This is a potted history of conman Wes Rhodes (C. Wesley Rhodes, Jr.)’s behavior to his old clients since the SEC dropped its bombshell in September 2006 and we, his old “friends” and clients, learned how he’d been duping us, robbing us and betraying our trust for anything from two weeks to twenty years. The story here is exactly as told on Cate Garrison’s blog www.lifeafterrhodes.blogspot.com in ten “episodes” with the general title, “Wes Rhodes, the post September 2006 history.” They are preceded by a short prologue giving a brief account of the years--though very much from a single perspective--that came before that unforgettable 2006 moment. References to pictures and illustrations refer to the blog itself. This is a layperson’s history, not a lawyer’s. Of necessity, it does not include every last detail. It attempts simply to paint a broad outline and present the big picture.

PROLOGUE (from blog post for May 25, 2008) I thought I'd use today and the next couple of days to try to give a bit of Wes Rhodes' history with us both before September 06, and after. Kind of like BC, and AD, but in this case BS (Before Shock, of course--what did you THINK?!) and ASS (After SEC Surprise). And obviously the pre-history bit is really personal to us (though I think it resonates with many). Wes Rhodes was a freakin' chameleon, let's face it. He changed his color to suit whoever he was conning at the time. So today, here's a potted history of what went before, largely for Henry and me (It felt like the truth at the time, but, like I say, it's all turned out to be BS). I've used that photo of our F.F. as a young chappie again, because that's how he looked when we met him, two decades ago (feels like two centuries, and another lifetime), when we were all relatively young, and, in our case, full of dreams for a long and happy retirement together (and in his? Was he already full of dreams of taking us for that long, slow ride--NOT in his Ferraris or his Corvettes?). It was taken towards the end of 1988, as I recall. So he was around 37 at the time (slightly younger than my eldest lad is now). Like I say, a lifetime. Anyway, here's my version of that BS time. Much of it reflects the thoughts in the essay (is that the right word?) I wrote right after we heard the news, and that I called "Conned." But there are differences too. So here we go:

Some dates will remain for ever ingrained on people’s consciousness. For Wes Rhodes’ old investors, September 2006 will always be remembered as the month the news broke that the man who’d claimed to be the faithful steward of our hard-earned savings and the guarantor of a reasonably comfortable retirement --even, in some cases, a personal friend--had been the subject of an SEC and an Oregon State investigation and, apparently, was nothing but a conman who’d squandered our money on muscle cars, collectibles and luxury living. Some of us had stuck with this guy for more than twenty years; others had handed over their life savings more recently. So far as I know, not one single one of us (at least none that I have had the privilege of meeting) was in the business of “getting rich quick,” or looking for improbably high returns. On the contrary. We seem to have been a fiscally conservative bunch who would have looked

askance at schemes that promised our money would be doubled overnight. I have learned the painful lesson in the past year that folks like us provide conmen able to practice their sly trade over the long haul with perfect targets because the relatively slow growth of our investments make us feel secure, whereas something more spectacular would inspire skepticism and suspicion.

There are two distinct parts to all our stories. First, there’s the time before September, 2006 (whether months, years or decades) where Wes Rhodes, our financial adviser, seemed to us to be a good guy, with a sensible investment strategy, who was genuinely looking after our welfare and seemed to care about us personally, with our hopes for retirement, and for our children and grandchildren. The more we learn, now, about the truth of the matter (the more we peel back the multilayered skins of the onion, as it were, and find a rotten core) the harder it is to remember and believe the trust we had. One of the problems, for me, of writing a daily blog, where Wes’s arrogance, selfishness, callousness and other despicable qualities are revealed day after day after day, is that it’s easy to lose sight of the fact that, during all the time we worked with him, until the SEC bombshell dropped, he appeared “genuine.” We didn't like everything about him, but we didn't once think he was robbing us. Probably now, with hindsight, (I speak for myself) we feel a little ashamed that we didn’t see through him; we kick ourselves for every tiny misgiving we may have felt and failed to act on, forgetting that everyone feels misgivings from time to time, I suspect, even with bona fide, honest business partners, advisers, spouses--probably even hairdressers, doctors and dentists--who by and large are on the up and up. I’ve talked a lot in this blog about the means he used to con us--the personae he adopted, the various claims he made (opera singer, NASCAR driver, ex marine officer and Vietnam vet, wrestler, football player, graduate with five degrees, engineer, among many, many others). But he also was, quite genuinely, for many or most of the years we knew him, a registered investment adviser with the State of Oregon and the SEC. He certainly was licensed when we first met him and, of course, checked him out (he’d obtained his license in March, 1988). We assumed, and weren’t told anything to the contrary, that he’d continued to hold such a license for the rest of our business relationship, though we discovered, after the fact, that he’d not had one for the period between 1994 and 1998, and then had briefly lost it again as the result of a complaint culminating in a Cease and Desist Order around 1999/2000, when he’d also been fined for breaking rules; we gather that he had then jumped through the various required hoops to be reinstated (and of course, we, his clients, knew nothing about that particular episode either--and I’d defy almost any lay person, especially at the time, to have known where to look on the internet to find the Forms ADV parts one and two on the SEC and/or state websites that inform folks of such things; lord knows, it’s hard enough now). He apparently then kept his license until 2006/2007, when it was permanently revoked in a new and more terminal Cease and Desist, which he did not contest. I’ve uploaded that .pdf file onto Scribd with some of the other documents accessible there (I've entitled it

Rhodes Consensual Cease and Desist Order 2006/2007). It makes interesting reading.

In addition, he was a member of various boards (the ballet, at least one school, among other enterprises) around the city, a “financial broadcaster” on a radio channel (we learned later that he paid the station, rather than the other way round, as we had understood). He’d been, in his own words, a “statutory employee” of a couple of highly reputable, big, known companies. He’d written regular columns in the Multnomah County Medical Society’s newspaper, The Scribe. He’d given talks and seminars about investing; he published an investment advisory newsletter called Art and Aim which appeared to talk the talk. He was on economic advisory boards (we discovered only after the fact that this was no particular honor). He’d worked with local hospitals, and schools, and had references from reputable folks (even ourselves, alas, at one time). He appeared to give to charity in a way that we found admirable. Above all, the advice he gave to most of us was safe, long-term, cautious stuff, about knowing our aversion to risk, about saving for the future. His degrees (which turned out not to exist) appeared to be from Portland State, which seemed reasonable, whereas five degrees from Harvard might have caused us to research his claims. He was an alumnus of Sunset High School. There seemed nothing untoward in any of it. Over the two decades that my husband and I knew him, he seemed to grow his own wealth successfully. We didn’t think it particularly odd that his wealth expansion seemed greater than ours; we knew he had businesses other than his financial companies--he was invested in veterinary clinics and other enterprises at various times--Doll Houses, Roller blading equipment or some such, at one point even a Christmas Tree farm, whereas we were pretty cautious, just working, saving and investing mostly in 'bonds,' ha, ha). He worked really hard for us in the early days (or appeared to), sorting out my husband’s rather chaotic finances, researching old real estate investments with a fine tooth comb (and with the production of “books” with details and photographs of each property). And though some folks from day one found him oily and pretentious, with his funny bow ties, his baseball cap, his driving gloves, and his propensity to burst into (tuneful) song, I admit now (and yes, again, with some after-the-fact shame) that by and large I thought him quirky, interesting, more colorful than other stony faced, boring advisers I’d interviewed, and therefore more suitable for and suited to our personalities. Oh, how I long for those boring folks now! But at that time? What was there not to trust?

For my husband and myself, I think we felt that after Henry had retired (or thought he had retired) around 2002, Wes began to neglect us slightly. In part, we felt this was because we’d moved to Central Oregon, so we were genuinely out of touch. (We realize now that he was starting to scuttle around and move money from account to account to cover his traces; he was busily hooking richer fish; he probably felt that we were all “fished out.”). Besides, his quasi-withdrawal wasn’t entirely unwelcome. He’d become a bit over-glossy for our liking, with brochures, and "matrices" and various types of high

falutin' portfolios and funds. We were getting older and had a natural disinclination for overt showiness. Though we’d both driven Porsches in the past, we were settling into, not Oldsmobiles, but certainly hybrids. So although we knew that Wes had a couple of hobbyist Corvettes, we didn’t suspect he owned over forty muscle cars, housed in a museum, along with collectibles and memorabilia of every kind imaginable, from Beatles posters to Native American artifacts to a whole row of ancient parking meters. And we were never invited to his famous Crossed Flags Farm. As far as we were concerned, our investments, some in stocks, but mostly in bonds, were bubbling along in okay fashion. From time to time, especially when some particularly “financial-speaky” new brochure arrived with our statements, we wondered if we should move on. But we’d been with him for so long, we didn’t like to hurt his feelings unnecessarily. Besides, we didn’t really feel we had anything to complain about. He seemed, if not better, then at least as good as anyone else might be.

Other folks, who had stayed more closely with him, or had come upon him more recently, must have been really impressed, we are sure (as we no doubt would have been) by what looked very much like real worldly success. A couple of Ferraris bought, he claimed, from the profits of a single trade. Talk of big accounts with large and reputable companies. Tears shed after 9/11 because of his “colleagues” at Cantor Fitzgerald who had perished, along with the “business plans” he claimed he’d drawn up for them, at their request, and the $800,000’s worth of business he asserted that ill-starred firm put his way each year. He claimed similarly large dealings with Tektronix and others; his father had worked there after all, and was (and still probably is) a recognized genius who’d invented certain TV components that apparently still pertain today. Again, what reason was there to doubt?

As to due diligence? The bulk of his clients were savvy business people who knew the right questions, and asked them. Once again, Wes was a bona fide, registered investment adviser, and I’m sure his customers knew how to check that out. They included CPAs and other financial planners, presidents and vice-presidents of enterprises of all kinds, attorneys, bank employees. He provided them with facts, figures, all kinds of details. He came with solid references and recommendations. He contributed to political campaigns, was an active (and loud) church member, a resonant voice in the business communities of Tualatin and West Linn, where he lived.

For us, again, admittedly, we had for some time probably contented ourselves with rather more generalized statements than we should have, concerning what we thought were “mutual fund” type investments predominantly in bonds (as opposed to the detailed listings we received for our stock holdings through Schwab or Fidelity or other large houses). But, to be honest, that didn't appear untoward; most statements of “mutual fund” type holdings ARE vague, by necessity. I accept that I have X amounts of dollars

in a Wells Fargo Savings account, for example, without knowing at any given moment exactly where those dollars are held. People who have mocked me and others as idiots who didn’t manage our own money carefully say we should have been, for example, with Vanguard. And they may well be right (well, with hindsight, of course we wish we had been! Duh!). We’ve moved some of the little we have left into Vanguard now. But my online Vanguard statements don’t tell me anything more than Wes Rhodes’ statements did; apparently we are 100% into municipal bonds. Great. But do I know what that means exactly? Of course I don’t. Whereas for the first 8 years or so of our relationship, Wes Rhodes would sit with me for hours on end at my kitchen table explaining the tiny minutiae of every last transaction he claimed he’d made in the previous quarter. Was he lying? Probably. Could I have known? Not at all. Did he show us lists from time to time of where these mutual fund “bonds” lay? For sure. And after eight years or so, we probably told him it would be okay, now and then, to mail the statements to us as we trusted him. Were we wrong to do so? Evidently. But would it have made any difference? Probably not.

So what have we learned? I can only speak for my husband and myself. Every one of Wes Rhodes’ clients will have a slightly different tale to tell, and a different lesson learned. For us, we’re still trying to work the whole thing out. Clearly we suppose we should have been even more vigilant than we were, even after the first decade of what felt like extreme vigilance. We should never have allowed a financial adviser to become a “friend,” even remotely (I think perhaps you should never have a financial adviser or a doctor or a dentist or anyone who supplies services of any kind that you feel reluctant to get mad with, and sack, even if it’s just because you don’t like his glossy brochures). We wish we’d had the list of SEC’s questions to ask an adviser twenty years ago, though we doubt whether, at that time, it even existed. We’d add a few more of our own, now, but they’d be specific to Wes Rhodes (Does your adviser own more than 40 cars? Does he sigh heavily when you want to take money out of his “managed” funds? Does he suffer from bronchitis or other possibly psychosomatic illnesses during periods of stress? Does his letterhead include a quotation from Nietzsche? Does he blind you with science, or use gobbledygook when explaining strategies? Does he seem--oh, I don’t know--just a little superior or condescending when you ask him a financial question?). And the problem with questions such as those (which clearly aren’t universal), is that a relationship with another conman could provide totally different ones, with opposing answers. We should probably have checked out his degrees, even though they were from the local university and appeared plausible (and don’t forget he was a fully licensed and registered adviser, as we DID check out). We wish we’d known about those Forms ADV we're all now aware of (though his first known and reported rule breaking occurred ten years after we formed our initial relationship with him, and his first year without a license some five or six). We’d check all these things out annually now, of course. We’d also do the same things we did with him then (make sure he was backed by a reputable

company, came with glowing references and recommendations). We wish we’d reacted to every tiny twinge of doubt by asking even more questions, and probing ever more deeply. And of course we wish we’d gotten out.

But would any of this save us another time? We don’t know; we do, and will do, our best. But we live in both hope and doubt.

Monday, May 26, 2008

Wes Rhodes, the post September 2006 history (1) and Memorial Day Monday

Wes Rhodes, the story, (since September 2006--or the ASS period, i.e. After SEC Shock).

Actually, though the story of Wes Rhodes’ downfall (the "ASS" period), as perceived through the eyes of his investors, the media, and the public at large, begins in September 2006, his incredible manipulations and maneuverings started at least a year or two earlier, presumably once he realized he was under investigation, or suspected he soon might be. And I’m not even going back to his rule breaking activities in the late ‘nineties (actions were instigated against him by the State on 8/15/1998, and resolved on 3/16/ 2001, and by NASD--the National Association of Securities Dealers [whose duties were taken over in July 2007 by FINRA, the Financial Industry Regulatory Authority]. Although the NASD actions were instigated on 9/22/1998, and resolved on 4/01/1999 they were both, it seems, for the same misdeed or deeds; the result was a cease and desist order, and a pretty small fine, and he was required to retake certain exams etc in order to be reinstated; all this is summed up on his Form ADV investment adviser application for 2005, under Rhodes Econometrics. Confused yet?).

It’s hard to say whether or not Wes Rhodes realized discovery was imminent as far back as 2003, when he began to move money around like he was whisking eggs. According to a report by the Receiver, “Rhodes removed approximately $450,000 from the PPPS account from July of 2003 through September of 2003 and put it into a group of four Bidwell accounts held in the name of The Rhodes Company. In January of 2004, Rhodes removed approximately $339,000 from the PPPS Account and put the funds into that same group of Bidwell accounts. In March of 2004, the Bidwell accounts ($966,000) were transferred to Ameritrade accounts. The accounts are collectively referred to as the "Ameritrade Accounts.” The Ameritrade Accounts consisted of four accounts all in the name of The Rhodes Company."

