Man pleads not guilty in $100M Ponzi scheme

A Utah County businessman accused of running a $100 million Ponzi scheme pleaded not guilty to all charges when he was arraigned in U.S. District Court Friday.

Claud R. Koerber, better known as Rick Koerber, 36, was arraigned before Magistrate Judge Samuel Alba.

Prosecutors handed over several DVDs and CDs full of records to Koerber's defense attorney, Jerome Mooney, and told Alba more evidence would be coming.

"The investigation is continuing, and we will be gathering more," Assistant U.S. Attorney Stewart C. Walz said during the arraignment.

Walz also asked that Koerber surrender his passport and any firearms throughout the process.

Alba granted Walz's request and also told Koerber to not travel outside of the state without pretrial services knowing about it and to not contact any potential witnesses in the case.

Koerber declined to comment after the hearing.

"We have received a lot of materials that we have to analyze," Mooney said while leaving the courtroom.

Koerber was indicted in May on mail fraud, wire fraud and tax evasion charges from the alleged Ponzi scheme, which prosecutors say went on from 2004 to 2008.

Koerber was involved with several businesses in Utah, including Founders Capital, Franklin Squires Investments and Franklin Squires Cos. The indictment accuses Koerber of devising a scheme for obtaining money and property "by means of false and fraudulent pretenses, representations and promises."

The indictment accuses Koerber of using money to make bridge loans, with interest payments used as "Ponzi payments." At no time during the scheme, according to the indictment, did the Founders Capital or Franklin Squires entities make a profit.

Mooney said that the indictment didn't "tell us much" about the prosecution's case. He went on to say that when dealing with investments, "somebody always wants to blame someone else for their loss."

If convicted, Koerber faces up to 20 years in federal prison and a fine of $250,000 for each charge of mail fraud and wire fraud. Investigators say Koerber also owed more than $250,000 in federal taxes. The maximum penalty for tax evasion is up to five years in prison and a fine of $250,000.

Alba scheduled a status hearing in the case for Aug. 31.

E-Mail: ethomas@desnews.com