OCR Text |
Show rand Jury Indicts Four By JOSEPHINE ZIMMERMAN Herald Staff Writer A Federal Grand Jury Tuesday indicted 21 individuals, including four Utah County residents, in one of the nation's largest investment swindles and the most intensive fraud investigation ever conducted by the FBI. Independent Clearinghouse, Universal Clearinghouse and three other trusts were named in the indictments as reportedly involving more than 3,800 people, 1,754 in Utah. Victims lost $15.6 million in 1980-8the one year audited completely by the FBI. More than $32 million was involved during the period, according to an FBI report. Individual investments ranged 1, from the minimum $1,000 10 $500,000. Brent D. Ward, U.S. Attorney for Utah, said 18 of the 21 are in custody in Utah, California, Colorado and Michigan on criminal charges related to five different trusts and entities, including Independent Clearinghouse, Universal Clearinghouse, Accounting Services Company, Business Consultants and Payable Ac- counting Company. The three not apprehended in the FBI roundup Tuesday or already in custody include two Utah County men the FBI is listing as fugitives. They are Kenyon V. Blackmore and Barry Crowther, both residents of Salem. County Men Ulfeoh Other county residents in custody are Grant Roylance and Joseph Wayne Haws, both of Prove The FBI said Roylance was already in federal custody on another charge and Haws was remanded to the U.S. Magistrate, who set bond at $20,000 pending entry of a plea. Haws and Roylance are charged with collection of extensions of credit by extortionate means, aiding and abetting, involving $750,000. Blackmore faces 20 counts, including two counts of Racke teer Influenced and Corrupt (RICO) violations, Or17 ganization counis of Interstate Transportation of Money Obtained by Fraud (ITMOF), one count of collection of extension of credit by extortionate means, aiding and abetting. Crowther also faces 20 counts, including two counts of counts of ITMOF, one lmail fraud, and one collection of extension by extortionate means, ing and abetting. RICO, 18 count of count of of credit and aid- set at $10,000. Ward described the indictments as involving a "Ponzi-type- " scheme in which funds of victims were illegally diverted to purchase gold and silver coins, mining investments, automobiles, precious metals, trading commodities, oil leases, homes and real estate. In one case, Ward said, funds are alleged to have been utilized to post $80,000 bail. The indictments specify funds (Continued on Page 3.) Fraud Investigation Was Huge Operation The five indictments returned Tuesday are the result of the largest fraud investigations ever conducted by the FBI: 3,800 victims in 38 states and eight foreign countries. Losses totaling $15.6 million for a period audited in 1980-8-1. Indictments handed down against 21 individuals, with 18 in custody in Utah, Colorado, Michigan and California. 1,754 victims in Utah alone. Culminates a investigation by FBI, U.S. Postal Inspectors and U.S. Attorneys Office. th ri; a wrraimiirriiinr-'----- President Says Hell Stand Firm On x84 Budget - PresiWASHINGTON (UPI) dent Reagan, despite the rough road faced by his proposed budget, is rejecting pleas to compromise and vows to veto any bill that would raise taxes, increase domestic spending programs or reduce his defense buildup. "It is time to draw the line and stand up for the people," he said Tuesday in a nationally broadcast news conference. Reagan ruled out compromise even with his Republican-dominate-d Senate. continue raising their taxes, spending more on wasteful programs or weakening our defense. They sent us here to stop that, and that's what we're going to do." Touching on the Middle East, the president said he hopes Syrian troops will withdraw from Leba-non once other outside forces are pulled out. He noted that Lebanon had invited the Syrian forces in and now they have "invited them out" in e the aftermath of the Israeli-Lebanes- withdrawal agreement signed Tuesday. Resisting the appeals of GOP leaders, Reagan has refused to yield from his insistence the 1984 budget should increase defense Provo replacing City's utility billings a system which utility employees and city officials say was in total may cost as much as disarray A new computer to handle $320,000. The city already has spent $173,-38- 5 for the switch, and the purchase of a larger computer to replace one bought last year, if approved, will push the bill to at least $290,000. The total cost of the change may be as high as $320,000, including the cost of training personnel and adjusting the programs, according to Farrin West, Provo's data processing manager. Provo Power Board members were told Tuesday that the city was losing unknown amounts of money because