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Riverdale couple accused of Ponzi scheme surrenders
Deseret News (Salt Lake City), Dec 10, 2006
A Riverdale couple who authorities say were the Utah arm of a $230 million Ponzi scheme surrendered in Ogden's 2nd District Court on multiple felony charges.
Kerry D. Pipkin, 47, and Laurie Ann Pipkin, 38, appeared before Judge Ernie Jones Wednesday on charges of securities fraud and theft, both second-degree felonies, and allegations of being unregistered securities agents and sale of unregistered securities, both third-degree felonies.
A probable-cause affidavit filed by the Attorney General's Office alleges the Pipkins, through their business Executive Assets, recruited investors to sink money into the California-based company dealing in accounts receivables for latex glove manufacturers in Asia.
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They failed to tell their investors -- which included a cousin of Laurie Pipkin -- that the Securities and Exchange Commission had frozen the assets of the California company in 2002, documents say. That action was taken by authorities after it was deemed that the company was not "purchasing accounts receivables from any latex glove manufacturer; it was running a large Ponzi scheme," according to documents.
From 1999 through January 2002, more than $230 million reportedly was raised in the scheme. Of that amount, documents say, in excess of $100 million was used to pay other investors to "create the illusion" there was a receivables business. By the time the promissory note issued to the cousin became due, the Pipkins advised investors that they had decided to withdraw all their funds from the program, citing the "political environment between China and the U.S. and the rest of the world."
By then, two years had passed and the cousin never received the money due for the last note
Authorities allege Kerry Pipkin funneled the money through two of his other companies, Crazy Cash and Crazy Money, and that the funds eventually paid credit card bills, mortgage and child-support payments.
Their next court appearance is Jan. 3.
Copyright C 2006 Deseret News Publishing Co.
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