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‘Free Capitalist’ Rick Koerber sentenced to 14 years in prison after wild court hearing

Posted at 4:23 PM, Oct 15, 2019
and last updated 2019-10-15 23:56:47-04

SALT LAKE CITY -- The "Free Capitalist" Rick Koerber is free no more.

Koerber, who gained fame across Utah for his real-estate investment seminars and was ultimately convicted in what prosecutors claimed was one of Utah's largest Ponzi schemes, has been sentenced to 14 years in prison.

A federal judge said he "preyed on his fellow Mormons" and sentenced him for a scheme that prosecutors claimed bilked dozens of victims out of $100 million. It was a wild hearing with the judge being heckled by some in the crowded courtroom of supporters and a man being dragged out by U.S. Marshals.

"We love you Rick!" some shouted as he was led away.

"I know you're using the money to restore the Constitution," another man shouted.

Koerber's sentencing brought a large crowd, including a group led by Ammon Bundy. They gathered outside the federal courthouse to decry the prosecution of Koerber as "politically motivated." Bundy and Koerber became friends during Bundy's trial for a 2016 standoff in Oregon (Koerber did work for the defense and they shared the same defense attorney in their respective cases).

"He did not have a Ponzi scheme and he did not intentionally take money from people," said Bundy. "If he did, it was only through the housing crash."

Speaking to the judge, Koerber insisted it was not a scam. He acknowledged making some bad business decisions.

"When I started this business, I had a certain perspective. Ten years later, it’s 14 years later now, I have a lot different perspective now," Koerber said. "My original idea was not to prey on Mormons or anyone. My original idea was to make a difference."

To those in the courtroom, Koerber was not a fraudster. When the judge asked to hear from victims, they lined up to say they were not victims. It angered the judge, who cut them off and told them to sit down.

"I am a victim of these fraudulent prosecutors," a man said.

Judge Frederic Block cut him off.

"You say you're a victim. How much money?" the judge asked.

"About $3 million," the man replied.

The man refused to leave the podium, prompting U.S. Marshals to drag him out of the courtroom as people shouted from the audience.

"This is bull---!" one shouted.

Outside court, some Koerber supporters who said they lost millions insisted they were not defrauded.

"Nobody put a gun to my head," said Mary Colovich, who alongside her husband, Brad, who are serving a Latter-day Saint mission, attended Koerber's sentencing. "We are not stupid Mormons as was portrayed in the courtroom. We made an intelligent decision. Did we make mistakes? Absolutely. We learned from them. We’re better people. It’s just a shame. It really is."

It's taken federal prosecutors more than a decade to get Koerber sentenced. He was convicted by a jury last year in prosecutors' third attempt to try him. He was accused in what prosecutors claimed was one of the largest fraud schemes in state history, originally exceeding $100 million (in recent court documents, prosecutors downgraded it to $45 million losses).

"It was widespread. Bankruptcies, home foreclosures, loss of health, loss of marriages," said assistant U.S. Attorney Tyler Murray.

Koerber, who was known for his "Free Capitalist" billboards promoting real-estate investment seminars, TV appearances and radio ads, was charged in what prosecutors alleged was a $100 million Ponzi scheme. He was accused of spending investors' money on real estate, living expenses, a pair of Ferraris and even funding a horror film called "Evil Angel," in addition to paying interest to other investors.

The Utah Attorney General's Office declined the case. The feds picked it up and it was originally thrown out over accusations of prosecutor misconduct. An appeals court reinstated it. The second prosecution resulted in a mistrial. The third trial resulted in a guilty verdict by a jury.

Koerber's attorney, Kathy Nester, told FOX 13 outside court she intended to appeal his sentence. Federal prosecutors expected the case would continue.

"Mr. Koerber committed the crimes for which he was convicted. The evidence was strong, the judge noted that, the jury definitely noted that and we feel justice was done," Murray said.