PRIVILEGED AND CONFIDENTIAL ATTORNEY WORK PRODUCT / ATTORNEY-CLIENT COMMUNICATION
REPORT TO THE UTAH ATTORNEY GENERAL REGARDING ISSUES RAISED IN THE RULE 65 PETITION FOR RELIEF FILED BY MARC JENSON
From PAUL G. CASSELL, ESQ., and FRANCIS M. WIKSTROM, ESQ.
APRIL 21, 2014
SALT LAKE CITY, UTAH
TABLE OF CONTENTS: I.! OVERVIEW OF OUR INVESTIGATION. ........................................................................1! A.! B.! C.! II.! A.! B.! C.! D.! E.! F.! G.! H.! I.! Engagement as Outside Investigators and Scope of Investigation. .........................1! Facilitation by the OAG. ..........................................................................................2! Sources of Information and Limitations on Our Investigatory Authority. ..............2! The OAG Investigation of Marc Jenson and the Charging Decision. .....................4! Initial Proceedings and Jenson’s Early Claims of Improper Influence. ...................6! OAG Receives Complaint Regarding the Mt. Holly Development. ........................7! Plea Negotiations and Jenson’s Efforts to Directly Influence Shurtleff. .................8! Shurtleff’s Increased Involvement in Plea Negotiations. ........................................9! Barlow Extends a Felony Plea Offer That Includes Restitution. ...........................13! October, 2007: Nelson’s Recorded Conversation with Shurtleff and Jenson’s Visit to Shurtleff’s Hospital Room. ........................................................13! Shurtleff Instructs Reed to Offer a No Contest Plea. .............................................14! Jenson’s Plea Hearings. .........................................................................................20! 1.! 2.! 3.! J.! K.! L.! M.! N.! O.! P.! Q.! R.! S.! The April 3, 2008 plea hearing. .................................................................20! The May 1, 2008 hearing and the court’s rejection of the plea deal. .........21! The May 29, 2008 plea hearing and the court’s acceptance of Jenson’s plea. .............................................................................................23!
INFORMATION LEARNED DURING THE INVESTIGATION. ....................................4!
Jenson’s Meetings With Shurtleff After The Plea. ................................................23! Shurtleff and Swallow’s First Trip to Pelican Hill. ...............................................25! Shurtleff’s Meeting With Darl McBride After Returning From Pelican Hill. ........................................................................................................................26! Shurtleff’s Second Trip To Pelican Hill. ...............................................................26! Shurtleff’s Trips to California Become Known in the OAG. ................................29! XE Capital Foreclosure. .........................................................................................31! The OAG Took No Action Regarding Jenson’s Restitution For More Than One Year. ...............................................................................................................33! Jenson’s Bank Records Show Significant Financial Resources and Payments to Lawson During the Term of the Plea in Abeyance. ..........................34! The OAG’s Efforts to Pursue Jenson’s Compliance with Restitution Obligations. ............................................................................................................34! Lawson and the “House of Cards” Email. .............................................................36! i
T.! U.! V.! W.! X.! Y.! Z.! AA.! BB.! CC.! DD.! EE.! FF.! III.!
Litigation Regarding Jenson’s Failure to Pay Restitution And Jenson’s Efforts to Raise Coercion Arguments. ...................................................................38! The Jenson Restitution Litigation Continues. ........................................................38! The Mt. Holly Investigation and Filing of Charges. ..............................................39! Jenson’s Bail Is Revoked. ......................................................................................43! The OAG Imposes Conflict Screen Related To Jenson Matters............................46! Jenson’s Sentencing Hearing and Shurtleff’s Reaction .........................................48! Kirk Torgensen Directs That Certain “Trash” Emails Be Deleted. .......................49! Jenson Sends Letter Directly to Shurtleff’s Residence. .........................................51! Internal Debates Regarding the Transfer of Lawson and Jenson Cases. ...............52! OAG Personnel Refer Tim Lawson For an Outside Investigation and Do Not Disclose the Referral to Shurtleff. ..................................................................54! The OAG Did Not Transfer the Jenson Case Following John Swallow’s Election. .................................................................................................................55! Text Messages Between Shurtleff and Torgensen. ................................................56! Current Incarceration and Jenson’s Pending Petition ............................................57!
OBSERVATIONS AND CONCLUSIONS CONCERNING THE JENSON CASE. ................................................................................................................................58!
OVERVIEW OF OUR INVESTIGATION.