Be all that as it may, certainly by 2005, Rhodes knew something was up. The sister of

one of his investors (we've referred to him in the blog as [Frank]) was not toeing the line. More, she had reported our Wessy Boy to the authorities, and both the State of Oregon and the SEC got involved (By the way, my understanding is that folks such as Wes Rhodes have to be registered with the state, no matter what, but if they manage more than $25 million, they also have to register with the SEC; I’m sure someone will correct me if I’m wrong. Please). So, the way I read things, Wes simply had to prove that he was really investing his clients’ money properly, in stocks and bonds (rather than "muscle cars" for his own use), and, simultaneously, to make some of his investors very happy with what he was doing, so that they would vouch for him. His activities in both regards are simply mind-boggling. This is how that particular Receiver’s report goes on: "An investor wired $3,000,000 into the PPPS Account in May of 2005, which was commingled with other Private Investor funds. Shortly thereafter, Rhodes wired $3,600,000 from the PPPS Account into the Ameritrade Accounts. From September 2005 through January of 2006, Rhodes withdrew funds from the Ameritrade Accounts and deposited them into a bank account he set up at U.S. Bank in the name of "Rhodes Company Inc. - Fund Refund Account" (the "U.S. Bank Account"). Rhodes referred to this account and the ultimate recipients of the funds as the "Total Return Fund" and the "Total Return Fund Investors." From the U.S. Bank Account, XXXX and YYYY received $1,189,464.33 in October of 2005 and January of 2006.From the U.S. Bank Account, AAAA and BBBB received $804,490.94 in October of 2005. In October of 2005, Rhodes set up a bank account at West Coast Bank in the name of "RT, Inc." (the "RT Account"). Rhodes deposited money from the U.S. Bank Account into the RT Account. Rhodes also deposited Private Investor funds into the RT Account.A whirling dervish, our man Rhodes, under the threat of investigation! And the report continues: Rhodes learned that the State of Oregon and the SEC were investigating his investment activities in approximately August of 2005. As a result, Rhodes began to devise a scheme by which he could make some of the Private Investors' investments appear legitimate. For example, in August of 2005, he requested that XXXX write checks to Ameritrade pre-dated for May of 2005 to demonstrate to the State and the SEC that Private Investors were writing checks directly to Ameritrade as opposed to the PPPS Account. Rhodes represented that he would return the requested checks uncashed to XXXX a few days later, which he did. Rhodes transferred the money set forth in paragraphs 9-13 in an effort to have some Private Investors satisfied sufficient to gain their confidence and support in the investigations. Rhodes made the transfers with the actual intent to hinder, delay and defraud creditors (the State, the SEC and other Private Investors) in violation of ORS 95.230 (l) (a).

As a result of all this activity and more, the State of Oregon Securities section began that lengthy deposition on May 25, 2006, which I’m in the process of transcribing (please note that [Frank’s] sister was the whistle blower, and, I believe, [Frank] himself is

XXXX, one of the folks who’d written those uncashed checks and vouched for our Wesley. And just remember how Wes talked about him!This May 25, 2006 deposition was followed by phone calls to various investors by the attorney Susan Schoaps who is questioning Wes in that incredible interview (and I’ll come back to them later). And then, in August, Wes was deposed again, by the SEC, to determine whether there had been violations of Federal security laws (I'll be transcribing at least part of that interview too, at some point over the next few months). This August deposition was also followed by phone calls to various investors, with similar results. And both, of course, stemmed from (and culminated in further) research into such records as Wes Rhodes provided (bearing in mind that he was still hiding most of them, or pretending they never, or no longer, existed).

The SEC complaint was lodged with the courts around 21 September, 2006, and a temporary restraining order issued. The assets of Rhodes Econometrics, The Rhodes Company, RT Inc, and C. Wesley Rhodes, Jr., were frozen. A temporary Receiver (Michael Grassmueck) was appointed, and Wes was prohibited from destroying documents as well as ordered to produce accountings. In an interview on September 22, 2006, Wes Rhodes informed the Receiver that he did not store any records at his residence and also denied the existence of an Alienware computer. One week later, Rhodes’ counsel informed the Receiver that some 52 banker boxes of documents would be produced which, counsel asserted, had been stored at the residence. These documents, however, did not contain financial records pertinent to the case. Sometime over the next few weeks, however, by noticing the initials MD on documents and finding small checks made out regularly to a woman with those initials, the Receiver and his staff located a “secret secretary” whom Wes Rhodes had utilized. Wes Rhodes counsel (Weaver and O'Connor at the time) then asserted (in February 07) that the documents produced by this secretary no longer existed.

[In fact, as we'll see later, back around that same September 2006 time, Rhodes had moved these records (along with various other interesting items, including some cash and Rolex watches) to a secret storage unit, where they would be unearthed almost a year later, at the very same time as that Alienware computer that Wes Rhodes had claimed didn’t exist would also be discovered.]

And all this was just the beginning. Even so, my head is spinning already, so I'm sure all and any readers need to go and do something more interesting. So I'll pause.

Tuesday, May 27, 2008

Wes Rhodes, the post September 2006 history (2)

I'm carrying on today with the summing-up of the amazing story of Wes Rhodes' manipulations and squirmings since the SEC "bombshell" dropped in September 2006, and we learned, with icy fingers round our hearts, that the so-called investment adviser we'd entrusted with our life savings (whether for twenty years, in our case, or ten, or five, or, in the case of some poor folks, just a matter of months--can you imagine how that felt? How they must have longed simply to rewind the tape of their lives a little?) --that this man, Wes Rhodes, the person we call our "F.F." (and we don't mean former, or furry, friend), had stolen our funds and squandered them on luxuries and crap. I call this the ASS story (After SEC Surprise), and this is Part Two (go to yesterday, Memorial Day Monday, for part one, and to Sunday for the story BEFORE September 06). As this is Part Two, I'm again using the second of those LE Baskow pictures from the Portland Tribune. Seems fitting, no? (Someone observed that it looks like he's taking aim at someone, the way he's holding those car keys! And that's kinda appropriate too, given the fake "shooting" report the little jerk recently lodged with the police. Maybe LE Baskow and Tribune reporter Todd Murphy should claim our F.F. pointed a "weapon" in their direction!! It would make about as much sense as that "rifle" Wes "saw" being pointed at him from the mystery vehicle, don't you think?).

So, the SEC had lodged its complaint about our F.F. on or around 21 September, 2006, and quickly thereafter issued press releases; the story was taken up immediately but briefly by a couple of Portland papers and the Seattle Times, among others. As one can imagine, this did NOT please our Wessy boy, who scuttled to tell his clients that all was well. I don’t know exactly what he told others (although some of us have shared our stories, and I do know he visited a bunch of folks in their homes, or saw some together in offices--actually, in at least one case, getting half a dozen folks together and then failing to turn up at the right time and face them all, preferring to talk only to one, and make him the "messenger.” Does that surprise you? Cowardy, cowardy custard, our little F.F., even then). In our case, he informed us in a late night phone call (around 10 p.m., followed by another around 11 p.m.) on Tuesday, September 26 that the whole thing was a huge mistake and that our money--all of it--was perfectly safe (I’ve written about all that in the essay, "Conned," so I won’t do it again). I have to say that the icy fingers that gripped my heart at that point told me a different story; for some reason, the moment I heard that there was a case against him, I knew, as did my husband Henry, that the jig was up, so to speak. All those tiny misgivings seemed to crystallize into a hideous realization, and a truth. I still did not, however, understand the depth of our Chummy's duplicity and the extent of his crime, or begin to understand the lengths to which he would go, or the depths to which he would sink--or had already sunk--to avoid justice and

responsibility for his actions.

The Receiver Michael Grassmueck immediately held a series of investor meetings (five or so, over the next week) and informed us with due seriousness and detail what had been found. Or rather, what had NOT been found. Of the $40+ million Rhodes purported to be “managing,” only a couple seemed to have been invested. Though Mr. Grassmueck maintained an air of strict neutrality at all these meetings, the thick three-ring binders in the conference room where these meetings were held (Rhodes’ old office digs) held accounts, statements and transcripts of interviews, such as these telling and unbelievable depositions I've been transcribing. We were assured that our Schwab (and other custodial) accounts were safe (though according to one Affected Investor friend, Wes Rhodes was actually making a couple of last ditch efforts to clear out at least ONE of those, belonging to one of those old clients, and friend, who had tried to stick by him in the face of these accusations--yes, really; remember that, as our adviser, Wes Rhodes, by and large, had "permission" to buy and sell on those accounts. Fortunately, a savvy person at Schwab saw what was happening, and stopped the transaction--and of course one of the Receiver's acts had been to alert Schwab etc, who had removed Wes Rhodes' authority over those "custodial" accounts). In my husband’s and my case, this "custodial" account represented something less than a third (slightly more than a fourth) of what we thought we had. For some people, the loss was even greater. More than one person lost pretty much everything. Every last dime; I mean it (For this reason, the term "side accounts" has never seemed truly appropriate; for many, the bulk of our holdings were in those "centralized, Wes-Rhodes-managed mutual-type funds," which were represented to us as the "safe and steady" part of our portfolio; I'm not talking here about "Diamond portfolios," or "Total Return Funds," or the like--Henry and I thought we were in a steady, managed bond fund with nothing fancy about it. Period.).

So what were the assets that our dear Wes Rhodes actually held? A couple of million in actual investments; some more here and there in various bank accounts: a million or so in a business or two, one of which dealt with car restoration (I think, without swearing to the fact, that enterprise's holdings were largely made up of proceeds from that fire sale of fourteen cars in 2005); Rhodes’ holdings in some veterinary and other businesses of various kinds; all these collections and furniture and artwork; the equity in his home at the time, and some part interest in a beach house, and in the house in which his mother was living; his own Schwab accounts, of course (personal and IRA), an insurance policy or so--the accurate list of all those assets--which changes somewhat as the months go by and more is discovered--can be read on the Receiver's webpage, in the series of reports (First, Second, Third and Fourth) all fascinating, and all available for public viewing. And then, the jewel in the crown, the famous cars--from "muscle cars" to Ferraris-- in that ridiculous "Crossed Flags museum" of his (along with a bunch of "daily drivers"), the worth of which was a matter of dispute from day one (see Exhibit B, and Exhibit B

Photographs, under First Receiver Report, on Mr. Grassmueck's website). And yes, as I've said, we learned soon enough that Rhodes had sold off some 14 vehicles in a fire sale in 2005, and according to more than one report, had had frequent similar sales over past years (speculation is that he would suddenly have to sell off a car or two when a client needed to withdraw money, so had to sell fast--and LOW, having bought high--I've learned that the car community saw our little jerk coming, and rubbed their hands in glee). But despite these sales, there were still plenty of vehicles left. And their worth, and the means of their disposal, would spark some fascinating behaviors.

Judge Michael Mosman was assigned to the case (which is the civil case, in this matter, numbered 06-1353); meanwhile, John Carr (who was Rhodes’ attorney of record in those depositions I’ve been transcribing, including that May 25, 2006 interview I'm in the midst of) had fallen off the screen. (Incidentally, just as an anecdote here, we had told Wes in those last, September 26 phone conversations that we hoped he had good legal advice; he replied that he had had inadequate counsel up to then, but now had excellent representation. I don't, of course, KNOW he was talking about John Carr, but I kind of assume so. It tickles me now to read in that deposition, talking--I believe-- of Mr. Carr (and complaining about [Frank]): "I tried to come up with some type of contractual thing that would work for everybody. I got the best person that I know in the City of Portland to help me with it, okay, and he won’t even respond to John. He would not even respond to John.” So poor old "John," (who, yes, I'm assuming is John Carr), went from being the "best person I know in the City of Portland," to being "inadequate," it seems. How many more times did that kind of thing happen over the next fifteen months! I hope Mr. .Levine is reading!!! (GRIN). ATTORNEYS BEWARE!

Anyway, whatever the case, Mr. Carr was replaced by new, “big time” attorneys, Robert Weaver and Michael O’Connor of the law firm Garvey Schubert Barer, on 9/27/06.At the same time (as I said yesterday), Rhodes (we learned much later) was moving documents and other records and valuables into storage, and indeed actually managed to withdraw (or have his wife withdraw) money from a supposedly frozen account. Despite all that, he was granted, by Judge Mosman, on October 25, 2006, access to his own Schwab IRA account which held more than $200,000. This was for necessary living expenses, apparently, and to pay his attorney fees, with the stipulation that he was not allowed to draw it down to below $25K without the permission of the court.

His old investors were not happy about Judge Mosman's decision (well, can you blame us?). But we were getting organized. One of our number (the same intrepid guy I've mentioned before who, along with his wife, has been a real trailblazer, motivator and indescribably valuable resource in the whole affair) had called some of us up to suggest we go to the Department of Justice and try to get the wheels turning in a criminal case. And so we did. We met, in fact, in October 06, not only Assistant US Attorney Allan

Garten but a couple of "heavy hitters" from the USPIS and the IRS as well (we began to learn the names, and roles, of Bob Sauter, Kevin Redden and Craig Wyly, among others--all of whom have worked tirelessly ever since, just as the Receiver, his staff, and his attorneys have worked tirelessly on the civil side). And thus the research for that (criminal) case too was quietly launched (just as the SEC had quietly researched the situation on the civil side in the year or so before September 06).

For us investors, the time was spent, not only in getting over the shock, and finding jobs again (in my husband’s case reactivating his medical license; in mine, trying to finish a couple of books in hopes of making a buck or two--oh, dream on, Cate!--and in many people’s cases going back to work, or desperately trying to find new work), but also in trying to collect, collate, and basically to find, or rediscover, everything relating to our dealings with Wes Rhodes (in our case over two decades).

And I really want to make a point, here. I don't think people who haven't undergone this kind of thing realize this, but believe me; it’s not easy to be a victim. Whereas a perpetrator is “innocent until proven guilty” (and absolutely rightly so), a victim of this kind of white-collar crime has to PROVE he or she is a victim, by the production of canceled checks, and statements, and publicity material, and brochures, and tax returns, and 1099s, and exchanges of letters, and e mails and every other goddamned thing you can think of under the sun. And that's not always easy, given that banks and other financial institutions destroy records after seven years, and that many of us probably do likewise (Guess who used to tell ME it was fine to shred stuff after three years or so? Yup, you got it! Fortunately for us, I didn't take THAT advice--though I didn't keep EVERYTHING for two whole decades--in fact, we'd moved house and "downsized" just ONE MONTH before the SEC bombshell dropped. And that included getting rid of some ancient paperwork--though not our F.F.'s statements to us, interestingly enough! Did I suspect, in my gut? I don't know). Anyway, I can tell you that I spent hours and hours on phones, on hold, to this institution and that institution, with varying degrees of success. And I can add that, as our history went so far back, some of the folks who’d actually managed my husband’s money before Wes did had long since died. And that trying to reconstitute twenty years of history can be heart-breaking, not only because of the frustrations involved, but for all the old joys and sadnesses you revisit along the way. And, once again, I think I can assert without fear of contradiction that many, many of Wes Rhodes' old clients had to spend hours upon hours upon days upon weeks upon months in exactly the same way.

And then all these documents had to be sorted, and photocopied, and mailed or delivered, both to the Receiver (who had shortly after the temporary assignment been appointed as a Permanent Receiver), and the Department of Justice (as we had the two-pronged thing going). And sometimes these documents had to be photocopied and delivered more than

once (in our case, for example--and I'm sure in that of many others--my husband gave a deposition directly to the SEC's wonderful attorney Janet Moser, and we had to provide the stuff to her too. And all this is right and proper, but it takes hours and days--and sometimes nights spent wakefully trying to remember, and recall, and get all this stuff together). And then the process all has to be done again, for the Receiver, when the time comes for filing claims. And then, for many of us, these same documents and statements and assertions have to be pored through, and scrutinized, and explained, and analyzed WITH the good folks from the DoJ, and the US Post Office, and, ultimately, for some of us, the Receiver and his staff. And all that is as it should be, no doubt about it. And I'm not whining, honestly, I'm just sayin.’ But believe me, it’s hard, both practically and emotionally, for all kinds of reasons. Anyway, meanwhile, by the end of October 2006, the Preliminary injunction was signed by Judge Mosman (October 30, 2006) and the Temporary Restraining Order extended.

