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Taxpayers could foot the bill for FLDS assets battle

Published July 9, 2012 11:25 am

United Effort Plan trust • Utah taxpayers could get stuck with more than $5.6M bill.
This is an archived article that was published on sltrib.com in 2012, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

When the state of Utah took over the property trust controlled by Warren Jeffs, it was supposed to be a two-year project, tops.

Instead, it's mushroomed into the state's longest-running, most expensive polygamy-related endeavour.

"I had no idea what I was getting into," said Bruce Wisan, the no-nonsense, occasionally brash, corporate tax accountant at the center of the seven-year struggle for control of the trust. "I thought there were some important issues at stake … I actually thought I could make a difference."

With the now-epic case still unfolding, Wisan and his attorneys have found themselves without a full paycheck for some four years.

The bill now comes to more than $5.6 million — money Wisan now says taxpayers should kick in to help pay.

"It's tough for us to swallow," said Ric Cantrell, chief deputy of the Utah Senate. For that amount, the state could hire nearly 100 teachers. Or more than 60 Highway Patrol troopers. Or help bring nearly 3,000 people back onto the Medicaid rolls.

Wisan said he would pay back state money if he gets a court win that would allow him to sell trust property, but if he loses that might never happen.

Utah Attorney General Mark Shurtleff, who instigated the takeover in 2005, said Wisan took the job with the understanding that he'd be paid from the trust itself, and the state should "absolutely not" be forced to help pay.

The decision is now in the hands of the Utah Supreme Court, which could issue a decision sometime this month.

The debt illustrates the deep divisions and strange twists at the heart of the saga.

Seven years ago, Jeffs was on the lam, about to find himself on the FBI's 10 most wanted list for allegedly forcing a 14-year-old girl to marry her 19-year-old cousin. Other former members of his polygamous sect, the Fundamentalist Church of Jesus Christ of Latter-Day Saints (FLDS), were suing, including a group of young men, so-called Lost Boys, who said they were forced out to reduce competition for wives.

Those suits were filed against the approximately $114 million United Effort Plan trust, which sect members had built with their donated money, time and effort since the 1940s. Their houses, jobs, even their food were all part of the trust. Like plural marriage, the communal living fulfilled an early Mormon principle, but as Jeffs excommunicated men from the group at an unprecedented rate, former members said the trust also acted as something else: a club to keep people in line. Disagree with the leadership, they said, and members could lose everything.

Shurtleff moved to freeze the trust assets and suspend the trustees in May 2005. At his office's suggestion, 3rd District Judge Denise Lindberg appointed Wisan, who had dabbled in receivership work, to do the job.

Things seemed to go smoothly at first. The trust was rewritten to remove religion and Wisan recaptured some property leaders were apparently trying to shift out of the trust and sell.

The FLDS people ignored him. Many moved away from the twin border towns of Colorado City, Ariz., and Hildale, Utah.

That changed in late 2008, after a massive raid on the FLDS property in Texas, the Yearning for Zion Ranch.

The sect started to fight the takeover in court, and they fought hard. At last count, there were as many as 30 separate cases involving the trust, and attorneys have argued in front of the Utah Supreme Court nearly a dozen times.

Salt Lake City attorney Rod Parker has represented the FLDS in many of those cases.

"Catalog the property, get back anything that's escaped and deal with this issue of breach of fiduciary duty by the trustees … that was appropriate," he said. "To try to change this whole community … they should never have done that."

Sect attorneys blocked Wisan from selling trust assets. With no source of income and mounting legal costs, debt piled up. By 2009, Shurtleff recognized the situation was a "mess" and entered into negotiations with the sect, eventually agreeing to a plan that would return almost all trust property to the FLDS.

They promised to pay Wisan's bills, then about$3 million, but he protested and Lindberg rejected the bargain.

The episode cemented a deep division between Shurtleff and Wisan, one that would come up again last year, when Lindberg ordered the Utah Attorney General's Office to pay Wisan's bills.

By then, the debt had swelled to more than $5.6 million with the bills of more than a dozen attorneys, according to court documents accounting for their expenses.

In one of the case's odd twists, Wisan attorneys are both working on behalf of the FLDS by defending lawsuits against the trust and fighting against the sect to keep the trust in state hands. And that's not cheap — primary attorney Jeff Shields, who has put in near-daily effort on the case, bills at $325 an hour, according to court documents.

Shurtleff calls some of the expenses questionable, pointing to a PR firm with a lobbyist and attorney time used for reading books by former sect members.

"They're not doing anything to lessen the costs; in fact, they're adding to them," Shurtleff said. "It concerns me a great deal."

Wisan says his attorneys needed all the expertise they could get, and a PR firm was necessary because "the general public was not getting an appropriate picture of the trust and what I was trying to do and what I and my attorneys were trying to accomplish."

Another item of concern? The Wisan team hadn't accounted for those expenses until recently.

"No one is minding the store," Parker said. (Wisan said submitting expenses they knew wouldn't be paid was a waste of time.)

There's still a chance the FLDS could get the trust back. Early last year, a federal judge ruled the state never had any business taking over the assets of a religious group, however controversial, and the trust should go back to the FLDS.

Shurtleff and Wisan are appealing that decision.

If they win, the FLDS will likely end up paying for both sides of the fight as Wisan sells properties to pay his bills, and perhaps pay back taxpayers. If the state loses, however, it throws into question whether Wisan, or perhaps taxpayers, will ever get paid.

With that in mind, does Wisan feel he's made a difference?

"Ask me when I'm finished," he said. "If everything I did was for naught and I don't get paid, then no. If the trust property is distributed, and people as a whole are better off … and I get paid on top of it, then yes, yes."