We conducted the investigation summarized in this report at the OAG’s request. While the OAG defined the basic scope of our inquiry, it did not limit how we collected our information nor did it seek to influence our conclusions. In this Part, we summarize our mandate, how we conducted our investigation, and the limitations on our work. A. Engagement as Outside Investigators and Scope of Investigation.
In late January 2014, each of us was separately contacted by a special committee of the OAG headed by Deputy Attorney General Brian Tarbet. We were asked if we were interested in assisting the OAG by conducting an internal investigation into allegations of improper conduct raised in a paper filed by Marc Jenson titled “Emergency Ex Parte Petition For Relief Under URCP 65B And 65C, Including Application For Temporary Restraining Order And Preliminary Injunction To Secure Petitioner’s Immediate Release From Custody” (hereinafter “Jenson Petition”).1 The committee asked each of us to submit separate proposals and we were interviewed separately. During that process, we each disclosed our background2 as well what might be regarded as perceived conflicts of interest.3 The OAG agreed that these possible perceived conflicts were not a barrier to our proceeding, but wondered whether we would be interested in working together on the project. We were happy to agree to this joint effort – and
The Jenson Petition was filed on December 20, 2013, in State of Utah v. Marc. S. Jenson, Utah Third District Ct. No. 051905391 (hereinafter “Jenson I”). A December 20, 2013, docket entry in the case states that, following the filing of the petition, the court held a review hearing. The December 20, 2013, docket entry also states the “court will not consider the exparte motion until it is fully briefed.” We have been advised that the court determined the petition was not filed in accordance with applicable procedural rules and directed Jenson’s counsel to file a revised petition consistent with those rules. As of the date of this Report, they have not done so. The OAG has asked us to address the substantive claims raised in the Jenson Petition, not the procedural issues associated with its filing. We have included a copy of the Jenson Petition (including its exhibits) at page 1 of the appendix to this Report. Hereinafter, any cited document that we have reproduced in the appendix to this Report will be noted by an “App. __” citation following the cited document. 2 One of us (Wikstrom) has previously served as an Assistant U.S. Attorney and as the U.S. Attorney for the District of Utah. Since leaving the Department of Justice, he has done a significant amount of white collar criminal defense work over the past 32 years. The other of us (Cassell) has previously served as an Associate Deputy Attorney General in the U.S. Department of Justice (1986-88), an Assistant U.S. Attorney for the Eastern District of Virginia (1988-91), and U.S. District Court Judge for the District of Utah (2002-07). He also teaches criminal law and procedure at the S.J. Quinney College of Law at University of Utah, Quinney College of Law at University of Utah, although he undertook this job in his own private capacity. 3 One of us (Wikstrom) is a shareholder at the Salt Lake City law firm of Parsons, Behle & Latimer. Sean Reyes, the current Attorney General, and Spencer Austin, the current Chief Deputy, Criminal in the OAG were shareholders at Parsons Behle & Latimer. We were advised that Attorney General Reyes and Chief Deputy Austin had recused themselves from the selection process and would not supervise the investigation. Since our investigation deals exclusively with activities that pre-date the new administration, we do not believe there is a conflict of interest. The other of us (Cassell) is, in addition to being a law professor, a “Special Counsel” at the law firm of Hatch, James & Dodge from February 2008 to date. Civil attorneys in this firm represented Marc Jenson in various civil cases associated with our investigation and were involved in criminal plea discussions as well. As a Special Counsel, Cassell has worked on a handful of cases with Hatch, James and Dodge attorneys. He has no equity interest in the Hatch, James & Dodge firm and has no involvement in the Jenson representation (or even awareness of them until conducting a conflict of interest check in connection with this project in January 2014). While we do not perceive there to be a conflict of interest, all matters in this report that refer to lawyers at Hatch, James & Dodge were authored by Wikstrom.
have been happy to find during the course of our investigation that our findings and conclusions have been in complete agreement with each other. From the beginning of our discussions, the OAG made clear that it wanted independent advice and gave us freedom to operate so we could provide it. While the OAG defined the basic scope of our inquiry, it did not dictate our methodology nor seek to influence our conclusions. We would not have undertaken the representation otherwise. The OAG placed no restrictions on our investigation but asked us to focus our efforts on the allegations raised in the Jenson Petition. Our assigned task was not to challenge or defend the Petition, but rather to recommend whether and how the OAG should respond to it. The OAG asked us to move rapidly and on a prudent budget. This final report presents our findings. We emphasize that our findings focus on how the OAG should respond to the Jenson Petition. Other investigators with a different mandate and with access to additional evidence may reach different findings. B. Facilitation by the OAG.
