Adobe Stock
The owners of Rust Rare Coin, a well-known Utah rare coin business accused of running a $200 million silver trading scam, pleaded not guilty in federal court Thursday.

SALT LAKE CITY — The owners of a well-known Utah rare coin business accused of running a $200 million silver trading scam pleaded not guilty in federal court Thursday.

A federal grand jury returned a six-count indictment last month against Gaylen Dean Rust, 59, his wife, Denise Gunderson Rust, 59, both of Layton, and their son, Joshua Daniel Rust, 37, of Draper, in connection with an alleged Ponzi scheme.

All three are charged with wire fraud conspiracy and money laundering conspiracy. Gaylen Rust is also charged with two counts of securities fraud. Denise Rust and Joshua Rust are each charged with one count of money laundering.

All three — each with their own lawyer — entered not guilty pleas before U.S. Magistrate Judge Paul Warner.

Prosecutor Jacob Strain asked the judge to set an Aug. 22 trial date, but defense attorneys argued they couldn't be ready that soon.

"This is going to be a very complex case," said Wally Bugden, who represents Denise Rust.

The government did not seek to put the Rusts in jail pending the trial, but Warner set conditions for them to remain free from custody, including surrendering their passports and restricting their travel to the U.S. The judge also barred them from having contact with 800 victims and potential witnesses prosecutors have identified.

Last November, the Securities and Exchange Commission, Commodity Futures Trading Commission and Utah Division of Securities filed a civil complaint against the Rusts and their company, Rust Rare Coin. That case is on hold until the criminal case is resolved.

The government claims the company defrauded at least 500 investors nationwide of at least $200 million since 2008. The Rusts are accused of tricking people into believing they were pooling their money to buy and sell silver, but the funds were allegedly used to pay other investors.

Gaylen Rust owned and managed Rust Rare Coin Inc., R Legacy Entertainment LLC, R. Legacy Racing Inc., R Legacy Investments LLC, R Legacy Ranch, and Legacy Music Alliance. Denise Rust was listed as the secretary for Rust Rare Coin. Joshua Rust managed the coin shop from 2004 to November 15, 2018.

1 comment on this story

Gaylen Rust made generous donations to school music programs the Legacy Music Alliance. Some of the alleged fraud victims — inside and outside Utah — came to invest in the silver pool through their shared membership in The Church of Jesus Christ Latter-day Saints, according to investors who filed a lawsuit last year.

The indictment alleges that from 1996 and through Nov. 15, 2018, the Rusts conspired to defraud investors and potential investors in the silver trading program.

The Rusts failed to tell investors, among other things, that their money would be used for purposes other than to invest in silver and trading silver, according to the indictment.