And that’s probably enough for today, no? And tomorrow, May 28, 2008, is National Seniors’ Health and Fitness Day and the day I’m going to publish the results of the Limericks Competition (new readers, please understand that we HAVE to take a little time off from these more serious matters now and again, or we’d go mad. Well, I would. All this stuff takes a toll, I must admit. I need, from time to time, not a day off from the blog itself, but a day off from serious matters--a day off for "bad behavior," if you will). So please check in tomorrow for a bit of a change, a giggle and a laugh; there are some really good ones (AND IT'S NOT TOO LATE TO SEND MORE, YOU GUYS).

I’ll continue with the Wes Rhodes’ post-September-06 story on May 29. "Wes Rhodes, The ASS Years.” I can see the title of the Kitty Kelly-style, ten-volume unauthorized biography now!!! (NOT).

Thursday, May 29, 2008

Wes Rhodes, the post September 2006 history (3)

So, here we are, back with the Wes Rhodes’ post-September-2006 saga (Wes Rhodes, the ASS years). This being Part Three, I’m using the third photo from the Portland Tribune, by photographer LE Baskow. And I think this is the picture that’s exclusive to the blog, which is pretty dashed exciting, though I say so myself.

I’m doing this potted history for the benefit of new readers, but also because it’s useful to recap, as we look down the still long tunnel of days (129, and counting) towards the glimmering light of October 6, the date currently set for the beginning of the much delayed sentencing hearing in the criminal case (#07-289) before Judge Ancer L.

Haggerty. Look at the blog post for Sunday, May 25, 2008, for a very brief history of the pre-September, 2006 years (the BS years ), and then for Monday, May 26 (part 1), and Tuesday, May 27 (part 2), of these ASS years. And please remember that I am NOT an expert, nor am I going to even attempt to get every last date and detail down exactly here. I'm just trying here to sum up a bit of the story, in the broadest of terms--if I say something happened around March 12 and it actually happened around March 20, so be it. This is not like a sworn statement in a court of law, in other words. It’s a broad outline--no more, and no less. Go to the various reports on Michael Grassmueck's website, or to the legal documents filed in the courts' electronic records, on Pacer, for the minutiae.

As I recall, the last thing I’d said was that the TRO had been extended, and the preliminary injunction signed (on October 30, 2006) by Judge Mosman, all of those things in the civil case (06-1353). We were all madly getting ourselves back to work to try to earn our livings again (despite having, most of us, retired) or wondering, suddenly, when we would be able to afford to retire. We were also busily gathering documents for the Receiver, the SEC and the DoJ. We’d appointed a very informal Ad Hoc committee, members of which did a fabulous job OUTSIDE of the official proceedings by gathering (unofficially) phone numbers and e mail addresses of the folks they managed to get hold of in meetings etc, and keeping us all closely informed. Our thanks are still due to every last one of them.

The next dramatic occurrence, however, was nothing to do with these "official" proceedings, but was a huge surprise and shock. I’ve told before on this blog the story of “Margaret,” a delightful woman who, with her husband, had been a long time investor and “friend” of Wes Rhodes (though, in fairness, I have to point out here--or she’ll be mad at me!--that she never liked the guy!). Anyway, “Margaret’s” story is important because of recent events which I haven’t had a chance to talk about yet, so I’m going to try to sum it up again a bit here. Yes, regular readers, you’ve heard much of this before. But it’s really relevant. You’ll see why, as this potted history begins to draw to a close.

As I say, “Margaret” is the wife of one of the people Wes had known longest, and who, with her husband, their family, and their businesses, had lost even more than most. So “Margaret,” by the time she and her husband and others fully accepted, in the fall of 2006, that Wes Rhodes had well and truly betrayed them and us all, felt pretty angry. Well, wouldn’t you?

Anyway, on the evening of Tuesday, October 24, 2006, "Margaret" had called Wes’s cell phone to give him a piece of her mind. And what she felt like saying took longer than the allotted three minutes of voice mail, and she was cut off before she'd finished saying her piece. So she immediately called back, as one does, and tried to finish her message. Yes,

she left a two or three part message on his BUSINESS CELL PHONE, the number of which he gave to all his “special” people, his investors, the number he told us to use for him personally, as in one of his old email message to me--and I quote, "Let me know PERSONALLY if I can help you in any way. I serve you; I don't allow any one else to serve you. That is for me alone, dear Cate.” [Jeez! Why didn't I realize then that such a smarmy git couldn't be on the up-and-up!!?? Is "git" an English word, like "gobsmacked?” It's a good one, you must admit!--the "g" is hard, by the way, as in "garden."] Or the same cell phone of which he spoke to "Carol's" daughter (see post for October 18, 2007). "Never call my office staff again,” he told her. “Call my cell phone only. You’ll get your receipt. Don’t you trust me?” In other words, the cell phone that HE ALONE USED. So, just to repeat; "Margaret" called him, not on his home phone, or his wife’s phone, or even his regular office phone, but HIS CELL PHONE. The cell phone on which he instructed his investors to do their personal business with him. And each time "Margaret" called (and was cut off) she got the voice mail, as I say, and left her two- or three-part messages.

Now she is the first to admit that, on that Tuesday, she spoke in extreme anger, and that the anger increased as her message went along. Yup, she even said some naughty words. Just imagine that! So that night, as she lay awake, thinking about what she’d actually said, and really wanted and meant to say, and how she still hadn’t managed to do precisely that (and had in fact gone a bit further than she intended, and been ambiguous), she decided that, instead of just fuming and ranting and being ambiguous and going too far and not getting things exactly right, she would write down what she meant in the form of a speech, or letter, and read it aloud, the next day, in another attempt to get through to the F.F. And once again she called HIS BUSINESS CELL PHONE the following morning, and this time read off her letter (which I’ve seen, and in which there are no swear words, invective or “threats,” even ambiguous ones). But because, again, she had more to say than the three minutes of voice mail time would allow (and yes, this is still all to WES’S CELL PHONE--I can't say that too often, in my opinion!), she again called two or three times in quick succession to get the whole thing out. So a couple of “cut off” calls on the evening of October 24 and a couple or three more “cut off” calls on the morning of October 25. And once she’d reached end of her “letter,” she was done. No more calls at all. NOT ONE.

Now Wes taped one of these outbursts somehow. And yes, you’ve guessed; he taped the one from the Tuesday evening, before Margaret had collected her thoughts properly--the one that sounded most angry and unreasonable (what am I saying? It was perfectly reasonable to be angry! But you know what I mean, I'm sure). The first words of the recording he made are in fact his (or, technically, I should say those of “someone using his voice,” or “sounding like him”). And those words are “Get away from the fucking mike.” (Could he possibly have been talking to his wife? Or his step-children? Surely

NOT!). And at the very end--and this is important--his voice can be heard again saying, “That was XXXX" (the person I, Cate, now call “Margaret,”) and giving the exact date of October 24, 2006.

Well, TWO WHOLE WEEKS LATER (during which “Margaret” had made no more phone calls remember) ANNE Rhodes, (NOT, technically, WES RHODES--though in WES'S handwriting on the whole of the actual order, apart from Anne's tiny signature at the end) filed a temporary stalking protective order against Margaret. This order, I repeat, was not for WES (whose cell phone had received the messages, remember), nor even for HIS children, or any other of his family members, or friends, or acquaintances, but for ANNE. Yes, for ANNE! Even though Margaret’s messages were on Wes’s business cell phone. And never mentioned Anne, or Anne’s children, or any other members of Anne’s family, at all.

I repeat, the protective order is filled out in Wes’s handwriting (I should say, handwriting that looks like Wes’s) even though it is supposed to be Anne’s words. It's also Wes's "style.” And what does it say? Well, for example, "Anne," in Wes’s written script, states, about Margaret, "She has directly threatened me and my family" (from messages left on Wes’s cell phone? About him?) Again, Anne, in Wes’s script, says, "Our husbands are engaged in a business dispute that is being investigated by the SEC. In a meeting with my husband she used very threatening words.” (A business dispute with the SEC? Yeah, that’s it. Just a “business dispute!” And, apparently, according to witnesses, the very threatening word that “Margaret” used was “No!” when our F.F. Wes Rhodes asked several of his old friends and investors for more time to “prove” himself after the SEC bombshell had dropped).

So, what about the charge itself, then? Was “Margaret” a person likely to do violence, from whom anyone actually needed protection? Well, according to "Anne," in Wes’s handwriting, under some heading about “weapons,” “she carves wooden Christmas ornaments as a hobby with knives.” Yes, that’s what it says. I’m not kidding. A veritable gang-banger, that Margaret, I’d say, especially if carving Christmas ornaments with a tiny craft knife shows evidence of a facility to wield weapons!

Anyway, to cut a long story short, a hearing was scheduled in the Oregon City courthouse for, if memory serves correctly, December 4, 2006, around 9 or 9.30 in the morning. Anne, back then, was represented by Jacob Wieselman; yes, the same Jacob Wieselman who still, I think, represents both of them in the civil case, and, for a while, represented Wes in the criminal case (07-289)(following Weaver and O'Connor of GSB, and until Mr. Michael Levine took over). But at that time Mr. Wieselman represented ANNE alone. (And of course I for one had never seen Mr. Wieselman in person before that hearing).

As you might expect, a few of us--half a dozen or so, including Henry and myself--decided to go down to Oregon City and show our support for "Margaret" for that December 4, 2007 hearing. And while “Margaret” was waiting with her attorney in the courtroom itself, the rest of us gathered to chat in the hallway, where we were joined by a smart-looking, affable guy who basically asked us, nicely and politely enough, who we were and what we were doing. We explained our position as “affected investors.” Whereupon the gentleman said words to the effect of, “Oh, well, I gather Wes Rhodes has a car collection worth around $13 to $15 million, so you’ll be getting all your money back.” Well, I must say his comment was a bit of a stunner. Well, it kind of surprised me, anyway. So we informed the gentleman that MUCH more than that was owing—more like $40-plus million was at stake, we thought (or possibly way more than that if you count purported profits) than $14 million. And that we thought (from what we’d been hearing via the ad hoc committee who had talked to the Receiver, who had been busy acquiring bids) that the car collection was probably only worth $3 million, or maybe up to $4 million TOPS, according to various reputable valuations. And certainly NOT around $14 million.

(Interestingly enough--and I’m getting ahead of myself here--the only two sources I know of who’ve claimed these "gazillion millions" for the car collection have been an antiques dealer named John Hays in a “valuation” which he himself later admitted was pretty much dictated to him by Wes Rhodes, and a bid from Oswego Luxury Motors based, I believe, on that same "hazy"--yes, that’s a pun-- Wes Rhodes’/John Hays' valuation. And later that same year, (around July 5) Wes, through Mr. Wieselman (who was by then his attorney too), lodged a complaint about the cars going to the Receiver’s auction house of choice-- Bonham’s--rather than to, say, Oswego Luxury. Mr. Wieselman had also been present at a meeting at OL about that bid, when he was still only Anne's attorney (around May of 2007 perhaps. I don’t know the exact date of that OL meeting, but it was certainly before Robert Weaver et al were to quit in June). Though of course all that was months after the hearing I'm talking about now. I’m just trying to give context here, as the value of the cars, and who thought they were worth what, and why, and when, became a matter of huge dispute as the year went on. And this amazing $14million figure was, as I say, first heard by a few of us at this December pre-hearing regarding Margaret’s “stalking").

Anyway, back to December 4, 2006. Into the courtroom we all trooped, and the judge came in, and the smart, affable gentleman, who of course—you’ve guessed!—was Mr. Wieselman, got up and immediately suggested to the judge that the Wes Rhodes’ case be excluded from the day’s hearing (I don’t know the correct terminology) because it was irrelevant. He also referred to our presence there, as though he perhaps believed we were witnesses, which of course we weren’t. Whereupon the judge--bless his heart! -- glanced

through his papers and concluded very quickly that the Wes Rhodes’ case was VERY RELEVANT, and SHOULD be included (and actually went on to recuse himself because he knew Rhodes when he was on the board of the Portland French School). Meanwhile, though we believed that Wes and Anne were in “da house,” (I’m not sure that we knew that for a fact, but we had the impression they were there), they didn’t show their faces. Anyway, a new date of January 4 2007 was set for a proper hearing with a new judge (I can’t remember whether it was set there and then or sometime later). And Wes Rhodes' part in the affair was allowed in.

The rest of the story, I guess, is in a way a bit of a let-down. The Rhodes,' ("Anne," I should say) suddenly became willing to drop charges if "Margaret" paid legal fees incurred so far (I'll come back to all this in a few days' time). But Margaret refused, and moved forward, and her attorney subpoenaed Wes to appear at the Jan 4 hearing. We were all pretty excited, because this meant our F.F. would have to take the stand and be under oath, for the first time in front of us; we were naturally intrigued to hear what he would say. I longed to know, as I still do, how he would explain his actions. But the next we heard was that the Rhodeses (I should of course say "Anne" again) and Anne's attorney had dropped the charges and claimed that Margaret (and her attorney) were making the case a farce and just making the poor, poor Rhodes duo suffer even more (on top, I suppose, of the "suffering" her "stalking" had caused--yup, those messages on WES'S cell phone must have made ANNE suffer all right!!?? Wouldn't you say? Unless, of course, he had decided (loving, protective husband that he claims to be) not even to let her hear them--especially as they didn't mention her--hmmm!). So that January hearing—I mean, Jan 4, 2007, —did not take place. And there the story should end. But, oh, dear readers, it doesn’t, as you will see when I’ve finished playing catch up.

But that’s enough for today, I think. Part 4 tomorrow. And as I’ve now run the gamut of the LE Baskow pictures again, I’ll be dipping back into the treasure chest of goodies provided by my talented photoshopper friend. Can you wait?

Friday, May 30, 2008

Wes Rhodes, the post September 2006 history (4)

I know, I know. It’s taking me WAY too long to tell the Wes Rhodes’ post-September 2006 saga (what I call, the ASS Years--for A-fter S-EC S-urprise, of course!). I’ll try, for the next few days, to speed things up a little, with fewer details and side trips (but you know how I LOVE those side trips!) After all, we only have about four and half months to go, and I need to make sure I get everything in, including the things that haven’t happened yet (GRIN). I took a long time yesterday over the “Margaret” story again, but I have my reasons. So please bear with me. Anyway, it must be apparent even to new

readers at this point that Wes Rhodes is a slimy creep, so I’ve used the first in my talented photoshopper’s “Wes, Gatorman” series. Like it? I know I do.

So, back to the job in hand. And here we are at the beginning of February, 2007. I have to preface all this with the reminder that I'm writing as a layperson, giving broad outlines, and striving more for the "story" itself than for absolute accuracy regarding dates etc. And if I make typos when copying official documents, please forgive me (it's hard to proof-read one's own work--please refer to the Receiver's webpage for some crucial documents, and to the Oregon District court's online records filed with Pacer, with the given case numbers (06-1353, as the "mother of all cases" on the civil side, and 07-289 on the criminal side); both of those sources provide "the real deal").