the old computer system was underbilling, incorrectly billing, or not billing at all many of the city's 23,000 utility customers. "It got so bad that we couldn't even open or close an account," said Jackie Findlay, a computer operator for the city who spoke to the Power Board. The only major problem that still remains, according to West, is that the computer currently in use is too small. West has proposed to the Power Board and Mayor James Ferguson that tht city trade In the small computer for a larger one, at a $6.00 A MONTH - PRICE 25 CENTS "- adamant against comprotaxes or spending legislation, Reagan said he was gratified at the bipartisan approval of the While on mise ar Jt ' MX missile in the congres- sional appropriations committees. , The president was meeting with yet another group of lawmakers today to press for approval of the MX which he told reporters will "strengthen our national security, reduce the risk of war" and improve the U.S. stance in arms control negotiations, down further." Also in the press conference, Reagan criticized the Nicaraguan government. "If they'll just start minding their own business, they can get along with the rest of us," he said of Nicaragua's Sandinista government. He accused Nicaragua of d trying to overthrow the government of El Salvador. Reagan also said he pardoned Watergate burglar Eugenio Martinez last week because "he was not in any way a ringleader or activist. He served his sentence. Since then he has led a model life. Those are the terms for pardon." duly-electe- Provo Computer Costs Skyrocket By ROGER D. PLOTHOW Herald Staff Writer 1983 spending at least 7.5 percent and raise only about $2.6 billion in new taxes. He originally wanted a full 10 percent military increase. The GOP-ie- d Senate Budget Committee Tuesday allied with Democrats to start writing a new bipartisan plan, but Republican leader Howard Baker said the possibility is "still real" there will be no budget resolution at all. Reagan was unimpressed, saying there was more at stake than a budget resolution, the whole economic recovery depends on his stance. "I will not support a budget resolution that raises taxes while we are coming out of a recession," said Reagan, running afoul of some Senate Republicans who have rejected his proposals and called for tax hikes to cut into soaring deficits. "I will veto any tax bill that would do this," he declared. "And I will veto spending bills that would rekindle the fires' of inflation and high interest rates," he said. "The American people 'didn't send us to Washington to PROVO, UTAH, WEDNESDAY, MAY 18, 109TH YEAR, NO. 248 cost of $120,000. He says the utilities trouble began when private consultants working for the city on contract began changing the programs in hopes of decreasing the time needed to collect utility bills. Only a small number of people were familiar with the lengthy programs that had been written for the city's IBM computer, which forced the city to rely on outside help when problems in the programs occurred, he said. "There were people that hadn't been billed in the city in months," West told the citizen board. West then transferred billings to a new computer, which he says has been an experimental prototype. Since the change six months ago, city data processing employ- ees and private programmers have been working to make the new computer program fit the needs of the utility department. Most of the problems have been worked out, according to West, but the computer itself isn't big enough to do everything the city would like. West hopes to convince the mayor to purchase the larger computer. Ferguson had hoped to complete an analysis of Provo's computers before buying any more, but he told the city council Tuesday night that the city may have to purchase the new utility computer before that survey is completed. z, jam&z- - mm. . Dennis Pattcnoa Fbotot Thistle Lake Flowing Through Spillway At 8:02 a.m. this mont'ng the biggest question of the day was answered when water from Thistle Lake began rushing through the spillway tunnel.A bet among workers at the site was also settled at the same time and one of them was $185 richer. Bets began being made on Sunday as to when it was believed the water would come through the tunnel.For $5 each, workers could guess as to the day and time. A beachball was placed in the mouth of the tunnel and was used as the measuring device. At 8:03 a.m. the beachball followed the water out. Saturday the water was nine feet below the mouth of the spillway. Monday morning the water was three feet below the spillway and this morning it rose high enough to begin draining the overflow off the top of the lake and prevent it from going over the dam. Orem Franchise Tax to Continue The council also agreed that a three