Pat Shannan's MUSINGS
The Goon Squads Are Running Rampant
There are now over 3,000 federal laws and 10,000 regulations being utilized by hundreds of thousands of bureaucrats, with over 80,000 of them carrying guns and diligently standing in enforcement. The United States of America is now a heavily armed national police state, little different from what the colonies finally broke away from in the 1770s. An enormous amount of political and police power has shifted from the state and local communities to the federal government over the past forty years. If a constitutional republic is desired and individual liberty is cherished, this concentration of power cannot be tolerated.
Congressman Ron Paul of Texas points out that the careless attitude of Congress about the federal bureaucracy and its penchant for incessant legislation have prompted serious abuse of every American citizen. However, Dr. Paul does not mention something that he knows better than any of the other 534 critters on the Hill: that as long as the power brokers have legal tender manufacturing rights at their finger tips, nothing will change.
Getting illegally seized property returned is difficult, because the owner is forced to prove his innocence in order to retrieve it. Even though many innocent Americans have suffered, these laws have done nothing to stop drug usage or change people's attitudes toward the IRS. Seizures and forfeitures only make the problems they are trying to solve that much worse. The idea that a police department, under federal law, can seize property and receive direct benefit from it is an outrage. The proceeds can be distributed to the various police agencies without going through the budgetary process. With such incentives, what sheriff or police chief would not be motivated to send out his goon squad in order to be driving a new Lincoln next month.
The national-police-state mentality has essentially taken over crime investigation throughout the country. Our local sheriffs are intimidated and frequently overruled by the national police. Any chore more difficult than writing a traffic ticket prompts swarms of federal agents to the scene. We frequently see the FBI, DEA, CIA, BATF, SEC, IRS, Fish and Wildlife, federal marshals, and even the U. S. Army involved in local law enforcement. They don't come to assist but to take over, and often without an invitation from the locals.
Legalized Theft
Everybody knows the victim of at least one of these horror stories. I could even tell you a personal one from 1986. But the story of The Cornerstone Prodigy Group, Inc. and its founder, Gary Reeder, is my current favorite.
Reeder, 55, is a fast-moving businessman with innovative marketing ideas. It would be fair to say that he was a victim of his own naivete. In 1999, he still idealistically believed that if one is honest, helps others get ahead, and breaks no laws while doing it, then in this great land of the red, white & blue, the success chart has no ceiling and the sky is the limit. It is an understatement to say that Gary Reeder is a big thinker. With his unique marketing technique, he was putting gold in the hands of the ordinary American at a fast rate through a clever leveraging program. He demanded that the Cornerstone system be scrupulously honest and at every crossroads vigorously embraced the adage that "if it is not a good deal for all parties, it is not a good deal."
However, he was not aware of who Public Enemy #1 is in this country. Nor was he cognizant of the king's unwritten but inviolable law of Thou shalt not mess around with the gold, the oil, the drugs, nor the money, lest thy ox and thy ass become mine.
Never considering that "Caesar" doesn't like for his little peon subjects to own real money, Reeder expanded in a short time to a weekly gross of $2 million. His company bookkeepers were in a pencil-pushing frenzy getting out over 6,000 checks each month, in order to honor Cornerstone's contractual agreements with its customers.
There were no complaints from anyone. Matter of fact, all were deliriously happy. All that is except one bureaucratic clown from the Security Exchange Commission who decided one day that this contract by The Cornerstone Prodigy Group and its gold buyers must be violating some securities law somewhere. A "fishing expedition" was quickly organized.
And in its typical menacing mindset of why just ruin a guy's business when we can ruin his holiday, too, the government goon squad swept into Cornerstone's Fort Worth offices on the day before Thanksgiving of 1999 to pull off their heist. Conveniently, they brought along the news and camera crew from the local NBC affiliate station in a ploy designed to flagrantly demonize Reeder and his wife into wanton criminals in the eyes of viewing public. There was no search warrant issued and the gun-toting raiders ignored the parameters of the Temporary Restraining Order and took whatever they wanted, including a favorite picture of Gary and his wife vacationing on the beach in Grand Cayman Island - proudly displayed on the boss's desk. Their half million dollar home and its contents, along with their automobiles, were confiscated and sold, before the Reeders were allowed a weekend to pack their clothes and make alternative living arrangements.