We interacted primarily with Assistant Attorney General David Sonnenreich. Sonnenreich is a senior attorney in the OAG who specializes in antitrust work. He is not a member of the office’s Criminal Division and had no substantive involvement in the Jenson matter before our investigation. He facilitated our contact with the office and our access to emails and other records necessary for our investigation. We also interacted with paralegal Brian Blake and IT Specialist Chris Earl regarding various document and database issues. Messrs. Sonnenreich, Blake, and Earl did not attempt to influence our conclusions in any way. We very much appreciated the help that we received from them and the professionalism with which they provided that assistance. C. Sources of Information and Limitations on Our Investigatory Authority.
We considered a significant volume of information during our investigation. We started by putting together a team to help us review many thousands of documents, including emails and other records related to the Jenson case.4 We preferred to rely on documents (particularly emails), where possible, as these had the advantage of having been created contemporaneously with the events being described. The body of this report contains footnotes to document the sources of information we consulted. We have also provided an appendix that contains some of the most important documents related to our investigation. The appendix contains a small subset of all the documents we considered. We also interviewed more than a dozen individuals who had direct knowledge of the Jenson case or who could otherwise provide helpful information. Many of the individuals we
Our team included Jeffrey C. Corey, of counsel at Parsons Behle & Latimer, and Taylor Mosolf and Ronda Woolston, two law students at the S.J. Quinney College of Law. They had primary responsibility for initially sorting through the documents, and we could not have completed our work without them.
spoke with are current or former members of the OAG. Others included Marc Jenson himself and individuals who had worked with him. Our primary interviews were: February 13, 2014: February 21, 2014: February 21, 2014: February 20, 2014: February 26, 2014: February 28, 2014: March 5, 2014: Marcus Mumford, Bret Rawson and Helen Redd, current counsel for Marc Jenson Che Arguello, Asst. Attorney General, OAG Scheree Wilcox, paralegal, OAG Steve Sperry, investigator, OAG Craig Barlow, Division Chief, Children’s Justice Division, OAG Hon. Charlene Barlow, previously Asst. Attorney General, OAG Greg Skordas and Rebecca Hyde Skordas, prior defense counsel for Marc Jenson (also attended by Marcus Mumford and Helen Redd, current counsel for Marc Jenson) Brandy Farmer, previously OAG Creighton Horton, previously Chief, Criminal Division, OAG Scott Reed, Chief, Criminal Division, OAG Paul Nelson, former employee of Marc Jenson Marc Jenson (also attended by Bret Rawson and Helen Redd) Leslie Mascaro, OAG Kirk Torgensen, OAG (also attended by Bret Tolman and Eric Benson) Chris Earl, OAG Ken Wallentine, OAG, previous Chief, Investigative Division Joni Jones, Asst. Attorney General, OAG
March 6, 2014: March 6, 2014: March 12 & 25, 2014: March 19, 2014: March 19, 2014: March 25 & 30, 2014: March 27, 2014: March 30, 2014: March 30, 2014: April 8, 2014:
We made clear to all of these individuals that they were not required to talk to us. All of them readily agreed to speak to us and answered every question that we put to them. In gathering information, we also benefited from the assistance from government officials outside of the OAG with knowledge of issues related to the Jenson case. We are grateful that they were willing to assist us – and by extension, the OAG – in our evaluation of these issues. 3
There were several notable limitations on our work. First, we are private citizens. We had no authority to compel anyone to speak with us. Everyone who met with us did so voluntarily. Each time we met with a current OAG employee, we told him or her that they were under no obligation to speak to us. All current OAG employees we contacted voluntarily agreed to speak with us. We also did not have the ability to collect documents from third-party sources (such as cellphone records or bank records). Our investigation was significantly limited by the fact that former Attorney General Mark Shurtleff, former Attorney General John Swallow, and Timothy Lawson declined to speak with us. All three are important figures in the Jenson matter. Lawson is currently a defendant in a pending criminal matter related to his connections to Shurtleff. Shurtleff and Swallow, although not presently charged with any offense, have retained defense attorneys who advised them against speaking with us. We understand their decision, but their unwillingness to meet with us means that many serious allegations regarding their conduct in the Jenson matter remain unanswered. In spite of these limitations, we believe that we have sufficient information to reach general conclusions about the issues raised in the Jenson Petition. II. INFORMATION LEARNED DURING THE INVESTIGATION.
