedings to their colleagues like Mr. Snow, who seem driven to spread the word around.

Lest you think its just any old attorney involved in such behavior, Mr. Snow’s resume shows just how connected he is, having worked as an Assistant US Attorney for this very same office earlier in his career. Mr. Snow, by his privileged position, evidently not only receives special illegal exemption from the legal requirements of secrecy, but he gets to use them to further his law practice at my expense.

There is a strange, almost unnoticed drum beating in our popular culture, where economic hard times (which are the persistent handmaiden of socialism and its relatives) bring average Americans to believe that society’s producers are now somehow the villains. Even worse, our bureaucrats, government employees, and government officials are supposed to become our heroes. In the Founder’s generation we elected heroes to office, to keep abusive government in check. Today we try to make heroes out of those who like to cast aspersions without consequence, spend money without accountability and who send out bureaucrats and government agents with guns, threats, and the delegated force of the people—to satisfy our itch to indict and to punish society’s white collar villains—who, in rapidly growing percentages, are increasingly men and women whose crimes can’t be described or articulated and whose actual performances and intentions are almost entirely irrelevant. Lost is the idea that businessmen, entrepreneurs, and even corporate executives (regardless of their supposed crime) are still citizens, in a free country, presumed innocent until proven guilty—also born like the rest of us, with unalienable individual rights.

Only businessmen - the producers, the providers, the supporters, the Atlases who carry our whole economy on their shoulders-are regarded as guilty by nature and are required to prove their innocence without any definable criteria of innocence or proof, and are left at the mercy of the whim, the favor, or the malice of any publicity-seeking politician, any scheming statist, any envious mediocrity who might chance to work his way into a bureaucratic job and who feels a yen to do some [governing]. (Ayn Rand. Capitalism: The Unknown Ideal, pg. 44 - from a speech given at the Ford Hall Forum, Boston, on Dec. 17, 1961)

While we’re not yet France, we are not far behind. Did anyone notice the report yesterday from Reuters about the poll in Paris, where almost half of all citizens now think its okay for laid off employees to actually “lock up” or “take hostage” corporate executives—without any due process of law—as part of labor bargaining?

Or, did you notice that just this week, the day after North Korea successfully test launched a long range ballistic missile that means they can not only threaten our Asian allies but Hawaii and Alaska as well, our government announced its intention to actually reduce our missile defense budget, including the money allotted for existing self-defense based weapons systems stationed in Alaska. This brings to mind former US President Ronald Reagan’s warnings in the 1960’s against appeasement and unilateral surrender to the Soviets. But, I don’t want to get too distracted. How about his statement regarding creeping socialism and the risk to the American businessman?

It is time we realized that socialism can come without overt seizure of property or nationalization of private business. [My note: Today, the federal executive speaks openly about seizure and nationalization of banks and financial institutions]

It matters little that you hold the title to your property or business if government can dictate policy and procedure and holds life and death power over your business. [My note: The President of the United States just fired the chief executive of GM]

The machinery of this power already exists. Lowell Mason, former anti-trust law enforcer for the Federal Trade Commission, has written “American business is being harassed, bled and even blackjacked under a preposterous crazy quilt system of laws.” There are so many that the government literally can find some charge to bring against any concern it chooses to prosecute. (Ronald Reagan. A Time for Choosing, Speech given October 27, 1964)

This is a reality far too few American’s have sobered up to realize. Which, brings me back to where I started. Have I been indicted? No. Will I be indicted? I don’t know. Am I preparing for it? As best I can. Regardless of what happens, I’m sure its only more likely that I’ll eventually be indicted as I continue to criticize the government, government employees, the lazy government PR media, and now complicit lawyers.

The point, however, is that it’s not really me who will be put on trial in such a case. It’s America, and its citizenry who are already on trial, today.

As for me, I’d actually be kind of a glad—in an odd sort of way—if I am ever indicted, because at least then I’ll be extended the courtesy and privilege of defending myself against actual charges, rather than vague insinuations and secret rumors. Don’t get me wrong, I am not anxious to plunge headlong into a legal battle where most of the deck is already stacked against me, but I will not run from it either. Though I’m certain it would be an extremely difficult road if that day does come—following the example of others who have tried to negotiate with unprincipled, power corrupt bureaucrats and over zealous prosecutors whose pre-condition for negotiation is an admission of guilt, is not something I will choose to accept.

I’m optimistic that this kind of conflict can still be avoided in my case, and I take steps regularly to try and ensure that is the case. But, if it cannot be avoided, while its impossible for me to see the details in advance, or the outcome of such a fight—I refuse to fear it. Why? Well among other things, in most cases, there are still twelve free citizens at the final end of any verdict.

The world of [regulation] is reminiscent of Alice’s Wonderland: everything seemingly is, yet apparently isn’t, simultaneously…It is a world in which the law is so vague that businessmen have no way of knowing whether specific actions will be declared illegal until they hear the judge’s verdict - after the fact. (Alan Greenspan. Later Chairman of the Federal Reserve. Paper given at the Antitrust Seminar of the National Association of Business Economists, Cleveland, September 25, 1961.)

While those with an eye to see, do indeed know the final end to this story (to paraphrase Dr. Skousen), none of us knows the details regarding our own personal challenges on the path to our ultimate rendezvous with destiny (to paraphrase another great hero of mine). The only option is to choose; to make a choice when the options are clear, and the chaos and tension that accompanies conflict has not yet become overbearingly personal.