If you remember, the Receiver and his excellent staff had discovered the existence of a “secret secretary” with the initials M.D. (a totally innocent third party, incidentally), who had, they asserted, been used by our F.F. for some time to type up those quarterly statements for investors that our F.F. had at least implied didn’t exist (if you recall, he implied as much even in that May 25, 2006 deposition I’ve recently been transcribing, and will come back to). Anyway, on or around February 7, 2007, our dear Wes Rhodes’ attorneys at the time, Robert Weaver and Michael O’Connor, asserted that, although M.D. herself had been found to exist, our F.F. had nevertheless not FAILED to produce certain documents requested by the receiver, because such documents ("source documents" used to generate a list of investors) no longer existed. And I hasten to add that I’m sure they were telling what they thought was the truth.

Of course, the month of March, 2007, is vitally important in the story, because on March 4, 2007, I started to write this blog. Hurrah! What a timid little thing it was, too! And little did I know how long I would be writing. And how many words would be generated! Yikes.

More importantly, however, on 30 March, 2007, the Receiver submitted his second report, which can be read on his website, and provides many, many fascinating insights! (I can't remember whether I mentioned that the preliminary report had been produced on October 26, 2006--it's really interesting to compare reports 1, 2, 3 and 4, and see how the picture develops as more and more interesting twists and turns are discovered).

On April 17, that Cease and Desist order I mentioned a couple of days ago was signed NUNC PRO TUNC 09/15/06 (meaning it was kind of "backdated" to Sep 15 2006--layman's terms again). And on April 18, 2007, we saw the entry of the Permanent Injunction.

On May 4, our dear Wes Rhodes asked again for access to money, this time in the shape

of his Schwab One account which somewhere around $100K. Ostensibly, this was again to pay his attorneys, I believe. There were objections, including one very strong objection from the SEC dated May 10, 2007 that asserted, among other things, that there was no reason to believe that funds in that Schwab One account did not include investor funds. On May 14, Wes, through his then attorneys, answered this objection with a reply that included these paragraphs: “Mr. Rhodes' present counsel is very close to reaching a final consensual resolution of the present case and the potential criminal charges against Mr. Rhodes. Failure to release funds from the stipulated preliminary injunction to pay his legal bills will drastically postpone and complicate this resolution as new counsel is forced to familiarize herself with this complicated case.Releasing sufficient funds now to pay outstanding legal fees will ensure maximum recovery for investors and minimize the expenditure of resources of the SEC, the receivership estate, and the Court.Mr. Rhodes does not dispute that the question of whether or not to release the Schwab One account from the preliminary injunction is firmly within the discretion of the Court...Where present counsel is extremely close to finalizing a resolution of this case and potential criminal charges, however, the Court should exercise it's (sic) discretion to allow counsel to complete the representation. If Mr. Rhodes were forced to obtain new counsel at this late stage, the necessary expenditure of resources out of the receivership estate for the receiver and his counsel to familiarize new counsel with the case and re-commence negotiations concerning the disposition of defendants' assets could well equal, if not exceed, the relatively small amount in the Schwab One Account. Starting over again with new counsel for Mr. Rhodes would also result in needless waste of resources by the SEC, the U.S. Attorney's Office and the Court.

And what, you ask, is so fascinating about that? Well, shortly thereafter (as you’ll see below) these very same attorneys DID in fact step down, and a new attorney (Mr. Wieselman) WAS appointed. (The implication being therefore that there nevertheless WAS "the necessary expenditure of resources out of the receivership estate for the receiver and his counsel to familiarize new counsel with the case and re-commence negotiations concerning the disposition of defendants' assets...[and a] needless waste of resources by the SEC, the U.S. Attorney's Office and the Court" that perhaps those very attorneys had warned of mere weeks earlier). However, Judge Mosman granted the request for those funds to be released on May 18. Here is the Docket Text: ORDER: Defendant's motion to release the Schwab One Account...is granted under the following conditions: 1.) the funds from this account are to be used for attorney fees only; 2.) the funds from this account are only to be used once the funds from the previously released account are exhausted; and 3.) in the near future, the court will require an accounting for attorney fees paid with Schwab One Account funds. As readers can imagine, we investors were “thrilled” by this again (NOT!).

[By the way, here follow a sentence or two from a very interesting (in my opinion) paragraph from the SEC’s opposition mentioned above; I’ve removed the case references, just for ease of reading: “Fifth, the Supreme Court has held that a defendant has no right to use another person's funds for attorneys' fees… Neither a criminal defendant nor a civil litigant has the right to pay counsel with another person's money…Similarly, another case applied the Supreme Court's reasoning in Caplin & Drysdale directly to securities violators, stating: "Just as a bank robber cannot use the loot to wage the best defense money can buy [citations omitted] so a swindler in securities markets cannot use the victims' assets to hire counsel who will help him retain the gleanings of crime.” … ("defendant in a case brought by the SEC many not use income derived from alleged violations of the securities laws to pay for legal counsel.") …("defendant is not entitled to foot his legal bill with funds that are tainted by his fraud" (internal quotations omitted)]

And, while I’m quoting here, and as I was talking yesterday, and will talk below, about the value of the “muscle cars” and the discussion of the same, here’s another quote (expressed as a footnote) from that very same SEC document/objection, their quote mostly taken from the Second Receiver Report I've referred to above and highly recommend for readers to peruse:

Rhodes' suggestion that the automobile collection may be worth ''between $12 and $14 million" has been discredited. As the Receiver explained: "Due to the unique status of these vehicles, the Receiver has not assigned a value on each. The value of each vehicle can vary widely depending on demand, vehicle lineage, market fluctuations, distribution channel and a myriad of other factors. However, the Receiver has communicated with the classic car auction houses of Bonham and Butterfield and Mecum regarding the value of these vehicles. Bonham and Butterfield provided the Receiver with a range of approximately $4.5 million to $6.5 million. Mecum provided the Receiver with a range of $4 million to $6 million. These estimates provided by experts in auto sales gives the Receiver a base line as to the value of the vehicles. It should be noted, however, that these values are far less than the values upon which Defendant relies in his purported appraisal in the summer of 2006.The purported appraisal that Defendant produced lists the vehicle values at approximately $14 million. This estimate was allegedly completed for Defendant by Mr. Hayes. During his SEC's deposition, Mr. Hayes admitted that his skill and knowledge rests in the valuation of antique furniture and not cars; and that virtually all of the .information and values of vehicles contained in his report were derived from information provided by Defendant."(Second Report of Receiver Michael A. Grassmueck, March 30, 2007, p.21.)

But back to the story! Given our F.F.’s need for all this extra cash (and the fact that the

Schwab One account had now been released, on top of that IRA account, primarily, we thought, to pay legal fees) you can imagine our amazement when, on or around May 3, 2007, we discovered that Wes and Anne had, somewhat secretly, it must be said, and in Anne’s maiden name, of course, bought a new house in Oregon City, worth nearly $450,000. What’s more, they’d acquired it with a “no docs” mortgage of around $300,000, meaning that (despite frozen funds and whatnot) they’d managed to lay out roughly $150,000 as a deposit (I’m using round numbers here). According to reports, they claimed that Wes’s mother had loaned the money for the deposit to Anne. I admit we all felt a tad suspicious. Well, could you blame us? (And in fact, we were later to discover that Mrs. Rhodes, Sr., had in fact loaned a "mere" $25K. So where had the deposit money come from? Hmmm. I don't know the answer to that, of course. But as I read and reread all the above, I do scratch my head a little. Don't you? I even have to wonder about the final payment of those lawyer bills...??? And I guess I'll never know). What’s more, they had also (somewhat secretly, it must be said again) moved a bunch of the more expensive furniture and art-work from their previous home in West Linn. This stuff included, among many, many other pieces, some of that snobby, spendy “Althorpe collection” furniture you can find in up-market home design magazines, and a ridiculous golden lion statue they had erected, on a marble plinth, near the pool in their West Linn home, to commemorate their April 2000 marriage. The fact that the whole collection reeked of appalling bad taste did not take anything from the much MORE sobering fact that it had cost a great deal of money--our money, we Affected Investors felt. The stupid gilded lion became a symbol of wretched excess and extravagance in more than one set of our “old Rhodesian” eyes! How they did all this, and what their attorneys might have thought or known about any of it, may never be fully revealed (one assumes and hopes the attorneys knew nothing). For at about this time, as I said above, there was an all-change on the attorney front. Weaver and O’Connor dropped out; Jacob Wieselman (yes, the very same who had been Anne’s attorney on "Margaret's" stalking charge, and had said that Wes’s cars were worth $14million, or so he thought) stepped up to the plate. I seem to recall that Mr. Wieselman at one point told the Receiver that, so far as he knew, the furniture, all of it, was still where it should be. So, as I say, one has to assume that Wes Rhodes still wasn’t telling his attorneys everything. All that is a bit of a mystery, a conundrum and a riddle. Weaver and O’Connor did, however, present their bill for $95,816.19 to the court, saying that amount had not yet been paid (out of an original bill for $207,999.83).

Meanwhile, as I’ve said, the cars--especially the “muscle cars”-- became increasingly the focus of everyone’s attention. Where and how should they be sold? And indeed, when? There had already been delays, apparently, on the part of our F.F., in relinquishing the titles and other documents--and remember, all delays and prevarications end up costing the "receivership estate" (i.e. US, the "victims") money. The Receiver of course had been eliciting bids from various quarters (including those mentioned above). Discussions

of other possible venues included such places as Barrett Jackson and Russo and Steele, and even E-bay. An old Rhodes’ investor, Tim Merrihew, even traveled down to BJ on his own dime to check things out there, for the edification of the ad hoc committee and other old Rhodesians. Most bids and assessments, formal and informal, including “guestimates” on the part of those of us who knew something about cars (clearly not ME!!) --apart from that $14 million valuation that apparently stemmed from Rhodes’ own estimation (I almost wrote "imagination," naughty me!) -- seemed to be lodged in the $3-5 million range. There was further mention and discussion of Bonhams and Butterfields, a couple of representatives of whom actually met with the ad hoc committee and talked to its members, as a courtesy --bearing in mind, of course, that the Receiver and his office, with the court’s approval, were the final (indeed the only) arbiters in all and any such decisions, as they always, rightfully, should be. However, I was at that presentation, and I can tell you that B and B seemed to have made a very attractive and comprehensive case, which involved full research into the cars’ “pedigrees,” as well as a plan basically to take care of the disposition of the vehicles from start to finish, including their transport to the auction venue, and their upkeep, as well as their ultimate sales (I’m talking here about the “muscle cars:” other cars, including the Ferrari, would be sold locally)--all these latter being considerations that venues such as BJ or Russo and Steele couldn’t possibly promise. All this was discussed pretty fully on the blog at the time, and interested new readers should go back to last summer to get full details. As discussions continued, we heard from various sources that Wes Rhodes was getting pretty agitated (or, as we’d say in England, “getting his knickers in a twist”). And we were not wrong…

June 2007 saw the publication of the first “big” spread in the media, with James Pitkin’s colorful and well-written article in Willamette Week on June 27, 2007. And it was with total delight that old Rhodes’ investors walked around town and saw the really brilliant caricature of Wessy boy on that paper’s cover as “The Collector,” drawn by Eben Dickinson. In fact, I think I’ll publish it again here, it is so COOL. And I reckon, once again, that this is enough for one day, no? Part V tomorrow (Am I going too quickly now? I hope not. I should try to finish by the end of the month, no?)

Saturday, May 31, 2008

Wes Rhodes, the post September 2006 history (5)

Yikes. I just realized this is the last day of May. Will I get to the end of the Wes Rhodes’ post-September-2006 saga today? I’ll try. New readers should go back to Parts (1), (2), (3) and (4) and indeed to the day before that for a bit of a pre-2006-story-in-a-nutshell. Just click on the links. (Today's picture? Just my talented photoshopper's second in the Wes-Gatorman series! Like it? I do).

So where were we, when I left off yesterday? I think I'd just mentioned that Wes Rhodes had a new attorney in the criminal case (Jack Wieselman--whose face we all knew by now from the civil case, and from the old "stalking case" against "Margaret") and had been given access to a second Schwab account (his Schwab One, on top of his IRA) to finish paying the old attorneys. (He did, incidentally, quibble over their bills, and I can't say for sure what-all came of that (especially given that he/Anne bought a house shortly thereafter). I'm also still not entirely certain how much exactly was in that Schwab One account. I said the other day that it was "more than $100K," and, in fact, it may have been as much as $137,000.00. Around $95K of that was destined for the "old guard.” And, according to my old blog post for Tuesday, June 19, 2007, Wes's new attorney, Jacob Wieselman, felt that the rest should be earmarked for HIS fees. This is (slightly edited) what I wrote back then: "Apparently, today, the Receiver Michael Grassmueck went back to court on our behalf. I understand that Wes Rhodes was not originally given $98,000 to pay his attorneys but MORE! In fact, something like $137,000. Well, I understand that more than $90,000 of that was destined to pay the Old Guard, and namely, Bob Weaver and Michael O'Connor. So, the Receiver was applying to the judge to get the $40-plus thousand back, on our behalf (after the bills are paid, of course). Naturally, Mr. Wieselman protested that he had hoped he would be paid out of the remaining sum, but, I guess, this time Judge Mosman...granted the Receiver the money! Yeah! At which point, I understand that Mr. Wieselman proclaimed that he would therefore no longer be able to remain as Wes Rhodes' attorney, what with there being no funds forthcoming.” I speculated at the time about whether Mr. Wieselman would in fact stay on. But, as we all know, he did, in various capacities. I think that, at the time, we old investors clutched at Judge Mosman's decision here with delight; he'd quietly ruled in favor of the Receiver (and thus the SEC, and us), whereas before he seemed to have said "yes" to all the defense's requests. Without wishing ill to Mr. Wieselman (on the contrary--I believe he should certainly have been PAID, but not by US), we felt there was a sea-change, perhaps, in attitudes, as reflected in the judge's thinking here.

Anyway, July 2007 was a "merry month.” Many, but not all (not this old blog-marm, for example!), old “affected investors” were perplexed to receive a couple of Anonymous Letters, the first on July 9, and the second on July 15. These wretched missives, which I didn’t actually publish until Oct. 8, and Oct. 11 (there was to be a third, which I published in two parts on October 13 and October 14), concerned the "muscle cars" in particular, and especially the place and manner in which the Receiver had decided to sell them (Bonham's and Butterfields’ Quail Run auction at Pebble Beach on August 17). Now obviously I have to be careful here. The authorship of these letters is not, strictly speaking, “proven.” But there were enough clues as to their origin for most of us to suspect, very strongly, who the writer was; I can tell you without doubt that a Miss

Marple or an Hercule Poirot would have had admiring audiences applauding their obvious conclusions if they were pointing out the "give-aways!"). Anyway, these stupid letters accused the Receiver of all kinds of negligence, and seemed to be asserting that the author’s attorney felt that some of us could be sued for “endorsing” the Receiver’s decision to sell the cars through Bonham's. Tim Merrihew (the guy I've mentioned a few times, with his wife Linda, as being a driving force-to-be-reckoned-with in this whole affair--and therefore clearly a target for the Anonymous Secret Scribbler (A.S.S.) whoever he was, ha, ha) was one such; “the writer of the blog” (Hmmm--who dat?) was another. The first letter writer said of Tim and myself, among other things, “They’ll get theirs.” Which frankly ticked me off. I mean, I don’t mind people disagreeing with me or fighting with me, if they say who they are. But to do so anonymously? And to threaten whatever “theirs” is? I mean, that sounded like an attempt at intimidation to me. Well, I lost my rag a bit. And thus the expression “Pusillanimous Mouse Turd” was coined. Anyway, I don’t want to spend more time on such garbage again here, so please just click on the links above, or here, for letters One and Two.