In this Part, we summarize the most important facts we learned during the course of our investigation. Given the volume of information we reviewed, we could not include every detail we learned.5 A. The OAG Investigation of Marc Jenson and the Charging Decision.
The OAG case against Jenson originated with then-Attorney General Mark Shurtleff. In Spring 2005, Shurtleff received complaints from individuals who claimed that they had been defrauded by Jenson. In essence, the putative victims claimed that Jenson had convinced them to invest millions of dollars in business ventures by making a series of false promises. Those misrepresentations allegedly included Jenson’s promise that he was investing millions of his own money, that he personally was guaranteeing the investment, that his attorney had completed due diligence on a company they were purchasing, and that Jenson was depositing money into a Bank One account to help fund the business venture. Jenson alleges that one of the victims, Ricke White, had political connections to Shurtleff. White’s wife, Amy White, had donated $5,000 to Shurtleff on January 8, 2004, approximately one year before the OAG began investigating the Jenson matter.6 Shurtleff and then-Assistant Attorney General Neal Gunnarson met with Ricke White and other alleged
This Part consists primarily of factual information without commentary. At various points, however, we have noted our impressions or reactions. For example, where we believe an email or statement was misleading or inaccurate, we have noted this belief and the reasons to support our opinion. 6 See Jenson Petition, Exhibit A.4, App. 90 (copies of Mark Shurtleff campaign finance disclosure records, previously made available online through the Utah Lieutenant Governor’s office).
victims in early Spring 2005.7 On April 22, 2005, Amy White made a $1,500 contribution to Shurtleff.8 After meeting with White and others, Shurtleff referred the matter to the Division of Securities for investigation. Apparently, it was somewhat unusual (but not unheard of) for the Attorney General to become personally involved in the early stages of an investigation. 9 Michael Hines, then head of the Division of Securities, sent an August 11, 2005, email to Jenson’s then-attorney, Rodney Snow.10 In the email, Hines states “Traditionally securities cases are investigated by the Division of Securities and then I refer them, when appropriate, to a prosecutor. . . . This case began with the AG himself.”11 The Division of Securities investigated the Jenson matter and issued a report, authored by Jennifer Korb, that identified securities fraud, sale by unlicensed agent, and sale of unregistered securities as possible charges.12 Our investigation uncovered no evidence to suggest that Shurtleff attempted to influence Korb or any other individual within the Division of Securities aside from the implications of the initial referral. The Jenson case was assigned to Assistant Attorney General Charlene Barlow, an experienced line prosecutor at the OAG.13 Barlow worked with the Division of Securities as the case was being investigated.14 Ken Wallentine, the OAG’s Investigation Division Chief, told us that Barlow handled the case through the normal chain of command.15 She was aware early in the case of complaints that the victims had issues themselves that could raise questions about their character and credibility.16 In her judgment, however, Jenson had violated the law and his conduct warranted prosecution.17 On August 10, 2005, the OAG filed a criminal information against Jenson alleging two counts of securities fraud, three counts of sale of unregistered securities, and one count of engaging in a pattern of unlawful activity. All six counts were second degree felonies. Barlow signed the information on behalf of the OAG.18 The OAG also filed an affidavit of probable cause in support of the information, which was signed by Angela Kinser, an investigator with the Utah Division of Securities.19 Kinser’s affidavit alleged that, in order to induce payments,
Id. Id. 9 Interview with Kirk Torgensen, on March 27, 2014 (“Kirk Torgensen Interview”) (Torgensen previously served as Chief Deputy Attorney General and in that position oversaw the OAG’s Criminal Division). 10 Email from Michael Hines to Rodney Snow (Aug. 11, 2005, 1:00 pm), App. 336. Snow now represents John Swallow. 11 Id. 12 Division of Securities, Utah Department of Commerce, Case Summary Re: March Session Jenson, case# 05-0023 (identifying Jennifer Korb as lead investigator), App. 340. 13 Interview with Hon. Charlene Barlow, Third District Judge, on February 28, 2014 (“Charlene Barlow Interview”). 14 Id. 15 Interview with Ken Wallentine, on March 28, 2014 (“Ken Wallentine Interview”). 16 Charlene Barlow Interview. 17 Id. 18 See State’s Criminal Information, Jenson I (filed Aug. 10, 2005), App. 367. 19 See State’s Affidavit of Probable Cause at 16, Jenson I (filed Aug. 10, 2005), App. 373.