I made my choice early on, when I first encountred these people. I made my choice before the huge successes and before the tragic business failures that have defined the last several years. I’m not proud or happy about the business or financial failures that have so closely affected my life, and the lives of so many of my friends and loved ones. Nor can I rest from my own labor to compensate for the ones for where I bare primary responsibility. But failure, financially—short or long term, has never been the enemy of free citizens in America, or throughout history. Failure, morally—to stand up for right, for freedom, and for truth—this is a failure that I consider the most serious enemy of all. As economic freedom is threatened broadly, across all parts of the world’s citizenry, each of us are increasingly exposed the fact that we have an inescapable choice to make, individually.

How about you? How will you react when you have your day in court (literally or figuratively)? Do you think that somehow you can escape the consequences of the rocky cliffs ahead? Will you just coast along the tidal wave of life that carries you about from day-to-day while you complain as you go that your life isn’t what you want? Or, will you stand up? Will you say to freedom’s common enemy, “There is a certain point beyond which you cannot pass!”

I’m sure the slobbery thickness of brain-off emotionalism will continue to bring more people to my door in the future asking about some supposed, pretended, or actual indictment–or maybe even worse. But, in the mean time, me and those who stand with me (including the consistently growing numbers of those who will be standing with me tomorrow and the next day, and the days after that), we will keep producing, educating, and organizing. And, when we can squeeze it in (and I’m pretty sure it’s something we’ll not soon forget), we’ll also do what we can to make sure the complicit schmuck’s (including those in the media, the legal profession, and in key government positions) who keep overstepping their bounds, to the detriment of innocent and free citizens, are also made to face the legal consequences of their own wrongdoing. I doubt that they’re any more anxious to face a just tribunal than have been any of history’s well known tyrants and their dimwitted, brain off accomplices.

It looks like a foot race, and they better hope we don’t beat them to the punch!
Email, Print, Share:

* Digg
* del.icio.us
* Facebook
* Google
* Blogosphere News
* E-mail this story to a friend!
* Faves
* LinkedIn
* Live
* MySpace
* Print this article!
* Reddit
* StumbleUpon
* Technorati
* TwitThis
* Yahoo! Buzz
* YahooMyWeb

Tags: bailout, brain off, business america, business failures, capitalism, challenges, citizens, corporate scandals, corporate wrongdoing, debtors prison, entrepreneur, indictment, money, notorious case, realization, rick koerber, Ronald Reagan, socialism, tax fraud

*

Comments
21 Responses to “Rick Koerber Indicted? Schmucks, Grand Juries, & the Trials Ahead.”

1.
Freedom From Creditors says:
April 8, 2009 at 10:19 pm

Rick,

A lot of people are accepting socialism because capitalistic good business owners like yourself get beat up and persuaded to be silent by government bureaucrats or face indictment and criminal charges. I like that your taking a stand because many of this nation’s good people are faced with adversity and loads of debt problems which have forced and converted many into a government bondage mentality. What most people don’t realize is that the culprit for most of the financial sturugles this country has had is because of the banking system and the Federal Reserve. Both the Federal Reserve and the banking system should be eliminated and attacked for the fraud that it has perpetrated upon this country.
Reply
2.
Ammon Nelson says:
April 8, 2009 at 10:58 pm

I am glad to say Rick, that I have never blamed you for my financial difficulties, though I probably experience similar financial difficulties to some of the brain-off individuals who do blame you.

I wish you the best in you fight against government corruption. I am joining you in your fight - though I don’t corroborate or associate personally with you. I agree with your philosophy and paradigm and am doing my best to spread the message of free and intentional thinking, which is so much lacking in our modern culture. Hopefully you consider me an ally.
Reply
3.
Dave Montague says:
April 8, 2009 at 11:09 pm

Rick,

You and I only met a couple of times at the Spanish Fork gym. We have never done business together. What I want to say is I totally admire how you have stuck to your guns and persevered through a mire not many will ever come to know.

There is something wrong with a society so eager to punish. Friedrich Nietzsche made this observation: “But thus do I counsel you, my friends: distrust all in whom the impulse to punish is powerful!”

Stay the course my friend!

All the best,

Dave Montague
Reply
4.
Brad King says:
April 8, 2009 at 11:42 pm

I would love to talk to Rick about the money that was invested through Northridge investments into FC. I am not in the least belligerant but would simply like to discuss what I can expect and thus prepare myself for the outcome.
Reply
5.
Ryan Dana says:
April 8, 2009 at 11:51 pm

Rick,

My name is Ryan in St. George. I loaned J*** D***** $140,000. That situation sure sounds a lot like mine the only difference is I never loaned out any money to you. I would like to know the blog source you read that comment from. I would like to investigate because I don’t like people throwing my name around like that. It could’ve been another Ryan but I doubt it. Please email me that blog resource.

I understand you are trying to make a point but taking a blog note as fact can be misleading, especially if someone decided to throw my name in the blog and info without understanding any facts.

If you could change the name on your blog to maybe a fictitious name that would be great. I understand Jake’s business had some financial difficulties and I have never pursued anything with the $140,000 that he owes. I have never publicly stated my displeasure for the whole thing and I have chosen to move forward until his situation becomes more fortunate and it is up to him to square up with me. As for myself, I have learned a great deal in the school of hard knocks and have vowed to learn from my mistakes.

Thanks,

Ryan

*** added by editor for privacy purposes.
Reply
6.
Dave Charbonneau says:
April 9, 2009 at 12:13 am

Thanks, Rick, for sharing your thoughts and standing tall. Emotional warfare, popularity contests, and seeking un-earned rewards… I thought this stuff went away in high school. Challenge is, those “winning formulas” learned in youth are tolerated and - in the short term seem to be externally rewarded. Power is such a strange temptation to figure out. Learning, living, and defending the principles of freedom certainly make for a more rewarding life; no matter the garbage that others promulgate as truth for their personal gain. I, as with most, do not know your business, your circumstances, or the intents of your heart and mind. However, I do know it is common human behavior to seek a fight in the name of their own fears, inadequacies, and general misunderstanding of their own values. As such, I refuse to read the ‘comments’ section on any online news story where accusations are being made. The Founders also understood this nature of ours, and that of the corruption of power.