Meanwhile, on 7/27/07 the first legal documents were lodged in the Criminal Case (07-289), which was to be assigned to Judge Ancer L. Haggerty. We knew, of course, that investigations on that side of things had been proceeding for months; we had been diligently collecting and presenting whole suitcases full of documents to DoJ investigative folks such as Bob Sauter and Kevin Redden; many of us had been interviewed (nay, grilled! GRIN). And of course Rhodes’ now “old” attorneys Weaver and O’Connor had, as I said yesterday, intimated a settlement might soon be forthcoming, even in the criminal case, shortly before they quit. Be that as it may, we heard that there were to be two counts (1) mail fraud and (2) money laundering. What’s more, we heard shortly thereafter that Wes Rhodes, through his attorney Jack Wieselman, was offering a guilty plea, which would be heard on August 7. We were frankly over the moon.

Meanwhile, back in the civil case, Wes/Wieselman asked, on July 27, for an extension of time to review the Receiver’s proposal to sell the “muscle” cars at auction, but then shortly thereafter withdrew that request and consequent objections; our F.F. nevertheless offered a list of items he considered “missing” from the Bonhams’ descriptions of the various vehicles (the implication mostly seeming to be that various authenticators had gone “walkabout” in what our F.F. was apparently inferring were suspicious circumstances--or at least that's how I read his notes).

Slightly earlier, back on July 13, the Receiver had filed a motion to begin the claims process, and on July 31, Wes filed a “non objection to that claims process,” but expressed the wish and expectation (I express this in layman’s terms) to be able to see and review these claims and “help” the Receiver determine their validity. Yes, he really did! He was suggesting HE should tell the Receiver whether or not our claims were valid! Can you

believe that? The presumptuous, arrogant little git! My blood boils even now, as I write about it. Readers can imagine the extent to which that pleased ALL of us old Rhodesians (yup--this is one of the occasions I think I dare say I probably speak for us all!!). That Wes Rhodes should even clap his eyes on our financial details again--or any other personal details about us-- felt like a new violation. What nerve, was largely my reaction (between bouts of gagging), though I probably, even in my thinking, used more colorful words for "nerve."

Anyway, the plea hearing did in fact occur on August 7, 2008 (a fact that probably lulled us into thinking other hearings would take place as scheduled--as I say, we had a lot to learn!), and it was just grand to hear the word “guilty” escape from Wes Rhodes’ mouth. However, our joy was slightly tempered by some of his wording. The description of the event is given on that day’s blog post. And it’s important to remember that the sentencing for crimes such as Rhodes’ is at the judge’s discretion, but is based on certain guidelines, which can be affected by other factors, or “enhancements,” relating to the amount of money stolen, and the number of investors, among other things. So it’s in a defendant’s interests to minimize the amount stolen, and the number of people affected (NB, this was always a stumbling block for me, in my ignorance of legal matters, when I tried to work out how Mr. Wieselman could represent both Anne, in the civil case [where his “duty” appeared to be to get as much money as possible for her] and Wes, in the criminal case [where his “duty” appeared to be to minimize the amount of money taken from the investors]. But hey, what do I know?). Anyway, this is what Wes said, in court, to describe his actions: "I supplied investor funds to be invested in securities to purchase collectible commodities, including vintage American muscle cars, and this was done without the authority or knowledge of certain of my investors.” You see how he implies that these cars were 'investments,' purchased by 'securities,' and that, if 'certain investors' didn't know, then, by default, some did. Frankly, I felt outraged by this assertion, as I'm sure did many others. "Invested in securities," indeed! "Securities to purchase...MUSCLE CARS!!” How could he be saying he was "supplying investor funds to be invested in securities to purchase collectible commodities," when what he did, we all believed, was buy cars and other luxury items for himself and wife? His name was on the titles, not ours, and not his companies,' so far as we knew. In his daft "museum tours" he'd described his cars and "stuff" as treasures to pass down to his descendants. How could he be saying those things, in a court of law, and not be committing perjury? We simply couldn't understand (still can't, if I'm honest). Then, when Judge Haggerty asked him, regarding the plea of "guilty," “Do you understand these rights you are giving up as part of this agreement with the Government?” he replied: “I do now, Your Honor.” I asked, back then, as did others, what was the significance of that word, "now.” As we all know, he later “sacked” Wieselman as his attorney, on grounds of...what, exactly? Mr. Wieselman was not asked to give the reason in court, other than something nebulous to the effect that he and his client could no longer work together (this lack of compatibility

apparently confined only to the criminal matter--I still haven't heard that Mr. Wieselman is not the attorney of record for either Anne OR Wes in the civil case). Was Wes Rhodes planning, back then, to claim "ineffective assistance of counsel?” And what would be the implication now? Is that what he meant, when he told a policeman, just earlier this year, that his "civil rights had been violated" and that he was "going back to court?” You really have to wonder.

On top of all that, what angered us was a suggestion by Mr. Wieselman that Wes Rhodes' actions may have affected fewer people than fifty--fewer than we, his former clients, know they did. I'm talking about the following exchange, between The Court (i.e. Judge Haggerty) and Jack W.

"THE COURT: Now, for purposes of sentencing, the Government says they are going to seek an enhancement based on a number of things. First of all, that there were more than 50 victims. Do you acknowledge that in these transactions there were more than 50 victims?

MR. WIESELMAN: Your Honor, if I may. That is to be yet determined. There is a parallel SEC proceeding in which a number of victims -- the full amount of the loss, et cetera, is being thoroughly investigated at this time. Until we have further information, we're not prepared to acknowledge that enhancement."

And of course there were way more than fifty people IN THE COURTROOM even then (and have been at all important Wes Rhodes' hearings since--and if we keep our health and strength, there will be more than fifty present for as long as it takes!). Surely Mr. Wieselman could see that with his own eyes? How could he suggest we might be fewer than we knew we were, we wondered! So, as we celebrated later that "guilty" plea (with a bit of a party and even a Wes Rhodes' trivial pursuit game!), we still had qualms. Anyway, be all that as it may, the sentencing was set for Nov 14, 15 16, which felt, at the time like a long way off. Nevertheless, we felt sure, after a "guilty" plea, that the hearing would happen, and believed that our F.F. would be in jail by Christmas 2007, or shortly thereafter, so that we would have "closure" in a bright New Year. Oh, how naive we were! And how little we knew (and, yes, I speak for myself--but I think other AIs would agree with me that, at the time, we were "wet behind the ears" in our optimism)!

Well, shoot. I think I’m going to need another day. Sunday is usually “blog fun day.” But I reckon I’ll use most of tomorrow, June 1, to get to the end of this summary. I think

I’ve done enough for today, don’t you? I hope this recap is useful. It is for me, anyway. And it’s my blog. So nyeh, nyeh, nyeh, nyeh, nyeh! See you tomorrow.

Sunday, June 1, 2008

Wes Rhodes, the post September 2006 history (6)

Before I continue with the Wes Rhodes’ post-September-2006 saga here, I want to welcome readers to the month of June. If we discount for a moment the first few days of October, 2008 (remembering that the sentencing hearing is currently scheduled to begin on 10/6/08), that means we have four whole months to go. And yes, I agree--that’s one heck of a long time, bearing in mind that our F.F. pleaded guilty in the criminal case (after months of investigation) at the beginning of August, 2007. But we old Rhodesians have not only learned cynicism (in that we now know how thoroughly a white collar criminal--especially one with access to money [even though that might be someone else’s money--and currently, of course, that includes the taxpayer’s] can manipulate even our excellent justice system), we have also learned patience; we know we will get through the next four months with strength, unity and determination. And will the October hearing actually take place as scheduled? Well, it’s probably fair to say that at this point, nothing would surprise us. But I for one am determined to remain optimistic at this juncture that Judge Haggerty might by then feel that he has made every possible concession thus far (as Judge Mosman maybe felt after the early stages of the civil case) in order to be absolutely fair to the demands of the defense, and that surely, as Judge Mosman seems perhaps to have done by the point in the saga that I left off yesterday (and clearly I have NO idea how any judge thinks and feels--I can only hope), Judge Haggerty too, in his decisions, will begin, perhaps, to acknowledge that what seem to us to be “excuses” and prevarications must at some point stop and that justice must prevail. I have my fingers crossed.

Today’s picture? Clearly number three in my talented photoshopper friend’s “Wes-Gatorman” series. And this time, perhaps, a further job suggestion. You recall that, according to the recent terms of our F.F.'s release, he is supposed to seek employment? We have already offered a few pictorial suggestions (and there will be more to come). And what better place for a slimy creep to work than among other slimy creeps (with apologies to alligators)? We hope, of course, that his fellow slimy creeps would do him no harm, should he take up this particular suggestion. Really. I mean it.

Anyway, we left off at a point where Wes Rhodes had pleaded guilty in the criminal case, though with wording that left us a tad unsure as to his meaning or intention. What I forgot to mention yesterday was that, by this time, Mr. Wieselman (who had, as I DID mention, failed to persuade Judge Mosman to allow a “left over” $40K from Rhodes'

Schwab One account to be used to pay HIS fees, had applied to become “court appointed” in the criminal case. This so-called “CJA” appointment was signed by Judge Haggerty, effective July 24, 2007. I’m sure Mr. Wieselman was glad to be getting SOMETHING (and remember that we “victims” are also taxpayers, of course, so, in a sense, we were and are STILL paying for our F.F.’s criminal defense, though not as directly, and not as much).But back to that August 7, “guilty” plea, the news of which was briefly covered in various newspapers, including a short follow-up in Willamette Week and in various Pamplin media group publications, including the West Linn tidings, where a short, sharp piece by Dan Itel on August 8, 2007, drew several reader comments including the following, written on August 11, 2007 (I haven’t corrected the spelling, though I am shocked that a “politician” would make such mistakes--hmmm!): “I have known Wes for many years, he was one of the finest men I ever met. The above reader posted that the proverbial book should be thrown at him. Wes was a very good man who slipped into sin a little and the only book that should be thrown at him is the book of The Lord. The Lord forgivs Wes, I do, and so should all of you. Now I am not going to say who I am, publicly, becuase it could ruin my political career, but please take into account his long hard journey that it ahead of him and his loving family. Kepp them in your prayers.”[Signed] "Hate the sin and not the sinner"

Need I add that some of us--yes, I admit I was one!--suspected that the author of this letter might perhaps be the very same person who’d written the “A.S.S.” letters, and might not actually be a “politician” at all?

Nine days later, stock markets around the world tanked (August 16). And that spelled extremely bad news for us all. The very next day, at the Bonham’s and Butterfield’s auction on August 17 in Pebble Beach, 19 of those “muscle cars” were auctioned for $1.9 million (with none of the expected foreign buyers participating--along with others, more locally grown-- I understand) which was disappointing to Bonham’s, to the Receiver and, of course, to us old AI’s, all of whom had hoped for a lot more. There were, of course, still half a dozen other cars (“exotics,” is that the right name?) for sale here in town, in particular at Gran Prix Imports in Wilsonville. But I have to say that we had all wanted more for those “muscle” guys. Still, as the Receiver himself had pointed out in a report I quoted earlier, the worth of such vehicles varies according to all kinds of factors (obviously including market vagaries)-and, of course, one of the huge problems with Wes Rhodes’ collection was that some of these “fabulous” items apparently turned out to have been “clones,” rather than the real deal, as we'd been led by the F.F. to believe they were (rather like their owner, shall we say?).

It will be no surprise to readers to learn that, on September 26, 2007, the third anonymous (A.S.S.) letter was circulated to the same, non-inclusive but large, list of old Rhodes’

investors as before. And that this one was full of accusations of conspiratorial dirty deeds by, amusingly enough ("amusingly" only in this one way, I mean), a trio of folks at least TWO of whom had never met. Please go back to the blog posts for October 13 and 14, 2007 again; I don’t want to spend any more time on that vile garbage here.

Besides, new excitement was brewing. Although Wes and Anne Rhodes had secretly (as far as the Receiver etc were concerned) bought a new house in Oregon City, and, also secretly (ditto), had moved out the “better” furniture and art-work from their previous Mountain Road, West Linn, home, they had nevertheless left a ton of stuff behind, in addition to the confiscated (and now sold) cars. This “stuff” was scheduled for auction by James Murphy on September, 29. Many of us looked forward to attending, and poking around (including folks like myself who had never seen the Mountain Road premises, or the “museum,” called Crossed Flags, before).

Once again, Wes Rhodes sought to delay proceedings. In perhaps the most ludicrous use of the word “emergency” I’ve ever heard, our F.F. had his attorney Jacob Wieselman present an “emergency” motion to the courts the DAY BEFORE the auction was due to take place, requesting that certain items be withheld (once again, in my growing cynicism, I believed, rightly or wrongly, that this was an attempt to prevent the auction from happening at all). The motion claimed that the “Sale of the items will cause irreparable injury to the Defendant and his family. They are of little pecuniary value yet hold sentimental value to the family and cannot be replaced.” The list included various items, some of which may or may not have been family heirlooms which had, alas, fallen into Wes Rhodes’ irresponsible hands and which he and he alone had therefore, in my opinion, put in jeopardy when he chose to steal other people’s money. They had also BEEN LEFT BEHIND WHEN HE MOVED, like so many discards. Remember that he had bothered to take a hugely heavy lion statue on a marble plinth, which suggests to me where his priorities were. But some of the items really made us puke, by their totally “non-emergency” nature. They included, for example, a “Barbie Lunch box” (an emergency motion--which costs taxpayer AND receivership money--for THAT?) and some old clothes, described thus, in what, again, seems to me to be a puke-worthy attempt to get sympathy:

136…Coat…Personal worn from teen hood.137…Coat….Personal worn since young adulthood.138…Sweater…Personal, worn, moth eaten.364…Base Ball…Personal Gift. I have had this for a long time.370…BB Card… I’ve had this card since I was a child.371…BB Card…Same as 370.374…Base ball…with hat. I’ve had this for a long time.400…Base ball picture that my Grandfather gave to me; Family heirloom.

401…Base ball picture. Personal gift.402…Base ball picture. Personal gift.403…Base ball picture. Personal gift.405…Base ball picture. Personal gift.407…Baseball picture. Personal gift.471…Base ball jersey I bought and had signed years ago.474…Coat…Personal worn…zipper broken.475…Old baseball jersey. Moth eaten.

