General Conflict | Buzz Blog

Tuesday, January 8, 2013

General Conflict

Posted By on January 8, 2013, 9:00 AM

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On Jan. 7, Mark Shurtleff stepped down from 12 years as Utah’s top prosecutor. --- As is customary, the local media sent Shurtleff off with retrospective profiles of the attorney general's grander moments in the Utah spotlight, fighting for compassionate immigration reform and navigating the tricky politics of policing polygamists.

In deference to his dozen years in elected office, such accounts tend to downplay his missteps, as can be seen in the Deseret News' "Mark Shurtleff's Tenure Marked by Personal and Professional Challenges" here or The Salt Lake Tribune's "Shurtleff Surrenders Soapbox" here.

For a different take, we've compiled a reading guide to Shurtleff's conflicts of interest and scandals that City Weekly has covered (other local media have reported on some doozies of their own). This list is mostly chronological, though some controversies are grouped together.

January 2012—Shurtleff Allegedly Inserts His Presence in a Custody Drama 

Salt Lake City Weekly reported this summer on Shurtleff’s amiable ties to call-center businessman Sov Ouk. Ouk, a campaign supporter, reportedly hired one of Shurtleff’s sons at one of his businesses.

At the time, Ouk's ex-wife said she had filed a restraining order against Ouk for allegations of domestic violence. In January 2012, after the couple had an argument about Ouk not picking up the kids on time, his ex-wife, Johanna Quinones, took the kids to her house.

Later that evening, Shurtleff allegedly drove Ouk to her house and parked outside.

“Just because he was late [picking up the children], he tries to prove a point to me and brings the attorney general to my house at 10:45 at night,” Quinones says. “I did not appreciate that.”

Ouk’s company had previously faced complaints from Utah Consumer Protection, but that didn't keep Shurtleff away. Shurtleff even added his voice as a testimonial to one of Ouk’s products in an infomercial.

June 2011—Shurleff’s Jet-Set Pal Jeremy Johnson Indicted by Feds

Shurtleff’s friendship with controversial Internet marketer Jeremy Johnson dates back to 2008. That's when City Weekly first reported Shurtleff receiving $50,000 in donations from Johnson despite the fact that Consumer Protection was investigating his company at the time. It wasn’t until 2011 that Johnson drew true scrutiny for running a business the FTC alleged defrauded thousands of U.S. consumers out of $275 million through his business IWorks.

The Salt Lake Tribune reported that Shurtleff took in $200,000 in campaign contributions from Johnson and his cohorts beginning in 2008. Shurtleff even took a free ride on Johnson’s private jet on a trip to California in 2009, posing excitedly for a photo in Johnson’s Lamborghini sports car parked by Johnson’s jet on the tarmac.

CW also reported on some interoffice e-mails garnered through a records request after a year-and-a-half-long court battle. The emails showed Shurtleff’s own staff felt their boss had a conflict of interest when it came to taking action against Johnson. In a November 2008 email, Assistant Attorney General Kirk Torgensen told a Washington County investigator that his office shouldn’t get involved in Johnson's local investigation.

“Strictly confidential, this guy is a campaign contributor to Mark [Shurtleff] and pretty good friends with him,” Torgensen wrote. “We should really not take it over…”

Johnson's case is still going through federal court.

July 2009—Company That Donated to Shurtleff Is Charged by FTC

Mentoring of America, a Utah-county based call center, faced three separate state investigations for Consumer Protection violations between 2004-07 and was facing over $100,000 in fines before the Attorney General's Office dismissed the fine and had the company instead join an industry association to reform its practices. The association later disbanded. In 2009, the FTC charged the company in a civil action for running a fraudulent business.

In May 2012, the FTC won its case against Mentoring of America, and it has since been pursuing $450 million in damages the government says the company took unlawfully from more than  1 million U.S. consumers.

As CW reported, the company was also dealing with alleged rampant drug abuse by some employees, which may have been why Shurtleff returned $30,000 in donations the company gave him in 2008.

One prospective MOA customer complained to Consumer Protection that a salesman had dropped Mark Shurtleff's name as a character reference to get her to buy one of MOA coaching programs. As CW reported, Shurtleff allegedly never contacted the salesman who dropped his name nor warned the potential customer that the attorney general was not endorsing the product. In late 2008, the salesman was arrested for shoplifting over $1,500 worth of goods during the holiday season.

