clock menu more-arrow no yes

Filed under:

UTAH SCAM MAY HAVE DEADLY LEGACY

A Utah stock scam that bilked investors out of as much as $40 million in the mid-'80s appears to be the motive for a 1991 Florida murder as well as the December kidnapping of a Salt Lake businessman.

Daytona Beach police are interested in talking to Hong Kong millionaire John Wong about the murder after learning that Wong has been indicted for the kidnapping of Carl W. Martin.Wong and Martin are both tied to Richard D. Brown, a 51-year-old Florida man found murdered in his home Aug. 17, 1991, two days before he was scheduled to appear in federal court on charges stemming from the Utah scam, according to Daytona Beach police.

Martin and Brown ran the scam company called Goldcor. The two men bilked Wong of his $3.5 million investment in the company, according to a lawsuit Wong filed against the two men in 1989.

Brown was murdered on a Friday night. His father found him Saturday morning slumped in a chair with a bullet hole in the back of his head, said Daytona Beach police detective Tom Youngman.

In 48 hours, Brown would have appeared before a federal judge in Orlando, Fla., on criminal charges similar to those that sent Martin to a federal prison for several months, the detective said.

Youngman has long believed that Brown's murder was probably tied to Goldcor. The company, which originated in Utah, claimed it could turn sand into gold. "I even have a videotape of the process," Youngman said.

But the link to Goldcor hasn't helped him solve the case. "You look at Goldcor and there are so many possible suspects there," he said.

Bitter investors could be counted by the scores after the government busted Goldcor in 1988 and the company went broke.

Brown, Martin and a third partner breathed life into Goldcor in the early 1980s. Goldcor's parent company was a Utah company called Tarsand Petroleum Inc. The men obtained control of Tarsand, transferred it to Deleware and changed its name to Goldcor, according to court documents.

In 1985, Goldcor issued 1,050,000 shares of stock to Martin, his wife and children. Martin, his family and Brown controlled 51 percent of the company, according to court records.

The men opened Goldcor headquarters in Daytona Beach, rounded up dozens of investors and flew them by Learjet to Costa Rica for tours of the Goldcor plant there.

Investors visited a laboratory "where they watched as men in white coats purported to extract gold from the black volcanic sand of a Costa Rican beach using a secret chemical process developed by Goldcor," the Washington Post reported.

The investors poured millions of dollars into the scam, watching an initial $1 investment soar to $33 at Goldcor's peak, the newspaper reported.

By 1987, Goldcor had issued almost 40 million shares of unregistered stock, all in violation of federal law. The government caught on. The scam fell apart, and investors were left holding black sand.

The SEC filed charges against Martin and Brown, accusing the two men of squirreling away $13 million for themselves. Both men denied it.

But Daytona Beach police aren't buying their story. "We believe there is a lot of money in a Swiss account. Millions of dollars are missing that haven't been accounted for," Youngman said.

Wong believed there was money, too, according to a federal indictment. He hired a private investigator to research Martin's assets for a year before the kidnapping.

Goldcor records suggest Martin funneled the money to Brown, Utah attorney Mark Van Wagoner told the Washington Post. Van Wagoner represented Martin in the government's action.

Brown may have been prepared to testify about the location of the money, Youngman said. "He was prepared for the hearing. He was confident. But he never made it there."

Daytona Beach police want to interview Wong, Youngman said. Wong masterminded the kidnapping and hired six men - including his nephew - to commit the crime in a bid to get back his $3.5 million, according to a federal indictment. Martin was kidnapped Dec. 21 from his Holladay business and escaped from a Las Vegas hotel that night while his kidnappers were away.

Youngman said Wong is "somebody I haven't talked to yet, but I'd like to find out if he has any connection to this murder. It's interesting that he may have kidnapped Martin over the same thing."

Wong had nothing to do with Brown's murder, said Paul Rao, attorney for Wong.