There was never a victim to this alleged "crime," but only the allegation that a victim might be identified at some point in the future if certain conditions prevailed without intervention by the United States government. Big brother at work protecting the citizenry! The action identified by the government and media was stated as an "emergency relief action." The emergency cost the Reeders and their friends at Cornerstone over $1 million in legal fees, plus the loss of revenues earned in interest on more than $7.5 million held in trust by the court-appointed Receiver, Michael Quilling as well as the revenue that would have accrued during the period of litigation and since. With the $2 million a week in reported revenue and approximately $700,000 in reported weekly disbursements, the company was extremely liquid.
On the TV news that night, Gary and Sandra Reeder saw themselves portrayed as flim-flam artists who had fleeced their clients out of some $16.5 million. They learned that they had opened bank accounts in Grand Cayman Island in preparation to flee the country and saw the picture of themselves on the beach during this trip depicted as "evidence" that they had made this business trip. The report did not mention that the Reeders did not even possess a passport, and the truth was that they have never had a bank account in Grand Cayman or any other foreign country.
When the office safe was opened that Wednesday, the TV camera crew filmed the $1 million in silver and platinum. They also reported on another $6 million taken from the Cornerstone bank accounts, which had been on deposit for delivery to honor contracts with purchasers, incorrectly reported in the news story. After all, the government spin was that these people were big time crooks, and KXAS-TV did nothing to alter that in the minds of its viewing audience. In fact, the report appeared to be doing about all it could to enhance the lie.
Says Reeder, "It should have been obvious to any truth-seeking news crew that the Cornerstone personnel were simply enjoying another successful day at the office and that there were no plans for anyone to abscond with anything to anywhere. The truth is that this was legalized robbery, as the results later showed."
When the various news agencies reported the findings of their "investigative journalism," Reeder says that they served as no more than a mouthpiece for the government. The Reeders' were called "thieves" who had perpetrated a "$16.5 million theft," targeting individuals throughout the world via a website and "boiler-room" tactics among other fraudulent techniques. However, the offices of Cornerstone Prodigy Group, Inc. occupied 8,500 square feet of plush space and nothing but the very most sophisticated methods of conducting business were employed. The books prepared by Ruth Ann Martin, Cornerstone's bookkeeper and the sole complainant for the government, identified approximately $12 million of disbursements to Cornerstone clients. These books were available to the reporters.
THE PLOT THICKENS
The anchorman for KXAS-TV was and still is Mike Snyder. His father-in-law is Don Shelton, who kept a desk in Cornerstone's offices as president of one of the subsidiary companies, Tri-Vector Pictures. Shelton mysteriously tendered his written resignation on the morning of Wednesday, November 24, 1999 - only hours before the raid. Jay Gray, a KXAS reporter on the scene on the incident, stated that they had "been working on this case for two months" prior to the break-in.
When the armed goon squad came in, they herded all the terrified employees into the conference room and held them captive for several hours. Only bookkeeper Martin was allowed to immediately leave. The record now shows that she had been previously granted immunity in exchange for her testimony against Cornerstone and Gary Reeder.
As stated in the original complaint, Ruth Ann Martin swore that the Reeders' traveled to the Cayman Islands and opened a bank account at the bank of Bermuda; the government and various news media concurred, but failed to identify an account number or title of such an account, a bank balance, or a single transaction to corroborate said claim.
Yet the Reeders were said to have diverted investor funds to at least one bank account in the Cayman Islands at the Bank of Bermuda. This allegation was made under penalty of perjury by Karen Cook, an attorney for the Securities and Exchange Commission. Karen Cook lied under sworn oath and the news media personnel make the mistake reporting her lie as "fact." It would come back to haunt them.
No criminal charges were ever filed, indicating again that the SEC was on nothing more than a fishing expedition - and didn't catch a single fish. Cornerstone was sued civilly by the government. Ten months passed before Reeder discovered that Michael Quilling, a Dallas lawyer who was the court-appointed receiver in the case and in charge of the millions in assets, had been earning over $100,000 a month in interest on the deposits - a total of $1.2 million in ten months, according to Quilling's own figures. When Reeder brought this to the attention of the court, Judge Terry Means replied in anger, "You bring that up one more time and I will find you in contempt!"
Just exactly how and where these interest funds were distributed was kept secret, which set the Cornerstone clients to wondering if Judge Terry Means had been deriving benefit from this monthly windfall. His threatening caveat to Reeder in the courtroom served only to increase these suspicions of duplicity on the part of the judge.