Well, I’ve said what I think. Remember that many of us had lost money to finance our LIVES, and our children’s LIVES, and their EDUCATION. And we were supposed to give a two-penny damn about a Barbie lunch box and a moth-eaten baseball jersey? But I’m going to reproduce here a comment from an old Rhodes’ investor we all know as “Susan,” because she expresses what I know to have been common feelings much better than I can (readers are also reminded that Wes Rhodes referred to Susan as a "vendor" of NOS parts in his deposition, under oath, given on May 25, 2006, a claim which, like other folks he asserted, under oath, were "vendors," she vigorously refutes):

"Now, to Wes's emergency list of pulled items, those of "little pecuniary value" but the "loss of which will cause irreparable injury." Wow, I loved the descriptions "coat-personal, worn since young adulthood, sweater-personal, worn, moth eaten.” So many family heirlooms. I'm picturing a Dickens-type character (please sir, I want more...) So many tailored descriptions to represent Wes as an avid family man and to elicit tears from people with compassion. Sorry Wes I'm not buying it. Let me tell you about irreparable damage Wes buddy. It's the horror of dealing with a dying precious child, trying to keep a job while trying to care for her, as well as the rest of my family. It's having you call me on a regular basis to ask me how my daughter is doing, and assuring me that when the time comes when I had to take a full leave from work to care for her full time, my investment money would be there to support me. You told me more than once "you just worry about your daughter; the one thing that you don't have to worry about is your money. I'll worry about that."Great job Wes. So in addition to the much greater tragedy I was (and am) dealing with, I got to find out that you stole my lifetime savings. My ability to trust anything, life, people, and my own judgment has been irreparably damaged. You know, life happens, cancer happens and death happens, and sometimes we have no control over that course. But you made conscious choices, you son of a bitch. You chose to cause irreparable injury to so many people who trusted you.Tell ya what Wes, give us back our money and we will give you back your fucking lunchbox."

And you know what, dear readers? I’m going to leave this saga right there, on that strong and powerful note. Yes, I’m not even going to talk about my usual Sunday stuff. I’ll be back tomorrow, with the remainder of this “potted” tale. Until then, if you do nothing else today, please read, and re-read, Susan’s remarks, and understand why we “old Rhodesians” will stand strong together for the next four months, or for however long it takes until Charles Wesley Rhodes, Jr., Wes Rhodes, the Fat Fuck, is held firmly where he can do no more harm, in jail. Wes Rhodes was a “good man, who slipped into sin a little?” “Anonymous politician,” and stupid “A.S.S.,” give up, and give me a break.

Wednesday, June 4, 2008

Wes Rhodes, the post September 2006 history (7)

I’m really going to gallop through the rest of the Wes Rhodes’ post September-2006 saga, I promise. I want to be done with it, quite honestly, though it's been really useful to recap (Which is worse, do you think? Living it and writing about it at the time? Or forcing oneself to think about it again? Hmmm. Tough choice.). But, for the benefit of recently acquired readers, I am going to try to catch up completely with where we are today. And then I think I’m going to put the whole thing together as a linked-in document so new readers can read it any time and I don't have to tell the whole thing over again.

So, here's where we were: the auction of “collectibles” of various kinds took place as intended on September 29, 2007, at the old Mountain Road digs, home of the famous “Crossed Flags” museum (or as frequent commentator Greg Weld calls it, a “shed”), and the gallant and fluent James Murphy auctioneers made over $175,000.00 for the Receivership estate (They would later hold an auction of the Rhodes' office furniture and office computers etc which made almost $20K). And after all that excitement (particularly the notion of Wes Rhodes' attempt at an "emergency motion" to get back, among other things, a Barbie lunch box and a moth-eaten baseball jersey--some freakin' emergency!) we all sank back into what we thought was waiting mode, with that November hearing getting closer and closer.

Then, out of the blue, we heard from the Merrihews that someone had informed them of the existence of a secret storage unit (October 16, 2007) and, yes, even produced that very same Alienware computer that Wes Rhodes had claimed to the Receiver did not exist. Naturally, the Receiver acted immediately; an order to show cause why the Rhodes’ should not be held in contempt was issued on October 18, and the Rhodes’ duo made to appear before Judge Mosman on October 19, at a contempt hearing, at the end of which they were searched.

(Note: we old investors did NOT attend that hearing, partly because we didn’t want to give Judge Mosman any reason to feel we were placing the Rhodes under any undue pressure, and partly because it all happened so fast it was over almost before it began. I did, however, obtain a transcript. In it was this fascinating assertion by the Receiver’s attorney, Peter McKittrick:

MR. McKITTRICK: Okay. Your Honor, with respect to the other violations, there's an ongoing obligation of cooperation and disclosure. Financial Forensics, the accountants hired by the receiver, has determined there's approximately $640,000 of money that was available to the Rhodes after the TRO had been entered in September of 2006. Some of that was from the Court's freeing up of the two accounts that the Court freed up for the use of the Rhodes for living expenses. Others were deposits that were made into their bank account. We've asked for an accounting of -- there is approximately $200,000 of that money that can't be accounted for, and we've asked for an accounting from Mr. Rhodes and have not received that.

Yes, you read that correctly; the amount given is not a typo. $640, 000 was available to them AFTER the TRO had been entered. And $200, 000 not accounted for. I can tell you now that most of Rhodes’ old investors would give their back teeth for a tenth of that. And so would most people in the WORLD. So it was pretty hard to understand how a man on whom a TRO had been issued had had that amount of money available to him. In just over a year. Shoot! It takes the breath away, doesn't it?)

Anyway, Judge Mosman, on the strength of that hearing, gave the Receiver and his staff permission to take possession of the contents of the storage unit and a couple of cars, and to search the Rhodes’ home (though I think the Rhodes did get there first, according to what I’ve been told--and I’d like to know whether the Receiver thought to dig up the back yard--maybe a few holes around that ridiculous golden lion plinth??? I’m joking, of course. Or am I? Seriously, I'm told they did actually look for signs of fresh dirt! But I bet my bottom dollar they didn't see everything--call me cynical if you will!). Here again, are the Receiver’s words, taken from his "Declaration in support of motion for order to show cause why C. Wesley Rhodes and Anne Rhodes should not be held in contempt," (I’ve substituted a “real” name for the expression “an,” or “the” “affected investor). On or about October 16, I learned from [Tim Merrihew] that C. Wesley Rhodes, Jr. maintained a storage unit at I-5 Mini Storage in Wilsonville, Oregon, located at 29722 SW Boones Ferry Rd., Unit #33. Tim had obtained a key to the storage unit from an acquaintance of Anne Rhodes' sons, who claims to have been given authority to access the Unit and had assisted Rhodes in moving personal property to the Unit. [Tim] informed me that records and assets of the Receivership entities were located in the Unit and provided me with an Alienware computer of Rhodes. On October 17, 2007, my staff accessed the Storage Unit and located numerous boxes of records belonging to the

Receivership entities, approximately $38,000 in cash, jewelry, a three-ring binder labeled "The Jewels of Anne Rhodes," three (3) Rolex watches, jewelry, and empty jewelry boxes, among other personal property items. Additionally, in the Storage Unit, they found a receipt for the renting an additional two (2) storage units at 17501 SE McLoughlin Blvd., Milwaukie, Oregon.

Needless to say, this was a whole lot of new information, with implications (including possible delays) we felt, for both aspects of the Rhodes’ affair in general (both civil AND criminal). By that, I mean that we old investors believed that acting in contempt in a civil case would NOT be viewed too kindly on the criminal side (where our old F.F. had pleaded guilty, remember, and generally been told to "mind his manners," as it were, while waiting to be sentenced). In addition, we had already just learned that Mr. Wieselman had filed on October 12 2007 for a “continuance” in the criminal case (he was asking at the time for ninety more days before sentencing on the grounds that the government hadn’t provided the defense with everything they needed. I quote: Although the Government intends to provide the defense with documents and the results of its investigation relevant to the issue of loss, no such evidence has been received as of this date. Obtaining and reviewing the Government’s evidence and conducting its own defense investigation cannot be completed by the currently scheduled sentencing date. The defense is currently completely unprepared to proceed to hearing on the issue of sentencing.) And that was without all this new discovery.

So on October 29, 2007, in the CRIMINAL case, before Judge Haggerty, Mr. Wieselman claimed that, with all this new evidence to sift through, and another big case of his own coming up (not involving Wes) he now very MUCH needed that CRIMINAL sentencing date to be “continued” (needed the continuance even more than he had thought on October 12, so to speak). The Judge agreed; we hoped, nevertheless, that maybe not the FULL ninety days would be given, but that perhaps a date might be set in, say, early January, right after the holidays. So it was with dismay that we learned that the scheduled November 14-16 dates we’d been waiting for with so much anticipation were now ‘reset’ to--not December, not January, not February, not March, but to April 2, 3 and 4. I can tell you, that felt like a very, very long time.

Back in the civil case, a full (my adjective) contempt hearing (following from that “quick” contempt hearing on October 19) was set for Wes and Anne for December 18, 2007 before Judge Mosman. We looked forward to attending again in large numbers, and did so, hoping to hear what our F.F. had to say about hiding all that stuff. Imagine our surprise when only Anne showed up, Wes having apparently been hospitalized for what rumor said was some kind of chest discomfort. The hearing proceeded, however, focusing on Anne; we learned that the pair had been selling and/or trying to sell furniture and watches, and that Anne had a diamond ring worth a cool $50+K that had apparently

gone missing (the “limerick fairy’s” winning entry from May 28, 2008, tells the tale better--and more amusingly-- than I can; for a complete and serious account, see the transcript of Anne's contempt hearing, published in this blog in eight parts, starting on December 22, 2007, and continuing on December 23, then for six days starting on December 26, 27 and so on). Much discussion ensued on what items in these sales, and attempted sales, had been Anne’s before the Rhodes’ marriage, and over three purportedly missing pages in their premarital agreement (which all by itself was a fascinating document).

Even more importantly, perhaps, from the point of view of our old AI-style cynicism, Wes, despite “chest pain” (or whatever), was well enough to be out of hospital within forty eight hours, and indeed hale and hearty enough to climb up a ladder on a cold December evening to string up electrical wires in order to light up a little outdoor Christmas Tree. Aw, we thought, isn’t that special!!?? We were so glad to hear that he was full of the spirit of the season, despite contempt, thievery, and an illness serious enough to keep him out of court, by his wife's side (his wife, whom he'd been telling folks he wanted to protect by pleading guilty--yes, the guilty plea was apparently to "protect" his wife, along with his mother, who, incidentally, had also been dragged into court because of his big fibs). Such a family guy!

[I’m going to get slightly ahead of myself at this point and say that a further contempt hearing was held for poorly wee Wes on January 4, 2008, at which his attorney Jacob Wieselman didn’t contest the contempt (not surprising, perhaps, given that Anne had already been found in contempt) and, while we were delighted to hear Judge Mosman also find our F.F. in contempt, we were a bit disappointed that he didn’t even get a tongue lashing. What’s more, the coercive sanctions applied really just gave us what we thought, in a sense, we already had. We did learn, however, that the hearing and contempt finding gave the Receiver the necessary authority not only over essential and hitherto missing documents, but also brought over $250K into the Receivership estate.]

And, you know, I’m going to end there again. I really WILL try to finish tomorrow. There’s not much left. But there was such a silly flurry of activity by our F.F. over the Christmas 2007/New Year 2008 period, I don’t want just to tuck it in here, as an afterthought. So see you tomorrow.

Thursday, June 5, 2008

Wes Rhodes, the post September 2006 history (8)

Well, it's back to that potted history again. And today really should be the last day for this post-September-06 account, I know. But I broke with my usual habit of writing straight onto the blog this morning, and, instead, dashed through the remainder of this saga in a Word Document that I can upload later. And I discovered that the rest of the tale really is still too long for one day, even though I tried to be quick and succinct (I know--an almost impossible task, for me). So I'm going to have to break it into three more parts (today, and two more). Sorry.

Anyway, here we go with this pre-penultimate extract (is that correct?). We had just talked about the two contempt hearings, remember (one just before Christmas 2007 (the link just shows one section of the transcript, but the rest is in neighboring blog posts) i.e., the one our F.F. sat out, or do I mean "lay out in a hospital bed" while his wife took the flak, and the other, where he didn't even have to listen to the list of "grievances," the way she had, shortly after). And I'd repeated the good news that the Receiver, because of the outcome of those "contempt" decisions, had brought over $250K into the “receivership estate.”

Of course to tell that, I had had to fast-forward a little to Wes’s so-called hearing itself on January 4, 2008 (if we can call it a "hearing," given that we heard nothing at that hearing from his sweet lips, actually--nor did we hear a hoped-for tongue lashing for our F.F. from Judge Mosman, who surely must, we thought, be pretty ticked off with our F.F. by this point, especially having bent over backwards earlier on in the case to make sure the little jerk had enough to live on and pay his previous attorneys. Remember that $640+K he'd apparently had access to? The IRA and the Schwab One account? And the over $200K "unaccounted for?” But the judge held his peace and simply pronounced the little turd "in contempt," and gave the Receiver permission to take charge of all that stuff). Incidentally, that date, January 4, ironically, was exactly ONE year after that “stalking charge” hearing down in Oregon City was scheduled to have taken place against “Margaret,” remember? Where the Rhodes dropped the ludicrous stalking charges, presumably because Wussy Wes had been subpoenaed to appear and take the stand? Such an anniversary! Especially in the light of what the F.F. Fiend has recently done (read the blog for a couple of days ago if you don't know, yet, about the "recycled tape" fiasco).

Anyway, to backtrack just a little to the end of December 2007. While the rest of us were writing Christmas cards and wrapping such gifts as we could still afford to buy, our F.F. had apparently been extremely busy on his own account. In his case, however, rather than spread messages of good will, he'd been producing a whole flurry of police and sheriff's reports (the details, and links, are given below) and writing at least one long letter (ditto). Kinda like one of those annoyingly smarmy, duplicated Christmas letters

you get from friends with "perfect lives and perfect children.” And probably about as honest!

It’s interesting to me now, when I look at the chronology of all this business. You have to remember that, apart from knowing about Officer Greg Johnstone's phone call to me on January 3 (read on), I had no idea of the existence of some of these other reports until after the bogus "shooting" report and my subsequent "interview" with DS Band, here in my home, on March 11, 2008. It wasn't until after that interview, and, later yet, learning that DS Band had written up a report, that I traveled down to Oregon City in early April to pick it up and, while I was there, asked if there were any others. I was astonished to discover there were. I didn't even know until then that there was an actual, official written report (reports, in fact) of the dog "trussing" etc., let alone the other stuff. And the sheriff's department report was a total shock. So the timing of the purported events didn't strike me fully until I started doing this "recap.” Now, today, I fully realize the significance (well, I think, "significance") of the fact that the "events" that were the subject of the first three or four of those police reports were asserted to have occurred right between Anne’s contempt hearing (when Wes was in the hospital with “chest discomfort” or whatever, for that exceedingly brief period) and his own. As though ex-investors--me, or people encouraged by me, or known of by me--suddenly, right then, out of the blue, after months and months and months, decided to make mischief. The more I think of it, the more bizarre that would be, as a concept. Why (if we were going to do something at all, which we weren't) would we do it then, and not before (at a time, perhaps, when anger was more raw)? See what I'm sayin'?

As with the “anonymous letters” (the A.S.S. letters) there are matters that can't, technically speaking, be proven, but the clues are there. In other words, we can’t of course “prove” that nothing ever happened to the little git over that Christmas period (astonishingly enough, there appear to have been NO WITNESSES to any of the dastardly deeds he was about to communicate to the police, either then or later). But I do know for a fact that I was mentioned as a “person of interest” in every single one of these stupid documents, either as a possible perpetrator, or an “encourager” of perpetrators, or as a person who “must know” who the perpetrators were, or organized the perpetrators somehow. And needless to say, none of those accusations was true. As I was also down in Medford--or traveling to and from-- when some of these things allegedly happened, or were reported to have happened, the accusations were additionally absurd.