I have you and Les to thank for first introducing me to the meaning and existence of governing Principles. Thank you.

Learn, Live, Defend.
–Dave Charbonneau
Reply
7.
Kathy and John Hansen says:
April 9, 2009 at 1:57 am

Nice to hear directly from you Rick. Yes, we saw the new reports. Yes, we’ve heard the rumors too. And yes, we agree with all you’ve articulated about the media manipulation of the economic climate. Thanks for speaking out. Thanks for saying what so many of us feel but can’t put into words. Count us among your supporters, praying for your success.
Reply
8.
Joe Olivas says:
April 9, 2009 at 3:22 am

Rick,

I thank you for your candor and will say publicly here, as I know many will read your message, that I believe with every ounce of my being that you have in no way, shape or form been anything than honorable with me. I know and understand that those who are seeking such difficulty to fall upon you and your family are doing so simply because they lack integrity, refusing to take accountability for choices they have made. Emotion is a powerful factor my friend, and those who govern their lives in this manner, are left open to powerful mistakes in judgement.

We will all, one day, when everything is clear before us, have our day in court. No jury will be present at the trial of which I speak, however, there will indeed be many on the witness stand. You are counted in my life as a true friend, as an incredible example, and even greater still as a mentor of the mind. As such, when this day comes for you my friend, I can witness with a clear conscience, “Not Guilty!” While I cannot state for a certainty what the course of events will be like in the temporal sense, my answer will be the very same nonetheless. For how can one pronounce unearned guilt?

I have made my choice, I know on which side of the line I stand. I know at who’s table I sit. Our land, our country, freedom and liberty is far too precious for me to not have made this ever important decision. My life, as I choose to live it, is one that I love. Those who hide in the shadows of deceit are too fearful of the light to stand with those who love their lives. And in their misery and darkness, they seek to destroy others who no longer live in their world.

Les once said, “The World is Changing…” I believe he was right. I believe in part, that he was speaking to me personally, in that I have the power within myself to make it so. Every day, I live in the World of My Choosing, and it is something I must protect. As there are indeed many who seek to destroy my world around me simply because they do not see what I see. They do not feel what I feel, nor do they know what I know. Namely, that A is A!

Joe
Reply
9.
Randy Soderquist says:
April 9, 2009 at 8:56 am

Rick, (captain my captain, Dead Poet’s Society)

My life today is amazing! In a large part this is due to the principles that you teach and that I am striving on a daily basis to better understand and apply. As I face my own fears and observe what is happening in our society today, I am comforted by the fact that principles govern. Thank you for sharing your talent of teaching and explaining principles in a way that for me, has helped me to see my life and the world from a truer perspective.

Thank you for taking a stand and for your courage to follow principles and to do what is right, come what may! I appreciate you, all that you do and all that you stand for!

Vai firme,

Randy
Reply
10.
Don Thornton says:
April 9, 2009 at 9:59 am

Rick, thanks for showing a possible future for my business. I’m glad to see from the other comments here that there are still many in the world fighting for freedom. I’m starting to know what that means and the first step is to wake up! I may hit my snooze alarm once or twice, but I’m excited about life and I’m aiming for full consciousness. Life is sweet beyond the deceptions.
Reply
11.
Andreas Fischer says:
April 9, 2009 at 11:50 am

Dear Rick,

in concideration of the fact that no holy land is left on earth so far territorialy we have to choose it mentaly. This is what I constantly say to myself thinking of reasons for emigration because of misleading society - at any place on earth.

Due to my dear friend Caspar I found out about the sainthood of principles you and your’s have rediscovered from ancient societies, constantly spreading the word of truth. I’ve joined in with you on November 25th, 2008, far away from America by doing my pledge. And today I don’t hesitate standing forth to confess that I am a citizen of the wolrd belonging to the capitalistic society. Whatsoever the name of the country I live in is. Whatsoever the people around me do think or, even worse, do not think. Principles govern, you just have to keep going.

Love,
Andi
Reply
12.
Jeremy Parkin says:
April 9, 2009 at 2:31 pm

Keep your head up, keep moving forward, and trust that God will help with the slack.

Jeremy
Reply
13.
Lance Jackson says:
April 9, 2009 at 2:49 pm

It is refreshing to see conviction to Principle that runs deep, even to the core. I am pleased that Rick calls me out and challenges me to be more than just a “Sunshine Patriot”. It is his example, in such circumstances, that inspires. I am not so eloquent as Rick, but I count myself as one of his supporters.

I count myself blessed that we have an example to emulate. Though he is not a perfect being, I can learn much from his dedication to truth. He has signed the Declaration of Independence and has pledged his Life, Fortune and his Sacred Honor. Is anything less asked of us?
Reply
14.
Stephen Street says:
April 9, 2009 at 5:12 pm

This is the era of the “Rich Hunt”. Even perceived wealth makes you a target.

Top down thinking and mindless education by memorization is creating a society comprised of a pack of wolves willing to attack as ordered.

Not more than 30 years ago something which was stupid was called what it was and forgotten. In 2009 stupid activity is given a euphemism or called a criminal activity depending on the mood of the accusers.

The problems you are experiencing would be the result of your public persona. In your case the only thing that matters is that the ideas you promote are contrary to the indoctrinations by the social engineers.

Sorry for your problems. Your persecution goes with the territory.

