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Posted on: May 30, 2014

Maricopa County Attorney Initiates Civil RICO Action Against Sherman E. Unkefer III

PHOENIX – A Maricopa County Superior Court has appointed a Receiver to take custody of the assets of a convicted fraud artist who failed to pay up to $7.5 million in court ordered restitution to his victims. The action is the result of a recently unsealed civil complaint filed by the Maricopa County Attorney’s Office against Sherman E. Unkefer III (D.O.B. 9/21/1943), who was sentenced to ten years in prison in 1988 for defrauding hundreds of customers of his precious metals and currency business, North American Coin and Currency (NACC). According to the complaint, Unkefer conspired with others during his incarceration and after his release in 1996 to conceal millions of dollars in assets and avoid paying restitution to more than 1,300 victims.

“This defendant went to great lengths to hide his assets and create a sham of insolvency designed to prevent his victims and creditors from recovering their losses. But he has finally run out of tricks,” said Maricopa County Attorney Bill Montgomery. “We intend to vigorously pursue him and his co-conspirators to recover the funds his victims are entitled to and to impose an appropriate penalty for his efforts to evade his court ordered obligations,” he added.

The complaint, filed under the Arizona’s Racketeer Influenced and Corrupt Organization (RICO) statutes, estimates there are 1,334 victims who were injured by Unkefer’s actions, with losses totaling up to $17,948,380. The State is seeking treble damages of up to $53,845,140 against Unkefer and his co-conspirators. The Maricopa County Attorney’s Office has set up a special website to provide additional information for victims at www.maricopacountyattorney.org/unkefer.

From 1978 to 1982 Sherman E. Unkefer III was the CEO of NACC, which conducted a billion dollars of financial activity annually. Part of the company’s business model was to hold precious metals for its customers. In September 1982, the shareholders and directors of NACC discovered the company was insolvent and more than one million ounces of precious metals owned by its customers were missing from the firm’s secured storage facility. A subsequent investigation resulted in the conviction of Unkefer and an order to pay restitution to his victims.

The civil complaint alleges that during the period of time the trial court’s restitution order was in effect, Unkefer used a hidden cache of precious metals and coins believed to have been stolen from NACC to finance a lavish lifestyle that included expensive cars, jewelry, and travel. Along with co-conspirators, Unkefer created a series of shell corporations to conceal his financial assets from the victims he defrauded as well as from creditors and the IRS. He also sought to hide millions of dollars in income generated from several multi-level marketing and sales ventures he subsequently launched.

Sherman E. Unkefer III and one of his co-conspirators were served with the RICO complaint at their residence in Scottsdale, Arizona. More than a dozen related entities and individuals in the U.S. and abroad have also been served with the complaint. The court-appointed Receiver will take control of Mango Trust, the primary entity Unkefer created to conceal his accumulated wealth.

According to the complaint, Unkefer may also owe the IRS substantial sums for unpaid taxes, penalties and interest.

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