But given that I’m pretty sure [because of the information in the reports themselves, and their inclusion of a blog post] that Wes Rhodes was truly ticked off by the fact that I’d implied on the blog that maybe his medical condition wasn’t as grave as all that when he'd failed to show up for that December contempt hearing, with his wife (my "opinion" being based on the fact that he’d been stringing up lights shortly thereafter), I now have

to ask myself whether that blog post itself, er, somehow--how can I put this?--gave rise to, or in some way inspired ALL those reports, and that Mr. Rhodes somehow thought that, by casting aspersions on the blog writer, right before HIS contempt hearing, he would somehow be showing the judge that he was the victim. And whether that in fact was his reason for writing, on December 24, a ghastly letter to me which he claimed was “personal,” and a kind of “reaching out,” but which in fact he had also actually appended to one of these totally bogus (as far as I’m actually concerned--and in my opinion, generally) reports in the first place, before I ever could possibly have seen it. See what I’m saying here? Just as the damned letter wasn't really about ME at all, but about the blog, and what that blog post had implied, did he somehow think those reports would--I don't know--mitigate his contempt in some way? And is that why they erupted right then? Just speculating.

As it was, the reports weren't entered into evidence (and I have no idea even if that was the F.F.'s intention), so the question is moot (one would have to assume that, even if that had been his intention, his attorney MUST have told him they would have absolutely no bearing on what he'd been doing since the TRO was issued). But it’s interesting, no? That after all those months of waiting, this little series of acts of mischief would allegedly occur right then? That his patient investors, who were probably way too caught up at that time in thinking about their own friends and family and Christmas in general even to spend as much thought on the little jerk as they otherwise would, might suddenly, en masse (well, a mass of three or four or however many it took to "do" those (imaginary things), commit naughty acts? Right when they KNEW he was going to have to appear before a judge, and were, indeed, looking FORWARD to that hearing? I mean, why on earth would anyone choose that time to commit silliness (and I can assure you that nobody was minded to do anything like that anyway)? Too weird, in my opinion.

Anyway, be all that as it may, Christmas Eve saw him writing this ridiculous letter to me, certainly to “press my emotional buttons,” I’m sure (whether or not it was also intended as a 'contempt mitigation device')--a letter which I shared immediately with the authorities of course, though I was WAY too upset to tell anyone else about it, for months. But that I did publish in this blog in four parts, parts one, two, three, and four, with responses, in case people are interested in reading or re-reading the vile schlock.

As to the reports themselves? On that very same day, December 24, as he wrote to me, he lodged a police report with the Oregon City police, saying that his tires had been slashed (and that I probably knew about it). He appended that “personal” letter to that statement (though, as I say, I didn't know he had, until months later). On December 27, he lodged a second report, saying that he’d “forgotten” to mention that, the same day his tires were slashed, someone (very possibly myself) had entered his back yard and tied up his dog. Yup, he'd FORGOTTEN to mention that before (would YOU forget such a

thing, if your dog had been trussed up like a chicken?). Incidentally, when I first reported this in the blog I stated, apparently erroneously, that the poor thing was a golden retriever, but then was corrected, and informed that it was a lab. Further correction has informed me that it is/was actually a Miniature Schnauzer. Heck, I guess I just couldn’t tell the difference! Needless to say (as I’m one of those folks who prefer dogs to people at times) I was particularly offended by this accusation (either as alleged perp, or alleged encourager of perp).

There was then a report with the Sheriff’s department lodged on 1/02/08, claiming our F.F. had been run off the road by a mysterious vehicle (mystery vehicles, or vehicle, have been a theme in these reports, now or later), and once again saying I must know who did it. In that one, he claimed my husband ran the blog with me, which made me laugh at least (my husband is still trying to find the information highway on a map). Anyway, as I say, I was not aware of any of this until Henry and I returned from Medford on January 3, to a ringing phone, and a police officer on the line, and the horrible letter waiting for me in the mail. Click on the links to read the blog entries for those days.

And I'm going to leave it there again. I made a promise ages ago to keep these entries shorter. I've failed horribly ever since. But we still have a bunch of days to go, and this whole Wes Rhodes' post September 06 story's so fascinating it's better to eke it out a bit. So, again, please bear with me; I'll continue tomorrow. See you then. (BY THE WAY--it's been a while since I mentioned those bizarre holidays we have. Today is Festival of Popular Delusions Day. Well, the events in those police reports--and those reports themselves--weren't popular with ME, at least! But as to whether they were based on delusions? Hmmm).

Friday, June 6, 2008

Wes Rhodes, the post September 2006 history (9)

It’s time to carry on with the penultimate chapter in the Wes Rhodes' post-September 2006 potted history. We are almost caught up with ourselves. So here we go (and a REMINDER, as we do, that today, June 6, is exactly four months to the date to the beginning of the currently scheduled October 6 sentencing hearing. Yeah! Just four months! Or, to put it another way, four whole freakin' months. Ah, well).

Yesterday, if you recall, we had left off right after that bizarre and, er, oddly timed series of police and sheriff's reports and that "personal letter" to me (all engendered and put together between "Anne's" contempt hearing and "Wes's" contempt hearing and which I therefore now wonder were perhaps originally simply contrived, collected, and intended, by our F.F. somehow as part of a putative presentation to "mitigate" the judge's findings

[and probably rejected as ridiculous and irrelevant by either the judge or Wes's then-attorney]? I know. I'm a cynical old bird. But can you blame me?). Anyway, by January 5, 2008, there were Wes and Anne, both in contempt. And the rest of us had settled back into our lives again, and were waiting, now, for the next event, which would (we thought) be the sentencing hearing in the criminal case, in April. Are you sitting comfortably? Good.

For, lo and behold, on January 12, 2008, some odd looking comments began to come into the blog, written by someone giving him/herself the initials F.A.I. And that seemed to me to stand for “fellow affected investor," i.e., the very salutation that old pusillanimous mouse turd A.S.S. (the P.M.T.) had used in those three anonymous, ridiculous missives back in July and September 07. These comments also happened to coincide with some new discussion of the "muscle cars," because those nationally (world?) famous auctions were beginning to take place at Russo and Steele, and at Barrett Jackson. So old F.A.I. had certainly developed, or redeveloped, a boil on his butt. Here's the first paragraph of the first comment, written in response to pdx70rt, who actually seems to know something about cars:

"What a wonderment, someone posting a comment who thinks they know something about the subject matter. I guess it's easy if you're preaching to the choir. There's an opinion out there placed on wondering if you "experts" know that a week and a half before the collection of cars was shipped to California, that there was an offer from a private party for several times what these cars pulled at auction? If true, why weren't we told this? Could it be a receiver who was serving himself instead of us? Have you seen the fee billings? Does this please you? A.S.S. and I have talked about this and THIS is what we're loosing sleep over.” (By the way, says Cate, I wish A.S.S. and F.A.I. could work out the difference between "lose" and "loose.” And, incidentally, I ask myself whether the "offer from a private party" was not, in fact, the same preposterous bid for around $14million that came from Oswego Luxury, based, we have learned, on an estimate written by antiques dealer John Hays, pretty much at the dictation of Wes Rhodes [Mr. Hays has stated under oath that he pretty much wrote down what our F.F.F. told him to write.] Well, don't you also ask yourselves the same question?).

Now, by then, I had a blog rule that folks commenting had to tell me privately who they were, via a comment marked "Don't Publish" (because, as you can imagine, a blog like this gets some pretty weird stuff, from time to time) and had instigated the system of "moderating" comments (which means simply publishing or rejecting them) rather than allowing idiots to write garbage, unchecked (I'm the only idiot allowed to write TOTALLY unchecked). But at that time I didn’t necessarily ask for a means of contact (I do now). So I left comments/messages on the blog for F.A.I. to give his or her identity. And I was gobsmacked when, in fact, he did just that. Or rather, it would be more

accurate to say that he gave "an identity.” In fact, he claimed to be the son of a real fellow affected investor whose name was very familiar to me. I think I can reveal now (as I’m using assumed names) that he claimed to be the son of the person I’ve been calling [Frank] in the May 25, 2006 deposition I’ve been transcribing (and will come back to). Remember [Frank]?

Given the contents of the comment, I did ask at least one person in authority what I should do, and, after an exchange of emails, decided that, although there were assertions in there that I disapproved of and hated and knew were lies, it was “useful” to publish them, if only to expose them for what they were, just as I’d published the A.S.S. letters. So I published the first one (click on the link). You'll see that the tone was almost identical to the A.S.S. letters, though F.A.I claimed to have been talking to A.S.S. (rather than actually being A.S.S.). The comments accused the Receiver of negligence again, and also made the old, tired, ridiculous accusations of shifty practices against the folks A.S.S. had likewise accused in his letters (including former investor Tim Merrihew and non-investor Greg Weld--who had by this time met each other ONCE, and ONCE ONLY, at that September 29 auction by James Murphy--I introduced them to each other, in fact). Further comments were forthcoming; I published one the next day, but refused another, and explained why, in a lengthy comment of my own. Finally, these things were so full of preposterous accusations that I decided that, without a means of actually checking the claimed identity (and of course I was, to say the very least, suspicious, and couldn't for a minute understand why any son of [Frank] would be making the assertions F.A.I. was), I ought to call a halt. And needless, to say, I had strong suspicions about who the commenter really was. And that kind of "weirded me out," especially after reading that December 24 "reaching out" letter.

In fact, I instigated both (a) the blog rule that I needed either a working phone number or an e mail address (which I'd never publicly divulge) for any commenter and (b) a rule that if ANY accusations were EVER to be made against a named third party on the blog , the accuser would also have to give his/her actual name, within the comment, beside the accusation. After all, nobody but a coward, surely, would accuse somebody by name and not give his/her own name? Talk about P.M.T.! And so the comments, naturally, stopped (without F.A.I. providing me with a means of contact).

In true "Miss Marple" mode, over the next few days, I did in fact find telephone numbers for the son of [Frank] and we had several interesting discussions, during which he assured me that he was not the comment writer and indeed had never read the blog. I believed him, absolutely. I mean, I left him messages, and he called me back, with alacrity, more than once. I don't think he (or anyone else) would have done so, if he was really F.A.I. (as I'm positively sure he wasn't).

So who, we wonder, was this person writing those very A.S.S.-like remarks? And claiming someone else’s identity to do so? Claiming the identity of an innocent party, the son of an "old friend" and "ex-investor?” Hmmm. I still wonder, don’t you? Or don't you "wonder" at all?

Well, there was enough excitement there for the whole of the spring season, in my opinion. What more could possibly happen, we thought?! Surely nothing!!

But once again, we were gobsmacked. Yes, towards the end of February, I was once again contacted by Oregon City Police department, regarding an "event" which was to engender the “mother of all police reports.” Yup. We've reached the amazing "incident at Walnut Grove alleged shooting" experience. In other words, I got yet another telephone call from OCPD (they probably have my number on speed-dial, at this point), this time from Detective Sergeant James Band (whose name must now be very familiar to all readers--just as MY name is now well-known to police and sheriffs alike, thanks to a man who claimed to be my friend for two decades). DS Band told me that Wes Rhodes had been “shot,” or claimed to have been “shot,” and that I had once again been named, not necessarily as the shooter, but as a person who must surely know who the shooter was (and might have, you know, encouraged the shooter). D.S. Band asked to come to my home to talk to me, which he did, on March 11, for a couple of hours.

He told me, among other things (read the blog post that describes the interview) that our dear F.F. has postulated the notion that one of his "angry" old investors might somehow be responsible (and that I would likely know who, and might even have approved or--how shall I put this? -- encouraged such actions; yes, criminal "Master Mind," me!! Just call me Cate Soprano!), and so he had asked Mr. Rhodes who might be most angry with him. Whereupon our F.F. mentioned three or four folks, including (you guessed it), Tim Merrihew, Greg Weld, and a guy named Todd Souvignier who actually lives in New Orleans. Fascinatingly enough, none of the three were around at the time (Apart from Todd, safely in Louisiana, Tim M was in Reno that day, and Greg W was in Seattle, where he lives). Nevertheless, the minute DS Band left, I called or e mailed all of them. By the time DS Band got back to his office, all three had contacted him. As he said, it was a rather amazing experience to have "suspects" get in touch with HIM, rather than vice versa, and volunteer information, so readily, and so quickly! I wrote extensively about the affair at the time, and included the police report; new readers should go back to the blog posts for that fascinating account in Detective Sergeant Band's own words. And the notion of any "shooting" was shown to be as ridiculous as we all knew it was, not least by the state medical examiner, Dr. Karen Gunson, and her colleague, Dr. Christopher Young. I quote: "Dr. Gunson said if the wound had come from a weapon or object, it most likely would have given Mr. Rhodes a depressed skull fracture. Dr.

Gunson emphatically told me the wound most likely came from a fall where his head struck something. Dr. Young agreed."

[And just a word (or 200), here, from the Blog Marm. In the first place, though I write about all this lightly (largely because all these various accusations are so preposterous that I refuse to be depressed by them), it is actually a serious matter, in my opinion, to be falsely accused, both for me in ALL these reports, and for the other folks mentioned in the "shooting" report. At my age, and with my good name at stake, to be called twice in a couple of months by the police, and be interviewed, face to face and at length at least once, is frankly disquieting. I am fortunate, to say the least, that Officer Johnstone and DS Band are persons of intelligence and integrity, and I'm sure the other people named as "persons most angry" would agree with me on that score. Secondly, it should be apparent to any new readers that, yes, of course, we are pretty angry (English understatement alert!) about what Wes Rhodes did to us all. Well, who wouldn't be? But we have had eighteen months or so to deal with, and work with, that anger, and to think about this man, who robbed us of our savings and, to a large extent, our trust and belief in other people. And, while we are vigilant, in the sense that we watch for new filings, and hearings, and stay active and make sure that we turn up in court, and file our victim impact statements and so on, WE ARE NOT VIGILANTES. We are not spying on Mr. Rhodes, or lurking in his neighborhood in mystery vehicles, or waiting for opportunities to drive him off the road. We are not--heaven forefend!--tying up his little dog. We've never sought out his nearest and dearest, or waited to ambush him or them, including on dog walks. I personally have never even visited the neighborhood where he lives, even to catch a glimpse (other than in a publicly available photograph) of his still brand new house. I've never given his actual address--though it is in public documents--on this blog. On the contrary, we are careful NOT to do such things. And why? Because we want Mr. Rhodes to feel the force of the law, and the weight of justice; we need him to take responsibility for what he did, and be answerable to us, and to society. We want to send a message to other white-collar criminals that the law takes these crimes seriously and that, here in Oregon, men like Mr. Rhodes can't get away with the awful things he did--crimes that amount to so much more than stealing money, because of the effect on his trusting victims and the generations that come after us, because of the destruction of health and strength, and family bonds, and peace of mind. So not one of us that I know would DREAM of attacking him, or his friends or family, or his property, or least of all (in my opinion) his poor little dog. Sure, I write the blog, and I make jokes and I use rude words and I say "my blood boils.” But truly and honestly, I'm a serious person. And I seriously want Mr. Rhodes to face the real consequences of what he's done, as we all do. And I would never, ever want anything or anyone AT ALL to make Mr. Rhodes himself a victim at this point, and nor would anyone else I

know. So the purported events that engender all this police report stuff, in my opinion, are sheer, unadulterated garbage, and an attempt by Mr. Rhodes to manipulate the situation once again--as he's been doing, in one context or another--for years.]

