The father of St. George businessman and philanthropist Jeremy Johnson has asked a federal judge to return $1 million in silver seized from the dad’s home as part of a criminal investigation into his son’s online business.
Kerry Johnson argues the silver taken in July is his and not his son’s as alleged by federal prosecutors who are pursuing a criminal case against the younger Johnson over his operation of a company called I Works.
The government contends the silver was merely stored on the father’s property but actually belongs to Jeremy Johnson, who is facing a single criminal charge but also is the object of a continuing investigation, which could result in a new indictment.
The criminal investigation followed a civil lawsuit filed in 2010 against Johnson by the Federal Trade Commission (FTC) that alleged he used false testimonies and misrepresented products while also making unauthorized charges on credit and debit cards. His company took in about $350 million from 2006 to 2010, and Johnson pocketed around $48 million, according to the FTC.
Jeremy Johnson, noted for his philanthropy in Utah and Haiti, denies the allegations in both actions.
IRS agents raided Kerry Johnson’s Santa Clara home on July 22, 2011, after a magistrate signed a search warrant. According to an affidavit by IRS Special Agent Jamie Hipwell that was attached to the warrant, two witnesses said Jeremy Johnson showed them substantial amounts of silver, gold and other property he had stored in safes on Kerry Johnson’s property.
But in his motion to U.S. District Court in Salt Lake City, the elder Johnson said the $1 million worth of processed silver bars and coins had been a gift from his son in 2008, before any civil or criminal investigation had commenced.
"The documents submitted to this court clearly establish that the property is owned by [Kerry Johnson] — not Jeremy Johnson," the father said in a court document.
The U.S. Attorney’s Office for Utah declined comment. But in court papers, Assistant U.S. Attorney Jeannette Swent said the government believes its evidence shows that Jeremy Johnson owns the silver and that his intent was to make it appear he was penniless while hiding assets. Swent also pointed to Kerry Johnson asserting his Fifth Amendment right against self-incrimination when answering questions about the silver from a court-appointed receiver in the FTC case.
Kerry Johnson’s attorney, James D. Gilson, said his client disputed the government’s assertions and would file a reply with the court.
Jeremy Johnson’s attorney in the criminal case, Nathan Crane, also said the silver belongs to the father.
Court records show that agents also searched a bunker on the St. George property of Jeremy Johnson’s grandfather, Sheldon, for precious metals, coins and currency, and buildings at "Doomsday Ranch" in Hurricane looking for vehicles, boats and office equipment. Court records don’t reveal what came of the searches.
Twitter: @TomHarveySltrib #jeremyjohnson
Copyright 2014 The Salt Lake Tribune. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.