The "Free Capitalist" Roped In
As anyone who reads my blogs knows, I was always leery of the real estate boom. I've seen too many of them bust. By the end of 2005, I was warning anyone who would listen they were making long term investments with a short term upside. By the end of 2006, I was setting off flares. Nobody wanted to hear, and here we are.
During all those smoke and mirrors, people were either shoveling money in or getting others to shovel in. And they all had good excuses. Everybody was doing it (Which was nearly true.). There didn't seem to be anything wrong with it because it was all out in the open and no one was getting busted (Which was also true. TV, radio, and billboards were full of ads for strawmen and flips, and neither the state nor the feds seemed to be cracking down on it in any way.). And there was one company with a massive profile that seemed to be doing it all without any regulators saying "Boo": Franklin Squires. I tell you it was impossible in the face of all that to convince people to stay away from the game.
And of course the face, the brains, the man on the throne of Franklin Squires was Rick Koerber. And as things fell apart, a lot of the people who got into serious legal trouble seemed to be Koerber's alums. Yet Koerber himself was unscathed. In fact he got louder, directly challenging the regulators, at one point seemingly making the state securities division turn tail.
That was curious. And the reason was obvious. FIHP. Koerber had friends in high places. Specifically Herriman's own Carl Wimmer, who ran interference for Koerber and even instigated a legislative audit of the securities division when it had the temerity to investigate Koerber. You tax dollars at work.
Well, the legislature couldn't audit the SEC or the FBI or Brett Tolman's office. And now Koerber's indicted, and Wimmer is backstroking so fast I think he just burned Michael Phelps. I guess he wasn't too big to fail (And trust me on this, nothing is. Empires have failed. What makes banks and brokerages think they can't?).
Remember as you go down the road that there are certain truths that never seem to go away:
If it seems too good to be true, it is.
There's no honor among thieves.
There's always a bigger fish.