percent pay hike for city By DAWN TRACY Herald Staff Writer Orem taxpayers will probably continue paying a three percent franchise tax on their utility bills and city employees may get a three percent raise. work session In a Tuesday night, the Orem City Council tentatively approved conr old frantinuation of the chise tax. City workers are now non-voti- is workers costing $120,000 more appropriate than spending $400,000 for employee raises, which was recommended in an earlier salary study. Orem Mayor Delance Squire said taxpayers will have difficulty accepting the salary survey because it was prepared by Orem workers. two-yea- preparing a final $20 million budget, assuming the council will approve the tax in a June public hearing. "I'm sure city employees did a good job," said Squire. "But taxpayers will have difficulty believing the study was impartial." Squire said an outside consultant firm should prepare the new study. Council also tentatively ap- spending $25,000 to fund another study to design a "sound salary plan" for city employees. proved Berlin told the council that during the last five years, four different salary plans have been implemented, which has caused confusion and low employee morale. He said whatever plan council adopts should be consistent. The council also tentatively approved retaining a three percent franchise tax levied on electricity, natural gas, telephone local serv ice, cable television and sewer and water. Two years ago, the council approved a five percent franchise tax to cover a $1.9 million budget shortfall. Last year council cut the franchise tax to three percent. Squire said he will vote to keep the franchise tax because most of it will be used for long-rang- e capital improvement projects rather than for general operating expenses. Councilwoman Stella Welsh said the franchise tax is more fair than property assessments because all Orem residents must pay, whether they own property or not. Provo Council Votes Sales Tax Increase By ROGER D. PLOTHOW Herald Staff Writer Joining most of Utah's cities, the Provo City Council voted Tuesday to adopt a 0.125 percent increase in the local sales tax, promising to drop property taxes at the same time. The adoption of the sales tax also means Provo will benefit from a state-wid-e redistribution of sales tax based on population rather than "Provo will benefit from the redistribution far more than many other cities," Mayor James Ferguson told the council. Ferguson says the sales tax increase will mean approximately $750,000 this year in additional revenue to Provo. He wants property taxes levied by the city to be decreased by .62 mills. point-of-sal- e. Cities lobbying the state legislature last winter agreed to drop their property taxes in exchange for a sales tax increase of percent. Ferguson says legislators didn't live up to the bargain, allowing only an increase of one-four- th one-eigh- th percent. so, we felt a moral obligation to try and decrease our "Even property taxes somewhat," Ferguson told the council two weeks ago during a discussion of the mayor's 1983-8- 4 budget proposal. Merrill Martin, council chairman, said he wants Provo's citizens to understand that the adoption of the sales tax option is more a tax shift than a tax increase. Council members have yet to review the mayor's proposed drop in property taxes, and may choose to increase or decrease it as part of the budget process. Wednesday: Islanders Stop Gretsky The New York Islanders didn't think EdWayne Gretzky, who is the greatest in NHL history, was all that tough. The Isles, who downed Gretzky's Oilers 2 to complete a sweep of the Stanley Cup playoff finals, held him to just four assists in the four games. Details of Tuesday's game appear on Page 6. monton's goal-scor- er 4-- Problems of Elderly Our society is too youth oriented. This is the conclusion of three BYU sociologists who are doing a study on the aging process of the LDS elderly. Dr. Evan T. Peterson believes there is a lot to be said for placing older people in positions of leadership, because they don't have families to deal with and can devote much more time to their assignments. series For the final report in the three-par- t on aging, see page 11 of the Today section. Rain Will Stop Today The forecast for Provo and central Utah calls for variable cloudiness through tonight with a chance of rain showers. The high temperature today should be near 60, with low temperatures tonight near 40. Thursday's high temperature will be in the mid 60s, and Thursday should bring fair to partly cloudy skies. Here's Where to Find It Amusements Arts Business Classified Ads Comics Crossword 17 n National-Internation- al a Opinions Sports Today Utah-Region- al 21 33.39 32 2$ 17 31 (--9 ...............1MI M 23 |