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William J. Ulrich- Security Rare Coin and Bullion Corp Page 1 of 3
<br /> FTC CHARGES MINNESOTA LAW FIRM A\D B:�\I:WITH COtiSPIRItiG TO
<br /> DEFRAI�D 7'HE AGENCY Ol1T OF AN�11 MILLION JI�DGME�T I\(�O1�
<br /> FRAI�D CASE- 12/92
<br /> The Federal Trade Commission has charged a Minnesota law firm and a Minneapolis bank
<br /> in federal district court with fraudulently agreeing to prevent the agency from collecting on
<br /> an$I 1.2 million federal court judgment The FTC had won thejudgment for consumer
<br /> redress in a previous case against a raze-coin marketer.Named in today's case are Larkin,
<br /> Hoffman,Daly&Lindgren,Ltd.,of Bloomington;and the\ational City Bank,of
<br /> Minneapolis.
<br /> According to the FTC,the defendants helped the coin marketer fraudulently transfer
<br /> several million dollars in rare coins into trusts for his three daughters and then convert a
<br /> substantial portion of the coins back to his own use,and that they unlawfully and
<br /> wrongfully acted to conceal assets belonging to the coin marketer and to put those assets
<br /> beyond the reach ofthe FTC.
<br /> In its complaint detailing the allegations,the FTC is seeking to void all illegal transfers of
<br /> money made to the defendants,pursuant to federal and state law;compensatory damages
<br /> against the defendants for aiding and abetting,conspiracy,and,as[o National City Bank,
<br /> breach of fiduciar} duty;and,according to[he complaint,an award for punitive damages
<br /> notto exceed$1 I.2 million.
<br /> This case stems from the FTCs 1986 case against Minneapolis coin dealer Wiliiam J.
<br /> L`Irich and his firm,Security Rare Coin& Bullion( �rrpuratiun,a leading nationwide
<br /> seller of coins for in�estmen�that was based in Minneapolis.The FTC filed its suit against
<br /> Ulrich and his firm on Dec.29, 1986,and sought consumer redress in excess of$20
<br /> million.
<br /> According to the complaint filed late yesterday,FTC stat�began investigating Ulrich in the
<br /> summer of 1986,and came to believe that he was selling his coins for three to four times
<br /> their true value while representing that they were low-risk,high-profit investments sold at
<br /> or near their market value.
<br /> During the fall of 1986 and the winter of 1987,the complaint states,Ulrich's auurn���,and
<br /> the bank knew that his"potential liabiliry in the FTC matter could equal tens of millions of
<br /> dollars."Yet,beginning in the fall of 1986 and continuing until May of last year,according
<br /> to the complaint,Ulrich conspired with,and was aided and abetted by,the law firm and the
<br /> bank"in an unlawful plan to remove,conceal,and protect�his assets from the reach of the
<br /> FTC."
<br /> This allegedly was accomplished through a series of fraudulent conveyances and other
<br /> unlawful transactions,which succeeded in making Ulrich virtually judgment proof,the
<br /> FTC charged.
<br /> According to the complaint,in the fall of 1986,Ulrich,with the assistance of the Larkin,
<br /> Hoffinan firm,allegedly attempted to place a substantial amount of his rare-coin holdings
<br /> into three identical trusts the firm had helped him set up for his daughters in 1985.
<br /> The complaint states that an attorney at Larkin,Hoffinan,worked with Ulrich to devise a
<br /> plan--which included backdating documents and altering them to remove creation-date
<br /> codes--to make it appear as if the coin holdings had been placed in the trusts prior to
<br /> Ulrich's knowledge of the FTC investigation.(Had this been the case,the FTC could not
<br /> have reached the trust-account holdings in its suit for consumer redress.)
<br /> Later,according to the complaint,an attorney at Lazkin,Hoffinan made numerous false
<br /> statements during a deposition and misled the court in an attidavit about when he believed
<br /> the gifts to the trust actually had been made.
<br /> Further,the complaint states,the National Ciry Bank of Minneapolis allegedly accepted a
<br /> position in April 1987 as corporate trustee of Ulrich's trusts despite the objection of several
<br /> bank�mple��c��who were concerned about Ulrich's legal problems and possible unlawful
<br /> motives for using the bank as trustee.
<br /> The"gifted"coins then were physically transferred to the National City Bank's vault.Then,
<br /> the FTC eharged,National City Bank and Ulrich agreed not to liquidate the coins,as
<br /> required by state law and federal banking regulations.
<br /> From June 1989 until April 1991,the FTC alleged,National City Bank substantially
<br /> assisted Ulrich in a scl�eme to shield assets from the FTC by giving him free rein to control
<br /> and liquidate the trust assets as he chose,in viola[ion of the bank's legal responsibilities.
<br /> The FTC alleged that the bank appointed Ulrich as its agent to liquidate the coins and
<br /> http://www.crimes-of-persuasion.com/players/ulrich_william.htm 12/5/2008
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