Okay. I know. That little "lecture" above wasn't really part of the post-September 06 history. But I think the fact cannot be overstated that we are law-abiding citizens. And that, while we are tired and, in some ways, feel frustrated at this long, long process, especially as we witness the continued egregious behavior of the F.F.F. and alien being, Wes Rhodes, and the way he has appeared, up to now, kind of to "get away with such things" (including what feels like intimidation and harassment to ME), we maintain our constant belief that justice will prevail; in fact, we rely absolutely on that belief, which is the thing that keeps us going.

Anyway, back to the subject: That April 2 hearing date was approaching soon. Surely, we believed, that court date, and the three days allotted to the sentencing proceedings, would signal an end to all these shenanigans.

But, oh, dear readers, our hopes were once more dashed, and that end was still not to be, as you'll see in the grand finale to this potted history (of the events so far!), in tomorrow's ultimate (yes, I promise, I promise, it really IS this time) episode. See you then.

Saturday, June 7, 2008

Wes Rhodes, the post September 2006 history (10)

**I'm sorry. But before I start today, I have to tell you I am SO EXCITED. Both my books are now available via both AMAZON and BARNES AND NOBLE, as well as MUTTS being at POWELL'S (online and at the Burnside store)! I'm just thrilled. This feels like SUCH a victory over Wes Rhodes, you know? So please, feel free (please!) to go there and write little reviews or something. Everything helps (I only get about 2 cents from Amazon and B and N sales, but never mind! It's frankly not just about the money; it's about making lemonade out of lemons, and saying "ya, boo, sucks" to the F.F. And all profits on bookstore sales are going towards MY bit of contribution to a post prison-for-the-F.F. party (veterinary type sale profits for MUTTS will go to good "doggy" causes, as via the Aloha Dog and Cat Clinic). I know I usually talk about this kind of thing on Sundays, and I WILL, no doubt about it. But I'm just so stoked I can't wait. Sorry.**

Okay, dear readers. We have honestly (I promise!) reached the tenth and--so far--final installment in the catch-up game we've been playing in the Wes Rhodes' post-September 2006 saga (what I've called the ASS years, for After SEC Shock, but also because the tale contained those wonderful P.M.T/A.S.S. anonymous letters we've been able to enjoy all over again (not to mention the F.A.I. comments, and the ridiculous accusations both in those screeds, and in the variously generated police reports, from the Christmas/New Year, between-contempt-hearings flurry, to the amazing "shooting" and the sling ("you put our right arm in, you take your right arm out") sightings. Anyway, these episodes are numbered (1) through (10) in the blog, and are therefore easy to search and locate (but I'll be making them into a proper document over the next day or two). And you can also go back to the BS (Before Shock ) account if you want to, to kind of set the stage.

And if, when you've read all that, you don't conclude that Wes Rhodes is an alien being, "you're a better man than I am, Gunga Din.” In fact, my only problem portraying our F.F. as a Martian, as per my talented photo-shopper friend's series (number 2 is shown here) is that, by all accounts, "Men" are from Mars. And I hesitate to call Wes Rhodes a man, in the generally accepted, "honorable and brave" sense of the word. But there you go.

So, where were we? Oh, yes, we'd just finished with the various shooting reports, hadn't we? Well, next thing we heard, our darling Wessy boy was wanting to sack his attorney again. Yup. John Carr had fallen off the screen way back in 2006, for whatever reason; then Michael O'Connor and Bob Weaver had bowed out in the summer of 2007 (ditto), with certainly some dispute by our F.F. going on about their fees. And now Jack Wieselman was to get his marching orders, though in the CRIMINAL case only. We learned on March 13 that the request had been filed on March 11, in a motion that mentioned that our F.F. would not object to Mr. .Wieselman's withdrawal and indeed WOULD NOT OBJECT TO A CONTINUANCE OF THE SENTENCING (well, duh!); the motion also stated, somewhat redundantly perhaps, that he was not currently incarcerated (more's the pity, we thought!). There was a request for an ex parte hearing, but in the event, at the subsequently scheduled court date of March 19, Judge Ancer L. Haggerty simply agreed that Mr. Wieselman could step down (or whatever the proper expression is).

What really got our goat (the crowd of us who attended on March 19) was that, despite the fact that the notion of a “shooting” had been dismissed as nonsense, and indeed that any stitches incurred as a result of Wes Rhodes' "fall" (if fall it was, as Dr. Karen Gunson had suggested) must surely have been removed at that point (and that patients aren’t supposed to cover stitches with a bandage anyway, so far as I know) Wes turned up with a huge sticking plaster over the middle of his forehead and his arm in a sling, thus inspiring the interest of the judge. Read my account of the hearing by clicking the link.

And then supplement it by reading the transcript. For those who can't be bothered to do all that, just read the following exchange between Judge Haggerty, Jacob Wieselman and the government's Allan Garten:

THE COURT: All right. He appears to be injured. Has he been in an accident or something?MR. WIESELMAN: Your Honor, Mr. Rhodes was shot several weeks ago. The police in Oregon City at this point are working on the operating belief that one of the purported victims in this case, this is a financial case, may have taken a shot at him. He was hospitalized and treated but he's still recovering from that.THE COURT: An actual gunshot wound?MR. WIESELMAN: That's the belief, Your Honor, yes.MR. GARTEN: Your Honor, I don't want to get into a controversy over what transpired there. I think there's some dispute as to whether or not it was a gun shot or whether or not Mr. Rhodes fell into a ditch and his head was hit by some kind of obstacle in the ditch. I don't think it's relevant for the purposes of our hearing today, Your Honor.THE COURT: Well, I just looked and saw he was injured and I was curious.

What was so disturbing to us here was that the police were in fact NOT at this point working on the operating belief that one of our F.F.'s victims had shot him. And, moreover, there was simply no apparent truth in the statement that "Mr. Rhodes was shot several weeks ago.” Everything we had learned and read was that in fact our F.F. was NOT shot, and that nobody at this point believed he'd been shot (except, clearly, his attorney, who must simply not have talked directly to the various police officers and detectives concerned, one has to assume, or he would have known otherwise. What Rhodes believed or didn't believe about his own tall stories is anyone's guess). To be honest, it was really hard for us--well, for me personally--to stay silent at that point. But silent I remained. Though I did call Detective Sergeant James Band the minute I got home, just to confirm what I KNEW to be the case, and to make sure nothing had changed. This is what I wrote on the blog, and DS Band's actual quote, that very same day (March 19): "I called Detective Sergeant Jim Band of the Oregon City Police when I got home from today's hearing. Here is his on-the-record statement to me, at 1.40 p.m. this afternoon, Wednesday, 19 March, 2008: "I have now suspended this case. I know for a fact that Wes Rhodes was not shot. Furthermore, I have no reason to suspect that any of the affected investors were involved in any aspect of this case.” Yes, that quote was obtained the very same day that Mr. Wieselman had asserted in court that Wes had been shot, and that the police were operating on the working assumption that one of us had done it. The very same day. How could that be? I still don't understand. Do you? As I say, Mr. Wieselman surely must not have talked to DS Band. He must simply have believed his client, no?

Whatever the case, Judge Haggerty allowed Mr. Wieselman to withdraw, with no real reason given ("I'll grant the motion to allow Mr. Wieselman to withdraw. I'll appoint new counsel through the Public Defender's Office.") The name of Michael Levine was mentioned as a possible substitute (and, again, we were a bit surprised that a "guilty" party could sort of choose his court-appointed counsel--at taxpayers' expense, remember). And, of course, the fact was asserted that more time was going to be necessary to get the new attorney up to speed, which, jaded as we are, didn't surprise us at all. Thoughts of that April 2 hearing flew out the window. But perhaps the worst moment of all, for us old investors, was when Mr. Wieselman said, "I do want the Court to know going forward, Mr. Rhodes has been very cooperative. He is a good client. The nature of the relationship is such that I can't effectively represent him going forward, but I do want the Court to know that he has cooperated to the best of his ability with me.” Needless to say, we old Rhodesians had some, er, misgivings about those assertions and certainly wondered, if they were completely accurate, why on earth the relationship couldn't have continued (and, again, saved the taxpayer money, among other things) for just another couple of weeks. I mean, really--"cooperative," and "a good client.” Surely Mr. Wieselman could therefore have continued, even for a month? And surely Wes Rhodes, who had admitted guilt, and apparently knew he had to face the consequences, could have swallowed whatever misgivings he had developed with this, his third or fourth attorney, and saved both us and the taxpayer money by continuing with this "cooperative goodness" of his. I mean, Mr. Wieselman had been around, in one capacity or another for the family, for well over a year. And especially as Jack seems to have remained as counsel of record in the civil case, for both Wes and his wife. I guess I really, really don't have a legal mind, because the whole thing beats me.

But all that was not to be, and a status hearing was set for April 21. I had by now installed a countdown clock on the blog, which I have learned at this point, over and over again, to reset. Curiously, though it bugs me that I keep having to set those dates further and further out, its existence is strangely comforting; I love to watch those seconds scurrying down.

Meanwhile, our dear, dear Wes was apparently pretty angry that doubt had been cast in the courtroom on his veracity in the “shooting” assertions. On the way home, apparently (or very shortly thereafter, at 11.10 A.M.) he drove himself to the OC police station to complain that he'd just learned in court that the case was being suspended; reading the report, it sounds as though he felt DS Band had somehow unfairly "ratted" on him (those are MY words--please, again, read DS Band’s report of this new incident ). And on April 3 he made a phone call to DS Band with further complaints, followed, on April 6, by a personal appearance at the OCPD to file a complaint against DS Band, and complain that he now knew who shot him ("investors' kids") but wouldn't tell (SO THERE!). Meanwhile, the records officers at the OCPD front desk had observed, on March 19, our

F.F. remove his hand from his sling, take out his car keys and drive off (yes, after appearing in court with all those bandages, and having his attorney assert to the judge that he'd been shot); their reports on that viewing became publicly available shortly thereafter and are also here on the blog, to read.

Anyway, the status hearing did in fact take place on April 21, with Michael Levine in attendance. Mr. Levine claimed he would need at least six months to get “up to speed” if he was to be the new Rhodes' attorney. The government, as always in the shape of Allan Garten AUSA, tried to sway Judge Haggerty both to appoint someone with more available time upfront, and then to make four months suffice. Judge Haggerty asserted he didn’t think two months made much difference to us old investors (oh, how wrong he was!). The new hearing was therefore set to begin on October 6, 2008, and last a week.

That brief April 21 status hearing was attended by a reporter, Todd Murphy, from the Portland Tribune, who’d been talking to a few old investors over the week or so before. He and his photographer LE Baskow managed to “catch” our F.F. later, apparently, in a shopping mall near his home, and to take three priceless pictures of him fumbling to get his arm back into that damned sling. An excellent cover story appeared in the Portland Tribune on April 25. And I must admit that, try as I might, I couldn't help nodding my head at Todd Souvignier's assertion in that article: “We live in a country and a world where justice is a game,” he says. “And it’s a game that generally runs to the benefit of those with money. So our expectations for justice in this situation are, you know, low.”

But we keep on hoping and believing. On April 28, several of us turned up to attend a hearing with pretrial services to determine whether the F.F. should continue to be out on his "own recog," or whether there should be some restraints placed on his freedom. Between our arrival, and a moment about ten minutes before the hearing was due to start, a handwritten note was posted on the courtroom door to the effect that the hearing had been rescheduled for April 30. Further research taught us that, on that very same Monday morning, Mr. Levine had apparently discovered that he had to be in Astoria after all (I guess he must have found out quite suddenly, and not been able to tell anyone?). The hearing was held in fact on April 30, and Wes Rhodes’ new conditions of release determined. They were, of course, not so very different from the old conditions. He was once again free on his own recog, against the government’s protests (no home confinement, no ankle bracelet), the only real concession being that, though he has to find employment, it is stipulated that it should not be in the financial services industry (well, duh!).

And I have to add something here, cynic that I am. Given that I've now reported that Anne Rhodes actually left Wes very shortly before that time, I must admit (as I'd already heard the news of her departure from a couple of outside sources) that I was highly

surprised to hear that Wes Rhodes actually turned up for the hearing on April 30 at all (I was in England at the time, but obtained and published the brief transcript the very same day). And of course I had absolutely no reason to disbelieve Mr. Levine's account of being held up in Astoria on April 28. All I'm saying is that perhaps our F.F., in the circumstances, was grateful that he didn't have to appear so soon after his wife had fled. I mean, poor wee puppy might have been weepy, no?

In addition, I have no idea when our F.F. actually worked over the old "Margaret" tapes to give to his new attorney (and did he also get busy with the decal letters? Hmm. I don't know). But it was also around that time, given his recent appointment, that his new attorney confronted DS James Band with these tapes and letters and asserted, in his innocence and ignorance of the date of that tape at the time, that his client was being newly "harassed.” All I know is that "Margaret" and DS Band discussed the matter on May 6, 2008. And Mr. Levine was only officially appointed on April 21. So whether Wes Rhodes "reconstructed" the tapes (and letters???) right before Anne left, or right after, is not clear. But he was certainly not "working on his marriage" (if before) or "sitting home grieving" (if after). He must have been trying to embroil his new attorney in this new scheme right around that time.

Finally (yes, finally), I’ll just mention that we learned on May 19/20 that our dear F.F. was going at some point soon to have a psych evaluation, and had been told he had to keep taking the meds. Whether that's happened yet or not, I don't know. (And what does that psych evaluation mean for the case anyway? That “they’ll be coming to take him away, Ha, ha, Ha, ha, Ha, ha!?? Lord only knows).

As to the case against Anne Rhodes? Well, you remember that her case had already been reopened before her departure because so many of us had objected to the terms of a "settlement" between her and the Receiver --in my case, I admit, not LEAST because I suspected that funds in there were somehow destined, once again, to pay legal fees, and (although I certainly believe that legal fees should be PAID), I felt that we AIs had, unfairly, paid a bunch of Rhodes' legal fees in the past, or, perhaps worse, paid money intended for legal fees that may not have ended up even in the intended hands. Anyway, as I've said before, we assume that case will very likely be impacted by her quitting the marital home at the end of April, especially if reports are absolutely true--and have remained so--that she left "in the clothes she stood up in," (which to me implied she was leaving the whole THING behind). I'm sure there will be more news very soon. In any case, Judge Mosman has asked for a "status report" on the matter on July 1, 2008. But, as I say, I expect more details to emerge before then. And, as commenter Louis keeps stressing, I am very glad, for Anne's safety if nothing else, that she got out when she did (and even more so, if reports of the manner of her leaving, and her attitudes, are true). We shall see.

And that's that. We're there. And not before time. Just asking ourselves, "What's next?"

Incidentally, you'll perhaps be interested to learn that this “potted version” of the Wes Rhodes’ story has taken up some 25,000 words. To give you a sense of what that means, my two books, OF MUTTS AND MEN and MIRANDA AND HER DAUGHTERS, which are a pretty decent average length for standard novels, each contain only about three or four times that much (maybe 85K). In other words, this ten-part resume means I've written about 1/4th or 1/3rd of a "novel" in just over the past week (and let's face it--much of the material supplied from Wes Rhodes' mouth itself can be classed as "fiction!” GRIN). And remember, I’ve just given here the very, very briefest of accounts. We have four full months to go. I imagine--don’t you? -- That there will be many more tales to tell. Watch this space, dear readers! Watch this space.

Copyright © Cate GarrisonPortland, OregonJune, 2008