As my own financial situation improves I understand and sympathize with you. I have lost money. It was my fault. No need to sue because I learned from my experiences. Failure is the price we pay for success.
Reply
15.
Joseph Graves says:
April 9, 2009 at 5:24 pm

Stand strong. TONIGHT i start the first (know) Free Capitalist meeting in Nashville. Although we are all not done 100% with our Pledge Quest. Soon. I can not stand by as we watch heroes like Rick, and others, battle against the bureaucrats who seek only to justify their existence through leeching others. I have complied the Primer and select podcasts to hand out on disc. Officela formation will come in the next 2 weeks. I have been fighting, as a new FC, to set my paradigm in prosperity, not scarcity. Especially during these “challenging economic times”. STAND UP. Be free. Do not sell yourself into modern slavery. Gather with the like mined. learn the principles, spread them to the rest of your community. God bless us all. Thank you Rick!
Reply
16.
Mister Mike says:
April 9, 2009 at 5:38 pm

Was reading your article yesterday and was going to immediately respond but thought better.

Still stuck in the angry capitalist mode I see. I stopped reading your article when you berated those around you who were attempting to show support. Have you ever read the book “How to Win Friends and Influence People”?
While I chose not to associate myself with your way of promoting principles I also am not going to line up to kick you while your down.

May I suggest that you stop sticking your finger in the eye of those who have the power to further make your life hell especially since you apparently no longer have the resources to fight them? Also, accept support from friends and associates as they feel comfortable giving it rather than thru your narrow filter. A strong dose of humility is in order.

Oh, and I am a big believer in standing strong on principles but I’m also learning that you have to pick your battles.

Mister Mike
Reply
17.
kev says:
April 9, 2009 at 8:52 pm

Thanks for the article.

You know, the Leninists did the same thing. They pillaged and killed any producers they could find and called it eliminating the upper class, but they went so much further, until almost no business people were left.

Then, they did it again when the common people assigned top run farms couldn’t produce - they killed them, too, who were trying to become new producers in their communist system.

I consider my self a producer, and though I don’t have your experience and exposure, plan to stay the course.

Thanks again.
Reply
18.
Ken James says:
April 10, 2009 at 4:30 pm

Rick, I support you 100%! On a personally level, I know how people will not be accountable for their actions, and yet want to pour the blame on someone else. I know how a businessman can be honest in his dealings, and show people how to make money with a CLEAR up front understanding of the RISK and the REWARDS, and when their are profits being handled out, the world is a great place, the sun shines bright, but when their is a loss, it is everyone else fault.

Their is always jealousy and envy from people; and those same people have the opportunity to make their own life better without holding a honest businessman in contempt. I joined the FreeCapitalist Project because of your teaching and even more so, because of what you have gone through.

I salute you for facing evil, unjust, hypocrites, who are only out to mooch and loot!
Reply
19.
Kevin Whittington says:
April 10, 2009 at 8:58 pm

Towards the tail end of the 90’s I loaned $80,000.00 to John D. VanHove, (AKA Johnny Liberty). The money was supposed to be for a short term,(1 month) and return 8%. I had read many of John’s publications and met him and we had mutual friends that had known him for years. Soon, 3 months had gone by with frequent contact from John explaining the delays. I even called him explaining that I needed at least $3,000.00 for something or other and he sent the 3K to me from his personal checking account. I considered and consider him an honorable and honest man. Soon, John was being investigated and I was sent on an all expense paid trip to Hawaii,(John’s home state). I told the Investigator/Prosecutor’s that I was responsible for my decision and believed that John was doing his best to pay us our principle. (We found out later that someone he had been working with had taken all the money and skipped the country). John was the only one left to take the blame - and he did. I told the Prosecution to punish him by letting him do his job so he could pay all the loans back. Of course they didn’t really care what I thought and John went to prison for 5 years. With the exception of the 3K he paid me we have recovered an additional $464.00 of the $44,000 the government decided he owes me now. Of course, if I were John, I would feel that 5 years of my life was sufficient to repay my debt. Justice has been done. Society has been repaid and the Government Attorneys have done their job. Another horrible Villian has been put in his place so he can’t hurt any more innocent greedy people. Only thing is — My $76,536 is still gone and my friendship with a good man, John VanHove is over. While it has been a painfully expensive lesson, it is one that I needed. Relationships are what has true value. Rick, I miss chatting in your cubicle at Franklin Covey. Thanks for the journey.
Reply
20.
Tim Usher says:
April 13, 2009 at 4:53 am

The subject of and cause for your article reminds me of a passage from ‘Atlas Shrugged,’ page 436:
“…There’s no way to rule innocent men. The only power any government has is the power to crack down on criminals. Well, when there aren’t enough criminals, one makes them. One declares so many things to be a crime that it becomes impossible for men to live without breaking laws. Who wants a nation of law-abiding citizens? What’s there in that for anyone? But just pass the kind of laws that can neither be observed nor enforced nor objectively interpreted–and you create a nation of law-breakers–and then you cash in on guilt…”
We all ought to be wary of over-reaching legislation and regulations, some recently rushed through under the guise of urgency, and the motives of those who are empowered to implement and prosecute according to such.
Keep your guard up Rick.
Reply
*
Robert Arbuckle says:
April 19, 2009 at 6:15 pm

We have a son who sits in a Federal Prison I believe for many of the same reasons you listed in the article about grand juries and federal prosecutors. Not only were we threatened about getting him a descent attorney but when he was coereced into taking a plea deal the prosecutor never lived up to his promises. In the Eastern District of Texas prosecutors are out of control and the court appointed attorneys are working with them. We could tell you stories about the judges too. Is there anyone that could help us?

Rick Koerber Speaks to the American Public on Capitalism, The Legal System, Judgment and The NEW WAY of doing business, Robert Paisola Reports

2009-04-08T15:53:00.000-06:00

To our readers around the world:

As many of you know, we have been following the Rick Koerber and Franklin Squires matter for over two years. In recent months we have had the opportunity to meet with many people about this issue, and have listened to some very serious conversations.

