OCR Text |
Show marl Snow & The Penny Stoeli Tag Team St TZ'&tzzxm&zs rn MUSK BYU IROOSSOK KAI ( All H) KaKI in March, 1985 because Snow was of the community. If Snow said Strand was OK, then Kalt would buy stock. Snow said to go ahead, Kalt invested eventually loosing everything. This surprised Kalt, but it didn't surprise those who really knew Strand. You see, at the time Snow encouraged Kalt to invest, Strand, had only recently been released from prison and was still on probation for a felony. You guessed it stock fraud. Its situations like this that earn Utah the title of "Americas fraud Capitol." Operators use Bishops, Stake Presidents and other community leaders to lend credibility to reckless speculation and stock manipulation. And the trusting Mormon with an ingrained "Mormon Authority Reflex" is a sitting duck. Mike Strand is a master of such deals. One law enforcement source calls Strand "the most despicable man have ever met. You've heard that there is honor among thieves, but that does not apply to Mike Strand." Last week we revealed evidence of BYU Administrator and Congressional Candidate Karl Snow's business relationship with Mike Strand. It was noted that this writer initially came across the documents as a volunteer for Snow's opponent in the primary. Snow, we said, discounts the documents as forgeries. But we pointed out that the documents stem from various sources and are almost certainly genuine. Now Snow faces statements from others who witnessed his involvement. On Monday Snow Spokesman Clark Caras told us that Snow had never denied having any connections with Strand. But in fact, he has come very close. In the August 20 Deseret News, Snow said: "I never attended any board meeting of Global Oil. I never accepted any stock in that company, although it was offered. I havent seen Michael Strand in four years and have had nothing to do with his companies." Snow has made similar denials on many occasions. Witnesses, along with the documentary evidence SR, Oct. 3 1990), have now made Snow's denials untenable. And the fact that Snow has been less than honest is in itself now the issue that must concern the public. John Darger Pulling Strings John Darger says he UII I.I, trrt tfmr I rfm PlRlY LfnWM Snow was high and mighty. We felt we were not as important," says Gleason. Gleason invested heavily, ultimately losing around $1 18,000. He also got friends including Percy Kalt to invest. The credibility borrowed from Snow and Smart was critical for all the investors, Gleason says: "Without their involvement, we never would have gotten involved. Their credibility swept us along." Strand knew he lacked credibility, Gleason says. "Strand was a blasphemer, and hedidn't have credibility. But he would tell us that he had all these prominent guys 'in his pocket.' They were there to establish his cred- meetings he and Snow both attended are nearly comic: "Lie Strand put people down. They would all defer to him. He would march around the room, scribbling figures on the board, swearing, gesticulating." Strand would sometimes even stand on his chair to emphasize a point. Percy Halt The Perfect Target "I never would have trusted Strand," says Percy Kalt of Provo. To see him is not to trust him. But he told me about Karl Snow, Lyman Smart, and others." Kalt went to Snow for advice: "When I asked Snow about the company, he told me he was a major stock holder and a member of the board, and he said it was a good investment." Kalt is a musician, a novice in the world of stocks, and the perfect target for this kind of scam. Kalt was initially contacted about this investment by Herb Gleason. At the time, Kalt had children on LDS missions and was struggling financially, so he considered the investment seriously even though he would have to borrow the money. Kalt recalls, "I went to the Boston Building in Salt Lake to visit Mike Strand, who told me that if I paid could sell them in less $25,000 for 7,000 shares, than thirty days for three times their present value." Strand told Kalt that if he had any questions to talk to Karl Snow." 1 uStrand was a blasphemer, and he didn't have credibility. But he would tell us that he had attended many meetings with Snow and Strand. Strand's interactions with Snow were frequent, Darger says. One scene in particular is vivid in his memory both because it was so striking and because it occurred more than once. Strand would insist that Snow do something, and Snow would decline. "You are f ing going! to do it," Strand would bellow, pounding his fist on the table. Invariably, Snow would give in. "What Strand would say, Karl would do," Darger says. Darger says, "when Strand first got involved, he told us that he had political connections who had pulled strings to get him out of prison." Strand also told Darger they needed someone with "influence" who could get things done. Darger says Strand told him, 'I want Karl Snow to be involved.' So he invited Snow down one day, and that was the first time met him." Darger sat in on various phone conversations between Strand and Snow. Some of these concerned stock prices. Darger says he remembers clearly that one "concerned the price of stock, that the stock needed some support in the market. I remember Strand telling him he was sure hed make money." have six Jaguars, Strand diately distanced himself from the would say as he lit a new fair. "Don't get me involved with this. cigarette from an old one, have nothing to do it," Snow said. uyour $25,000 means nothing with Kalt's investment was total loss: to me. " Percy Kalt $25,000 plus interest on the loan. ul ibility." Strand's antics at the Snow Says Go Kalt con- tinues, "I told Mr. Snow that had been referred to him by I Mike Strand on an investment proposal, and I understood that he could shed some more light on this. Snow said that, yes, he was a major stock holder. I told Mr. Snow that I would have to borrow the money, that this came at a difficult time when I had kids on missions and in college, and I didnt want to do anything that would put my meager finances in jeopardy. He assured me that this was a good thing. He also told me that he was a member