June 2009—Shurtleff Allegedly Meets Privately with Convicted Fraudster on Trip to California

In the midst of Shurtleff’s short-lived 2009 Senate campaign against Bob Bennett, Shurtleff took time out to go to California. Shurtleff traveled with long-time friend and political gadfly, Tim Lawson, who, in talking to City Weekly, described the purpose of the trip as  “fundraising.” Shurtleff, however, said it was for relaxation and for taking time to work on his historical novel.

In California Shurtleff had dinner and went to church with Marc Sessions Jenson, a man convicted of multimillion dollar securities fraud in 2008. CW reported that, during Jenson's trial proceedings, Shurtleff felt there had been attempts by both sides to influence him. In 2008, the first plea deal offered by the Utah Attorney General’s Office would have required Jenson to face no jail time and not be required to provide any restitution to his victims. The deal was so lenient, the judge even rejected it.

Shurtleff maintains that during his visit with Jenson in 2009, no discussion about his trial or fundraising took place. Even still, Shurtleff’s campaign financial documents at that time show that a business partner of Jenson's and his wife donated a combined $14,400 to Shurtleff’s Senate campaign. (Jenson was on parole then so he could raise funds to compensate victims. After failing to raise even one dollar in restitution, he was sentenced to up to 10 years in prison in late 2011.)

February 2009—Shurtleff Pens Character Reference for "Fix It Man" Friend

On Feb. 14, 2009, Shurtleff wrote a letter designed to reassure investors of hovercraft business Slipstream International, owned by his above-mentioned friend Tim Lawson. The letter reads: “Over the last 11 years, Mr. Lawson has become a close personal friend,” reads Shurtleff’s letter, “and has demonstrated professional capabilities in business organization, management and administration.” A year later, Lawson filed for bankruptcy with $545,235 owed to creditors.

Lawson used his "in" with Shurtleff to create another line of work for himself, that as a government-relations and corporate-mediation "fix-it" man. In one dispute over the development of a ski resort, Lawson allegedly claimed to have information from the Attorney General’s Office that would be damaging to a business interest. Another businessman who says he employed Lawson’s services said that Lawson threatened to have him thrown in jail if he didn’t give him $7,000.

January 2008—Shurtleff Asks his Taxpayer-Funded Secretary to Schedule Campaign Meetings

According to emails received in a records request, Shurtleff had his state secretary set up a 2008 campaign lunch meeting for him, Tim Lawson and the CEO of Mentoring of America who was bringing him a $15,000 campaign donation. While no other state agency CW contacted for this story thought it was ethical for state employees to deal with their employer's campaign matters, the Attorney General’s Office disagreed, arguing there was nothing wrong with the practice. After all, the Attorney General’s Office interprets election law.

Spring 2007—Shurtleff's Office Declines to Prosecute Ponzi Scheme Operator, Rick Koerber, Who Later Faces Federal Charges.

Rick Koerber was indicted by federal authorities in May 2009 for running a $100 million Ponzi scheme, the second largest in Utah’s history. But years prior, the state had also prepared a case against Koerber that in 2007 Shurtleff’s office refused to prosecute, citing a lack of evidence. As CW reported in the spring of 2007, Shurtleff met with Koerber and then-Rep. Carl Wimmer, R-Herriman to discuss his case. Wimmer also had been floating the idea of moving the Utah Division of Securities—the agency at the time investigating Koerber—away from the governor’s jurisdiction and putting it under the control of the Attorney General's office.

2005—Shurtleff’s Daughter hired at Law Firm that Shortly Thereafter Wins Major Contract for State Work

In late 2005, one of Shurtleff’s daughters allegedly was hired as a paralegal at Siegfried and Jensen, a major personal-injury law firm in Utah. A few months later, the firm landed a lucrative contract to help the state in a class-action lawsuit against Eli Lilly, the maker of Zyprexa, a prescription drug found to have dangerous side effects. The state only approach one law firm with the no-bid contract: Siegfried and Jensen—who in addition to hiring Shurtleff’s daughter had also previously donated $60,000 to Shurtleff’s political campaigns. When CW interviewed a Siegfried and Jensen attorney working the case in 2009, he estimated a possible settlement of $60 million or more to come from the case to benefit the state of Utah. In 2009, however, the drug maker settled with the state for $24 million.

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