Based upon our review of the law, and the time that we have spent with Mr. Rick Koerber, we have concluded that there is absolutely NO WAY that the items that have been stated about Koerber COULD be true. After dealing with thousands of pages of data, empirical data analysis, and sheer time line reviews, Rick Koerber was nothing more than a person who was working with friends and his friends decided that they could do a better job.

As you know, some of those people have now been indicted and sent to federal prison. We have spent over 100 hours with Rick Koerber and have seen the data and heard the conversations.

We are convinced that he was manipulated at a very high level of government and our interviews with Members of The State of Utah House of Representatives and the Utah State Senate, concur.

Based upon this conclusion, we now present an article that was recently released by Mr. Rick Koerber in its unedited form.

All questions or comments should be sent to investigations@mycollector.com

Rick Koerber Indicted? Schmucks, Grand Juries, & the Trials Ahead.
April 8, 2009

As our modern culture hurls itself imperviously over the rocky cliffs of socialism in the name of rescue and bailout, normal people seem to be losing their ability to think critically and distinguish decency, fairness, civility, and honesty from rumor, rhetoric, political posturing and gossip. Its a cultural battle being waged every day in the business world, and I don’t mean just big business, I mean small business America too.

The competition is decency vs. defamation. Do-gooders, versus society’s most valuable doers. In my world, the constant reminder of this battle is the fact that hardly a week goes by without someone asking me if I’m going to be indicted.

A chilling result of the crisis will be furthering the deadly process of criminalizing business failures. In the old days when an enterprise failed, the proprietors often ended up in debtors’ prison…But in recent years, particularly after the Enron/WorldCom corporate scandals, federal and local prosecutors began actively pursuing evidence of fraud whenever a big business went bust.

Yes, there has been corporate wrongdoing, and miscreants have been tried and jailed. But many noncriminal individuals have been pursued.

One notorious case was the IRS’ attempt to prosecute KPMG and a number of its partners and employees for alleged tax fraud. The shelters KPMG sold in the 1990s were not illegal. The IRS still determined, however, that they weren’t valid. That kind of tax dispute would normally be settled in civil court. Instead, prosecutors threatened KPMG with annihilation: Settle on our terms or we will hit you with an enterprise-killing indictment.

Arthur Andersen had recently been destroyed by such an indictment, even though the courts subsequently threw the charges out. The feds even pressured KPMG not to pay the legal bills of the targeted individuals–which would have forced these people to settle, as they couldn’t afford the massive legal costs of defending themselves. Thankfully, a courageous federal judge stopped this abuse.

But the itch to indict remains. No sooner had Bear Stearns, Lehman Brothers and AIG gone bust than criminal investigators swarmed in. They will find evidence of “fraud”–why didn’t you more aggressively mark down the value of suspect paper even if there wasn’t a market for it?

Why the expressions of confidence in the soundness of your businesses when the rumors of trouble were surfacing? Lost in all this will be the fact that Lehman and AIG didn’t know they were in mortal peril until almost the very end. There will be indictments. The chilling lesson: Unsuccessful risk taking or failing in business can send you to prison. (Steve Forbes, “How Capitalism Will Save Us” Forbes Magazine, Nov. 10, 2008) Emphasis added.
It’s a dumb question really.

It’s not like the government, even with the most corrupt bureaucracies, normally calls up the subject of its investigation on the telephone to say, “Hey, just for your information, we’re planning to indict you.” But, the brain-off among us don’t have to be bothered with thinking—they’re too busy indulging in feeling.

In January of this year a local news reporter came to my house and asked me point blank, “But, is it fair to say you expect to be charged?”

Rick Koerber. Some people want to see me behind bars. This is the closest I've come so far. Which I'm hoping annoys the socialists, and my old friend Abel Keogh, daily!

The reporter, Brian Mullahy(See our comment below regarding KUTV Reporter Brian Mullahy), and I had been having a conversation about the fact that there have been rumors about me being in trouble with the law, despite no charges, nor formal complaints and no formal allegations of wrong-doing, over the course of the last five years. In that context, I had complained that the very existence of these persistent rumors—even the ones with no credibility whatsoever—had actually given bureaucrats the ammunition they needed to continue their years long investigation of me and my companies without any reasonable basis.

In answer to an earlier question I explained that I, in fact, had not been indicted or charged either on the state or the federal level and that I did not know what was being planned by prosecutors.This was the context for his question “But, is it fair to say you expect to be indicted?” I thought about his question and reluctantly answered, “Sure, sure.”

I went on to say in our interview that given the modern business climate in America any businessman in a situation like mine—regardless of his innocence—would be foolish not to prepare as if an indictment were coming. Of course, all this context was dropped when the evening newscast aired with the headline, “Utah Businessman Facing Federal Charges.”

This, of course, is a lie. I was not then, nor have I ever in my life, been facing federal charges.
It used to be a criminal offense to slander someone like this, but now we live in a world where it’s considered by many to be journalism—while at the same time businessmen are routinely accused of criminal behavior by vague allegation, outright defamation, and little attention given to facts or statutes and usually without the businessman having done anything that can be demonstrated to be clearly against the law.

This situation, which is the fruit of socialistic ideas in government, has been a growing reality in America for the last full generation and is now a defining legacy.

As a result, it is practically impossible for a lawyer to determine what business conduct will be pronounced lawful or unlawful by the courts. This state of affairs is equally embarrassing to businessmen endeavoring to obey the law and to Government officials attempting to enforce it.” (Robert H. Jackson. Assistant Attorney General of the United States.

