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

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

Charges » Accused of massive fraud, Utah businessman claims investigators violated his rights.

By Tom Harvey

| The Salt Lake Tribune

First Published 1 minute ago • Updated 1 minute ago

Rick Koerber, the Utah County businessman facing charges that he ran his real estate investment company as a Ponzi scheme, tried to convince a federal judge Wednesday that he was improperly interviewed by federal agents before he was indicted by a grand jury.

At issue is whether Koerber was represented by an attorney at the time of the February 2009 interviews and, if so, whether the FBI and IRS agents should have conducted them without Koerber’s counsel being present.

     

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Koerber’s current attorney, Marcus Mumford, has told U.S. District Judge Clark Waddoups that the interviews violated Koerber’s rights and federal rules, and he wants any evidence obtained from them to be barred from use by prosecutors who are pursuing 18 counts of fraud, money laundering and tax charges against Koerber.

In testimony Wednesday, Koerber said he was represented at the time by Salt Lake City criminal defense attorney Max Wheeler. That contradicted earlier testimony in which a former state attorney who was working with federal investigators said Wheeler told her that he no longer represented Koerber after he had failed to pay his legal bills.

Koerber said Wheeler did represent him, although he testified he had been unable to contact the attorney from before the first interview on Feb. 13, 2009, until April of that year, when he was told he would be indicted and Wheeler ended their relationship.

"I had not been able to speak directly to Max," Koerber said, although he added that he had talked to two other attorneys in Wheeler’s office and believed they also represented him.

Waddoups continued the hearing until late November to give Mumford time to call Wheeler as a witness.

Previously, FBI Special Agent Cameron Saxey had testified that Koerber had first proposed that he meet with investigators but that members of the U.S. Attorney’s Office had first recommended against a meeting but later agreed after they were told Koerber was not represented by an attorney.

Koerber also testified that he was fearful during the meetings that he would be arrested and that when a question arose about whether he was represented by Wheeler, he declined to abort one of the interviews and leave the FBI offices in Salt Lake City.

"I said, ‘You guys have the badges, I’ll do what you say,’ " Koerber testified.

Koerber was originally indicted on three counts in May 2009, with 19 additional charges added in a second indictment that November. A third indictment was sought by prosecutors after Waddoups tossed out a key piece of evidence from the first two.

The indictments allege Koerber’s real estate investment companies were operated as a Ponzi scheme in which about half of the $100 million they took in were used to make them appear profitable when they were not.

Koerber denies the charges. No trial date has been set.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

COMPLIMENTS OF THE DESERET NEWS

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

Re-Launching Free Capitalist Radio

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


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

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

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

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

'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

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'

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 - THE PRESS CONFERENCE NOW LIVE, By Robert Paisola

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

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