Undercover Violence
During this ten-month period and continuing after the settlement, Mr. Reeder found himself hounded by mysterious individuals who followed him everywhere he went. Once, when he was jammed in Fort Worth traffic, the car in front of him slammed on brakes and stopped quicker than Gary could and was rear-ended by Reeder. A trailing police car immediately blue-lighted Reeder.
But my, my, what a coincidence. The guy who had slammed on brakes in front was a Fort Worth cop. Bad luck, huh? You know, rear-ending a cop, of all people. Hardly. The car behind just happened to be another cop, and four others quickly arrived. It was a classic set-up similar to those used by insurance scam artists.
Mr. Reeder was taken to jail and booked for DUI. When he begged for the Breathalyzer test, the cops did not comply and entered into the report that he had refused to submit to the test. Fortunately, this was all captured on videotape, and the case was thrown out of court several months later, long after Gary had been squeezed for another $5,000 in legal fees.
In another incident in June of 2,000, Reeder was run off the road in a high-speed chase, sustaining a broken neck and a dozen other injuries. Only through quick-thinking of a nurse on the scene and helicopter trip to the hospital by MediVac did he miraculously survive.
Suit for Half Billion
After nearly a year of litigation, Reeder could see the quickening depletion of his company's assets, allegedly being spent for "legal fees" - the government's - and realized he needed to bail out with something. He pondered the SEC's extortion offer of 48 cents on the dollar, along with the agreement that he would not sue them for their transgressions. Reluctantly, he accepted in order to begin rebuilding his decimated company.
However, with no restraining clause in the agreement to prevent an action against those who defamed him and his wife publicly, he later filed a $500 million suit against NBC TV and its Fort Worth affiliate, KXAS, Channel 5; the Fort Worth Star-Telegram; The Wall Street Journal; Yahoo Internet News; and the law firm of Michener, Larimore, Swindle [how appropriate!], Whitaker and Associates, LLP. Immediately after the suit was filed, Yahoo pulled the news report out of it posted archives.
God Gets Even
The Cornerstone story is replete with corruption and outrageous behavior, and someday a book will be completed with all the gory details. At that time our absolute favorite chapter, without a doubt, will be the one entitled "God Gets Even," or something similar. You get my drift, and I'll betcha' right now you can't read the rest of this story without breaking into at least the biggest grin you have reflected all month and maybe even an uncontrollable belly laugh equal to mine every time I tell it.
Here is what happened a few months into the story - in March of 2000:
The SEC, following the raid but prior to the civil settlement, had turned over all of the Cornerstone files to the Fort Worth office of the FBI, unbeknownst to the Reeders. They were attempting to create a criminal case against them.
Gary called SEC lawyer Steven Korotach and told him, "Steven, I want you to know that I am not going to sue you. You have destroyed my company but I cannot wallow in this bitterness any longer. I am washing my hands of you and putting you in God's hands. I don't forgive you for what you have done and I won't forget it, but I am just going to let you deal with God about it because I just don't have time anymore to handle all this negative. So you work it out with Him."
One hour later, a tornado - remember that one that ripped through downtown Fort Worth the spring before last? - smashed right through the upper stories of the Federal offices. The building hit the worst were those housing the Federal Bureau of Investigation, and the Cornerstone case - its computers, the reams of files and papers, everything pertaining to it except the stolen money - were randomly strewn and distributed across God-only-knows how many square miles of north Texas and maybe all the way to Oklahoma.
It is a good laugh but not the last one. Reeder and his associates are now being entertained by the quibbling of the lawyers for all the news agency defendants, as they attempt to figure out how they will settle this defamation suit. And the appointment by the court of the same judge - Terry Means - to preside over the new case seems to be more evidence of collusion.
"Meanwhile, if the steady growth of the federal police power continues, the American Republic cannot survive," says Congressman Paul. "The Congress of the 20th Century has steadily undermined the principle that the government closest to home must deal with law and order and not the federal government. The federal courts also have significantly contributed to this trend. Hopefully, in the new century, our support for a national police state will be diminished."
show along with Clay Douglas. Clay is our friendly competitor and stays on top of the current issues as well as anyone. We seldom disagree on anything, but during the dual interview on the Solomon Show, the day after Tim McVeigh's alleged execution, Clay made the remark that "Tim is now probably down in Argentina drinking rum and enjoying the beach, with plastic surgery and a new I.D."