Later Supreme Court Justice of the United States. Anti-Trust Legislation Seen Necessary, New Jersey Law Journal, February 3, 1938, 6 N.J.L.J. 37 (1938) c. 1938 ALM Properties, Inc.)
So, our modern itch to indict, as referenced by Steve Forbes, continues to have affect in my life, and the same questions come week after week. The rumors this past week were stirred up by none other than prominent Salt Lake attorney Rodney G. Snow. He should know better, but we’ll talk more about that in a minute.

Indictment, indictment, in·dite·ment! Sometimes the questions come from those secretly hoping the rumors are true and that soon I’ll end up behind bars (for just what exactly, they can never quite articulate). Sometimes the questions come from brain-off, but kind hearted friends who just want to express their sympathy (again, for what, they can’t quite articulate.) It all makes me want to throw up, to tell you the truth.

I’ve reached a point in my life where I just can’t stand the slobbery thickness of brain-off emotionalism. I care nothing for the predicaments of those whose own emotional insecurity has brought them to the point of thinking that I’m somehow a villain in their life story when at the same time they don’t have the courtesy, civility, or kind feelings sufficient to talk to me and either get the facts to clear up their misconceptions or, on the rare occasion that there is actually something amiss between us, give me the chance to take responsibility for whatever wrongs or mistakes may, in fact, be mine.

Even worse, I’ve grown sick of the ever growing popularity of the notion that in the present era of bail-outs, bank failures, unemployment and rampant foreclosures, a consumer being stupid (or at least imprudent) and loosing a lot of money somehow qualifies him or her to randomly assign blame and self-righteously demand guilt from whatever businessman seems to fits the bill at the moment—facts be damned. These people are schmucks, and those who are moved by their groveling selfishness enable the sad state of affairs, so often talked about these days. They are complicit in our societies unyielding march towards disaster.

Do I have empathy for those whose financial situation is bleak? Of course. I’ve dedicated my life reaching out to and teaching these very people. However, that is part of the problem. Whenever you dive into deep water, in an effort to save a drowning person, you become at risk yourself. I can’t otherwise explain how so many people whom I’ve never done business with can be so maliciously engaged in the spreading the negative rumors and gossip—almost wholly started years ago by unprincipled, privately motivated, reckless and vindictive government employees.

I once read a post on the Internet that stated, “I would love to talk to someone about the $140,000 that Rick Koerber has of mine that [he] ‘can’t pay’ me back. Thanks. Ryan in St. George.” Evidently I don’t qualify as the kind of “someone” this person wants to talk with, because I have never been contacted by him. Not only do I not recognize his name or situation, the sad reality is that I don’t know anyone in St. George, Utah named Ryan who has ever given me anywhere close to that kind of money.

I certainly do not have, nor do any of my companies have, to the best of my knowledge, any unpaid debts in any amount to someone named Ryan in St. George.

Such a small thing like this illustrates a major problem in our world today, particularly with federal grand juries. I have known, for example, that as early as March 2008 there have been witnesses being called by the US Attorney in Salt Lake City, to testify before a federal grand jury regarding my supposed business dealings. But in a federal grand jury proceeding I don’t have the right to confront any witnesses.

The rules of evidence are not the same, and there is no cross examination or rebuttal. So, this guy named Ryan could be called before the grand jury, asked to testify about his $140,000, and this could be used as undisputed grounds to issue an indictment. The problem is compounded by grand jury secrecy.

The fifth amendment to the US Constitution is the legal cornerstone for federal grand juries, and the original purpose of a grand jury, including the secrecy of its proceedings, was originally to protect citizens from government abuses.

During the era of the Founders (most would be surprised to learn) there were no government attorneys. But, today the US Attorney oversees cases before the grand jury and he (or a member of his staff) is essentially given de facto control over access to the grand jury by the public, and the secret proceedings they carry out. Once a fair minded person begins to think through the implications of this modern court setting, serious issues regarding justice and fairness begin to emerge.

What is true about the danger of “enterprise-killing” charges today, was also true in the days following America’s revolution. The Founders sought to protect citizens from overzealous government by ensuring federal felony charges could not be brought whimsically or too easily, thus the requirement of a grand jury. Secrecy, during grand jury proceedings was a long standing English tradition dating back to the Magna Charta.

A critical defense of free society rests upon the notion that the very allegation of wrongdoing, made by the government, can be punitive in-and-of itself, and the process must therefore be strictly guarded.

So, the grand jury is generally supposed to be private/secret. The idea is that before charging a free citizen with a crime, a person who is presumed innocent until proven guilty, give a jury of his or her peers the opportunity to consider the case first, without exposing his reputation to ruin by the process. Of course, there are other reasons for secrecy but the rights of individual citizens are at the foundation of the issue.

The problem today is that, with permanent government prosecutors essentially in charge of the grand jury proceedings, what was once a protection for citizens now, too often, is only an advantage to the prosecutor. Today, there is very little check against malicious prosecution or prosecutorial misconduct when all the proceedings are conducted in secret.

Take for example the political motivation to tip the party balance in the United States Senate which utilized prosecutorial corruption in the recent case of former Alaska Senator Ted Steven’s whose case was just thrown out—after he suffered great harm to his reputation and after he lost his Senate seat, all because of the situation I’m describing. It is therefore, not surprising, that according to experts in the field, in 95% of the cases, prosecutors simply get an indictment, whenever one is wanted.

This means that a businessman has no way of knowing in advance whether the action he takes is legal or illegal, whether he is guilty or innocent. It means that a businessman has to live under the threat of a sudden, unpredictable disaster, taking the risk of losing everything he owns or being sentenced to jail, with his career, his reputation, his property, his fortune, the achievement of his whole lifetime left at the mercy of any ambitious young bureaucrat who, for any reason, public or private, may choose to start proceedings against him…It is a form of persecution practiced only in dictatorships and forbidden in every civilized code of law.

