Rare Coin Auction Proceeds To Benefit Ponzi Scheme Victims
Nov 14, 2020, 5:36 PM | Updated: Dec 7, 2022, 12:14 am
SALT LAKE CITY — Officials said they planned to use the proceeds from the auction of thousands of rare coins to help the victims of a Utah Ponzi scheme to recover some of the $170 million in losses.
Thousands of gold, silver, and unique coins are currently being auctioned by Erkelsens & Olson Auctioneers in Salt Lake City.
“You typically don’t have this kind of product in one area at one time,” said Rob Olson, who owns Erkelens & Olson.
The auction was held online, instead of in person, because of coronavirus concerns and the limited number of people allowed inside the building at one time.
“It’s been strange,” said Olson. “I mean, when you sell with a microphone after 45 years, and all of a sudden there’s a pandemic that hits, you basically do a 180 in your business.”
The collection was expected to draw a lot of interest, not only because of what the coins are, but also where they came from.
The coins belonged to the owner of Rust Rare Coin in downtown Salt Lake City.
Two years ago, Rust Rare Coin was investigated by the FBI and the Securities Exchange Commission after its owners were accused of running a Ponzi scheme, money laundering, and defrauding at least 700 investors for millions of dollars.
Thousands of rare coins are currently up for auction. They’re from a downtown Salt Lake City coin shop where the owners are accused of running a $200 million ponzi scheme. We’ll have this story on our @KSL5TV 5 and 10pm newscasts. Background story: https://t.co/CqNTqvRlCs #ksltv pic.twitter.com/vkVecZJJz7
— Alex Cabrero (@KSL_AlexCabrero) November 14, 2020
“This was another one of those Ponzi schemes to the tune of around $200-million,” said Olson. “There was real estate involved here, there were quarter horses, I heard over a hundred quarter horses.”
Federal prosecutors said the Rust family who ran the shop tricked people into believing they were pooling money to buy and sell silver.
Instead, they were accused of using the money to pay other investors and for personal use.
One family member, 61-year old Denise Gunderson Rust, has pleaded guilty to money laundering and was sentenced to 18 months in jail and three years probation.
A U.S. District judge has also ordered her to pay $1.7 million in restitution.
Her ex-husband, Gaylen Rust, and their son, Joshua Rust, also faced federal charges.
Their cases were still going through the court system.
Olson’s company was chosen by a federal-appointed receiver to auction the items and raise money to repay victims of the Ponzi scheme.
“All this money goes back to the receiver who can then distribute that to people that have lost money and have really lost fortunes,” said Olson.
Victims probably won’t get everything back, but it’s something.
The auction ends Wednesday.