of the board. "I also asked Mr. Snow about what Mr. Strand had said about his release from prison that it had been facilitated by Snow and that Snow felt that the IRS had put him in there unjustly. Snow confirmed this and said that Strand's conviction was a 'travesty.' Snow told Kalt that Strand's conviction was an IRS problem, but Strand had actually been convicted for securities fraud and was still on probation. "1 came away with the definite feeling that I should do it, since he said he was a major stock holder. He said he had bought some stock and that he had received some for services he had performed. He mentioned a figure of around 100,000 shares. I remember feeling that this was certainly a lot of stock, compared to my 7,000 shares, and thats why I remember the numbers distinctly." Based on Snow's assurances, Kalt invested. Mrs. Kalt recalls her strong objections, noting that her husband repeatedly tried to reassure her by referring to those including Snow who were involved. all these prominent guys in his pocket. " Herb Gleason 1 Herbert Gleason An Illusion of Legitimacy Oh yes," says Herb Gleason, an investor who now lives in Lakeland, Florida, "It was clear Karl Snow was deeply involved from the beginning. We met Snow, Lyman Smart, and otherswe met them all." (Lyman Smart, a bank officer, died under mysterious circumstances months after these events took place.) In the Spring of 1985, Gleason attended several of Strand's meetings in which Karl Snow participated. Gleason says Snow frequently went in and out of an adjacent office to make phone calls. "Snow's name wasn't on the door, but we knew that it was his space. Anatomy of a Scam 26, 1985. After an taded to Strand mysteriously began to rise. (This should give the novice a sense for how stock manipulation works.) Now when Kalt talked with Strand he was treated disdainfully. '"1 have six Jaguars, Strand said as he lit a new cigarette from an old one, 'your $25,000 means nothing to me.'" This was the man with whom Kalt invested based on Snow's character reference. Kalt now asked Snow for an explanation, but Snow immeaf- I a Financially ruined, at his wits end, and stifled in his attempts to seek justice, Kalt took matters into his own hands. He d Strands house. The events which followed can, in light of the above, be viewed with a significant degree of sympathy. Kalt, who had been a respected professor at BYU, now found himself in legal difficulty, out of work, and struggling to put bread on the table. Today, he lives in the basement of his own home, the main part of which he rents out to help cover his debts. Your Old Friend Kart In August of this year, Kalt returned from vacation and found a message from one of Snow's aides on his answering machine. "We know you've been leaking information about Snows relationship with Strand to the media, the voice said, "and we wondered why you would do such a thing." Kalt called Snow to tell him that he had been on vacation and knew nothing. "I'm glad to hear that," Snow replied. This was not the only attempt to intimidate Kalt. On September 27, after reading a draft of this writer's first article, Karl Snow again called his old friend Percy Kalt. Kalt describes the call: "This call lasted over an hour. He tried to justify himself tome, and tried to plant thoughts in my mind as to what I should remember about the affair." Snow said he had not told Kalt of having 100,000 shares of Global stock, but that it was actually 100,000 shares in another Strand outfit. Kalt says Snow "also denied having been an officer in the company and denied having helped Mike Strand out of prison. Twenty minutes later, it came up again, and I said, 'Mike Strand gave me your name and said that you had helped him get out of prison when the IRS had put him there.' Snow said 'Yes, thats true. Charitably, Kalt did not point out the contradiction. Kalt says Snow then said that he "would like me to sign an affidavit that he had not influenced me to invest and that he had not said that he was involved. He said that he would have someone contact me. The next day, Kalt decided to go public. Kalt wrote out a check on April initial gain, Kalts stock began a the while, Strand assured Kalt that steady decline. All it would turn around. Finally, when his stock was next to worthless, Kalt approached Strand again. This time, Strand offered to transfer his stock to another company, Atlantic Mining Inc. Kalt agreed, and then watched this stock collapse. Meanwhile, the stock he had just Notes 1) The statements of Darger, Kalt, and Gleason are plausible and consistent with each other and with evidence in court files. 2) To say that Snow was "used" is defense. What if he was "used? If he succumbs to Strand, how will he handle the ethical complexity of Washington? If he was a pawn, then he is easily manipulated and is a poor judge of character. 3) Caras asked us why no one has pointed these things out before. FJere's why: To speak of a mans wrongdoings is normally gossip. But someday the priest may say, "If anyone knows a reason why this couple should not be wedded, let them speak now or forever hold their peace." At that moment, what was gossip becomes a civic duty. It is for such a reason that no one brought this information out before and why they do so now. 4) An attorney and a CPA are looking into the records. Flope for the best, but expect the worst. Expect a whitewash. Expect them to answer questions that weren't asked. Questions like: Is there evidence of any specific illegality? Ethics extend beyond legality. d 5) Perhaps Snows arrogance to date rests on confidence that the public and press will continue to handle him with the kid gloves his has enjoyed until now. If he gets away with it, it will be a sad reflection on Utah. A well-founde- The original version of this arth le appeared in 10, I WO. Student Review, Oitoher the product of Utahns For Ethical Government , a Independent, citizen group. UEG hopes the voters will seriously consider their selection at the polls November 6th. We Invite your comments and questions. Write UEG, P.0. Box 66, Provo, UT 84603 This publication Is non-partisa- n, |