It is specifically forbidden by the United States Constitution. It is not supposed to exist in the United States and it is not applied to anyone-except to businessmen. (Ayn Rand. Capitalism: The Unknown Ideal, pg. 50 - from a speech given at the Ford Hall Forum, Boston, on Dec. 17, 1961)

In my case, after a failed attempt by rogue state regulators that felt just as Ms. Rand describes, I’ve now learned more about what the federal government is up to, and what is happening before the grand jury, through rumor and gossip—than is supposed to be publicly available at all.
What good does it do to say to me, “We’re protecting your reputation Rick, by ensuring everything is done in secrecy,” when attorneys, government employees, and even members of the prosecutor’s staff are reportedly giving information about secret grand jury proceedings to their colleagues like Mr. Snow, who seem driven to spread the word around.

Lest you think its just any old attorney involved in such behavior, Mr. Snow’s resume shows just how connected he is, having worked as an Assistant US Attorney for this very same office earlier in his career. Mr. Snow, by his privileged position, evidently not only receives special illegal exemption from the legal requirements of secrecy, but he gets to use them to further his law practice at my expense.

There is a strange, almost unnoticed drum beating in our popular culture, where economic hard times (which are the persistent handmaiden of socialism and its relatives) bring average Americans to believe that society’s producers are now somehow the villains. Even worse, our bureaucrats, government employees, and government officials are supposed to become our heroes. In the Founder’s generation we elected heroes to office, to keep abusive government in check.

Today we try to make heroes out of those who like to cast aspersions without consequence, spend money without accountability and who send out bureaucrats and government agents with guns, threats, and the delegated force of the people—to satisfy our itch to indict and to punish society’s white collar villains—who, in rapidly growing percentages, are increasingly men and women whose crimes can’t be described or articulated and whose actual performances and intentions are almost entirely irrelevant.

Lost is the idea that businessmen, entrepreneurs, and even corporate executives (regardless of their supposed crime) are still citizens, in a free country, presumed innocent until proven guilty—also born like the rest of us, with unalienable individual rights.

Only businessmen - the producers, the providers, the supporters, the Atlases who carry our whole economy on their shoulders-are regarded as guilty by nature and are required to prove their innocence without any definable criteria of innocence or proof, and are left at the mercy of the whim, the favor, or the malice of any publicity-seeking politician, any scheming statist, any envious mediocrity who might chance to work his way into a bureaucratic job and who feels a yen to do some [governing]. (Ayn Rand. Capitalism: The Unknown Ideal, pg. 44 - from a speech given at the Ford Hall Forum, Boston, on Dec. 17, 1961)

While we’re not yet France, we are not far behind. Did anyone notice the report yesterday from Reuters about the poll in Paris, where almost half of all citizens now think its okay for laid off employees to actually “lock up” or “take hostage” corporate executives—without any due process of law—as part of labor bargaining?

Or, did you notice that just this week, the day after North Korea successfully test launched a long range ballistic missile that means they can not only threaten our Asian allies but Hawaii and Alaska as well, our government announced its intention to actually reduce our missile defense budget, including the money allotted for existing self-defense based weapons systems stationed in Alaska. This brings to mind former US President Ronald Reagan’s warnings in the 1960’s against appeasement and unilateral surrender to the Soviets. But, I don’t want to get too distracted. How about his statement regarding creeping socialism and the risk to the American businessman?

It is time we realized that socialism can come without overt seizure of property or nationalization of private business. [My note: Today, the federal executive speaks openly about seizure and nationalization of banks and financial institutions]

It matters little that you hold the title to your property or business if government can dictate policy and procedure and holds life and death power over your business. [My note: The President of the United States just fired the chief executive of GM]

The machinery of this power already exists. Lowell Mason, former anti-trust law enforcer for the Federal Trade Commission, has written “American business is being harassed, bled and even blackjacked under a preposterous crazy quilt system of laws.” There are so many that the government literally can find some charge to bring against any concern it chooses to prosecute. (Ronald Reagan. A Time for Choosing, Speech given October 27, 1964)

This is a reality far too few American’s have sobered up to realize. Which, brings me back to where I started. Have I been indicted? No. Will I be indicted? I don’t know. Am I preparing for it? As best I can. Regardless of what happens, I’m sure its only more likely that I’ll eventually be indicted as I continue to criticize the government, government employees, the lazy government PR media, and now complicit lawyers.

The point, however, is that it’s not really me who will be put on trial in such a case. It’s America, and its citizenry who are already on trial, today.

As for me, I’d actually be kind of a glad—in an odd sort of way—if I am ever indicted, because at least then I’ll be extended the courtesy and privilege of defending myself against actual charges, rather than vague insinuations and secret rumors.

Don’t get me wrong, I am not anxious to plunge headlong into a legal battle where most of the deck is already stacked against me, but I will not run from it either. Though I’m certain it would be an extremely difficult road if that day does come—following the example of others who have tried to negotiate with unprincipled, power corrupt bureaucrats and over zealous prosecutors whose pre-condition for negotiation is an admission of guilt, is not something I will choose to accept.

I’m optimistic that this kind of conflict can still be avoided in my case, and I take steps regularly to try and ensure that is the case. But, if it cannot be avoided, while its impossible for me to see the details in advance, or the outcome of such a fight—I refuse to fear it. Why? Well among other things, in most cases, there are still twelve free citizens at the final end of any verdict.
The world of [regulation] is reminiscent of Alice’s Wonderland: everything seemingly is, yet apparently isn’t, simultaneously…It is a world in which the law is so vague that businessmen have no way of knowing whether specific actions will be declared illegal until they hear the judge’s verdict - after the fact. (Alan Greenspan. Later Chairman of the Federal Reserve. Paper given at the Antitrust Seminar of the National Association of Business Economists, Cleveland, September 25, 1961.)

