Rick Koerber, the alleged mastermind behind a $100 million plus Ponzi scheme, centered in Utah County received 19 additional charges yesterday from the U.S. Attorney’s office, on top of three charges he received when he was indicted last June (two for fraud and one for tax evasion).
The new charges include two more tax evasion charges, 10 charges of wire fraud. Two charges of money laundering, one mail fraud, six fraud counts in the sales of securities and one count of sale of unregistered securities.
The new superseding indictments indicate that Koerber’s Ponzi scheme actually did not make a profit during 2005, 2006 and 2007.
The superseding indictments also revealed some interesting allegations about Koerber’s business not recently disclosed. A major part of Koerber’s sales pitch as City Weekly reported in “House of Cards” on March 5, 2008, was that Koerber had not only frankly admitted to having violated securities laws in Wyoming in the ‘90s but that with his successful business model he was able to pay off all those previous investors, with interest.
According to the indictment however Koerber “had paid all of his investors in Wyoming back without disclosing that he had used some of the money placed with Founders Capital to make the repayments.”
The indictments also allege publications like Koerber’s Creative Real Estate Lifestyle, magazine, published in Wyoming and distributed in Utah, to make fraudulent promises of wealth to be had, as also reported in CITy Weekly's January 9, 2009 feature "All Bets Are Off". On the back of the March 2006 edition of CREL magazine, for example, a full page ad shows a couple standing in front of a house with an ad that reads “Acquire 3.7 million in Real Estate in 90 Days!” The text below reads: “Using Our Cash. Using Our Credit. Using Our Staff.”
Evidence presented in the superseding indictments also suggests that a former Koerber downline company, Hunter’s Capital has provided evidence to show Koerber knew where investments made through affiliated companies were coming from.
Koerber has long argued that he’s not responsible for the investments people make with companies that invest with him. Where companies like Hunter’s Capital in the past have been censured by the Utah Division of Securities, Koerber has pled ignorance to the conduct of downline companies who have in the past recruited illegal investments from unaccredited investors (investors without the personal finances to hedge against a losing investment).
Hunter’s Capital was one of these downline companies that took its investments and passed them on to Koerber’s Founders Capital, LLC. It was also one company Koerber was quick to distance himself from when Paul Bouchard of Hunter’s Capital pleaded no contest to second degree felony charges for illegally taking $11 million in investments from 140 investors.
According to the indictment Bouchard was used to communicate on Koerber’s behalf a message by email to investors in Florida, who invested with Hunter’s Capital saying: “You have known all along where your money was going and that Rick was using it to do real estate deals.”Koerber’s case in the Utah District Court is still in the discovery phases.