While those with an eye to see, do indeed know the final end to this story (to paraphrase Dr. Skousen), none of us knows the details regarding our own personal challenges on the path to our ultimate rendezvous with destiny (to paraphrase another great hero of mine). The only option is to choose; to make a choice when the options are clear, and the chaos and tension that accompanies conflict has not yet become overbearingly personal.

I made my choice early on, when I first encountred these people. I made my choice before the huge successes and before the tragic business failures that have defined the last several years. I’m not proud or happy about the business or financial failures that have so closely affected my life, and the lives of so many of my friends and loved ones. Nor can I rest from my own labor to compensate for the ones for where I bare primary responsibility. But failure, financially—short or long term, has never been the enemy of free citizens in America, or throughout history. Failure, morally—to stand up for right, for freedom, and for truth—this is a failure that I consider the most serious enemy of all. As economic freedom is threatened broadly, across all parts of the world’s citizenry, each of us are increasingly exposed the fact that we have an inescapable choice to make, individually.

How about you?

How will you react when you have your day in court (literally or figuratively)? Do you think that somehow you can escape the consequences of the rocky cliffs ahead? Will you just coast along the tidal wave of life that carries you about from day-to-day while you complain as you go that your life isn’t what you want? Or, will you stand up? Will you say to freedom’s common enemy, “There is a certain point beyond which you cannot pass!”

I’m sure the slobbery thickness of brain-off emotionalism will continue to bring more people to my door in the future asking about some supposed, pretended, or actual indictment–or maybe even worse. But, in the mean time, me and those who stand with me (including the consistently growing numbers of those who will be standing with me tomorrow and the next day, and the days after that), we will keep producing, educating, and organizing. And, when we can squeeze it in (and I’m pretty sure it’s something we’ll not soon forget), we’ll also do what we can to make sure the complicit schmuck’s (including those in the media, the legal profession, and in key government positions) who keep overstepping their bounds, to the detriment of innocent and free citizens, are also made to face the legal consequences of their own wrongdoing. I doubt that they’re any more anxious to face a just tribunal than have been any of history’s well known tyrants and their dimwitted, brain off accomplices.

It looks like a foot race, and they better hope we don’t beat them to the punch!

*One final word on KUTV Anchor and Senior Reporter Brian Mullahy- We believe that Brian is one of the best reporters in the news business today. During a meeting with the KUTV Vice President and General Manager, David W. Phillips, on a completely different story, we personally heard his peers including Mr. Phillips praise Brian as "one of the best" reporters out there. This author has come to know Mr. Brian Mullahy over the past year and a half and has learned that he is a man of character, caution, (overly cautious in my opinion!) and someone who will stop at nothing to get the facts of the story correct. This is a much different stress test than that of the citizen journalist and the journalist of the Twitter Generation.

Although we report for all of the networks, have the same media credentials, including CNN I Report, the business of pre-internet journalism requires extreme due diligence. This may change in the near future, and you can read my article on the ART OF THE NEW CITIZEN JOURNALISM MEDIA, published by the international site GroundReport.com by Robert Paisola

To Your Continued Success,

Robert Paisola
CEO
The Western Capital Group of Companies
www.RobertPaisola.com
The Robert Paisola Foundation

Rick Koerber speaks to ABC News, Posted by Robert Paisola

2009-01-26T19:23:00.001-07:00

This is an interview that Rick Koerber just did with KUTV in Salt Lake City, We at Western Capital make no judgment on this statement, other than Rick is doing exactly as he promised and is making himself available to you and his candor and honesty is admired.

Robert Paisola
CEO
MyCollector.com

Exclusive-The Rick Koerber Tapes, Part 1 of 26 By Robert Paisola

2009-01-11T01:25:00.000-07:00

"Hey Wayne Kline, This is Rick Koerber, Am I going to be indicted? I just got an anonymous call!" ..... CLICK
___________________________________

As promised and on time We now are releasing what we are referring to as Tape One of Twenty Six Items of Data that are related to the Franklin Squires Investigation.

In this call between Mr. Rick Koerber and The Director of The Division of Securities for the State of Utah, Wayne Kline that occurred in December 2008.

This tape is completely unedited and is presented in RAW form. This tape is the sole property of Robert Paisola and Western Capital Multimedia and may NOT be reproduced without the sole written consent of Western Capital Robert Paisola or its Assigns.

Link to Story One

Link to Story Two

Link to Story Three

The Western Capital / Wayne Kline Call

THE FIRST RELEASED RECORDING:

Our Observations:

1) Utah State Securities Director Wayne Kline, hangs up mid conversation, obviously in a stupor of thought, later to make an excuse that he had inadvertently dropped the line.

2) Wayne Kline's verbal response after learning about an employee of his spreading lies about FranklinSquires and Founders Capital was to question a) if it was really his employee
b) instructing Koerber not to say anything to anyone, prior to hearing the tape, and that he would discipline his employee (no wonder people in the Dept. of Commerce don't like their jobs).

3) Klein responds ro Koerber that he now has reason to no longer take our calls at Western Capital Here is a copy of the Call between Robert Paisola and Wayne Kline for our readers around the world to review. Notice the consternation here.

Our readers should note that Klein is openly acknowledging that it is State policy (I might it is also state law) that gov. employees are supposed to discuss open investigations only with those being investigated.

This was said during the Paisola - Kline Call, right before he starts talking to our office about the open investigation that he just told you he couldn't talk about.

Much Much More to Come

Robert Paisola
Editor
www.FranklinSquiresLawsuit.com
www.RobertPaisola.com
801-619-4700
robert@westerncapitalmultimedia.com