Jenson made a series of fraudulent misrepresentations to Michael Bodell, Morty Ebeling, and Ricke White.20 B. Initial Proceedings and Jenson’s Early Claims of Improper Influence.
Jenson’s initial appearance was on August 12, 2005.21 Jenson was released on bond. Thereafter, a preliminary hearing was scheduled and continued several times. During this period, Jenson retained a stable of lawyers, both criminal and civil, to represent him. Among the civil practitioners was Brent Hatch. It appears that Hatch met with Shurtleff in May 2006 and presented him with a folder of materials that purportedly demonstrated Jenson’s innocence and questioned the character of one or more of the complaining victims.22 After receiving these materials, Shurtleff forwarded them to Creighton Horton, then Criminal Division Chief in the OAG.23 Horton later emailed Barlow a warning that the documents Hatch provided to Shurtleff contained “pretty damning stuff about White,” one of the complaining victims.24 Shurtleff also called Horton to follow up on the Hatch documents.25 During the conversation, Shurtleff told Horton that he (Shurtleff) wanted “no pressure either to go forward with the case or not, based on the potential political allegations the defense may make against him or our office.”26 We found no evidence that Shurtleff disclosed the nature of the “potential political allegations” he thought the defense might raise beyond this vague warning that Horton passed on to Barlow. The preliminary hearing was continued several more times and was finally scheduled for December 13 and 14, 2006. Before the hearing, Jenson’s attorneys took the unusual step of serving subpoenas on Shurtleff and White to testify at the preliminary hearing. 27 The Shurtleff subpoena also raised the issue of whether political considerations were affecting Jenson’s case, as it sought records of all contributions to Shurtleff by the alleged victims.28 The OAG filed motions to quash the subpoenas.29 The State’s arguments in favor of quashing the subpoenas focused on procedural issues and did not address political or campaign finance issues concerning the alleged victims. In response, Jenson’s attorneys argued that the OAG should be required to produce campaign contribution information because “any campaign
Id. at 3-7. See August 12, 2005 docket entry in Jenson I. 22 See Handwritten notations dated May 23 and 24, 2006, attached to folder of materials provided by Brent Hatch, App. 389; see also Email from Creighton Horton to Charlene Barlow (Nov. 14, 2006, 5:28 pm), App. 390; see also Email from Creighton Horton to Charlene Barlow (July 8, 2006, 12:11 pm), App. 391. 23 See Email from Creighton Horton to Charlene Barlow (Nov. 14, 2006, 5:28 pm), App. 390. 24 See Email from Creighton Horton to Charlene Barlow (July 8, 2006, 12:11 pm), App. 391. 25 See Email from Creighton Horton to Charlene Barlow (May 23, 2006 at 10:54 am), App. 392. 26 Id. 27 See Defendant’s Subpoena Duces Tecum, Jenson I (filed Aug. 10, 2005) (served on Nov. 30, 2006), App. 393. 28 Id. 29 See State’s Motion To Quash Subpoena Duces Tecum, Jenson I (relating to subpoena served on Shurtleff), App. 399; see also State’s Motion To Quash Subpoena Duces Tecum, Jenson I (filed Dec. 8, 2006) (relating to subpoena served on White), App. 406.
contributions from alleged victims to the prosecutor are materials that tend to ‘negate the guilt of the accused.’”30 At the preliminary hearing, the court heard arguments on the motions to quash the subpoenas. Assistant Attorney General Matthew Bates argued that “if any information that Shurtleff has is exculpatory we are required to disclose it under Rule 16 and we will and have done that.”31 It appears that Bates was arguing, in essence, that the information Jenson sought was not exculpatory within the meaning of the Rules of Criminal Procedure. In response, Rebecca Hyde argued on behalf of Jenson that Shurtleff should be compelled to testify at the hearing because he was a fact witness and could help the defense establish information that it could use to impeach the credibility of the victims in the case.32 After hearing each side’s arguments, the court voiced concerns regarding the relevancy of the information Jenson sought and the implications of allowing Jenson to subpoena the Attorney General. The court granted the OAG’s motions to quash and the hearing went forward. At the conclusion of the hearing, the court found that there was probable cause to bind over Jenson for trial.33 C. OAG Receives Complaint Regarding the Mt. Holly Development.
Shortly after the preliminary hearing, Barlow received a letter from attorney James Bradshaw.34 In his letter, Bradshaw alleged that Jenson was engaged in fraud associated with the development of the Mt. Holly Resort in Beaver County, Utah. Bradshaw reported to Barlow that Jenson and a business he owned, Nimbus Capital, had acquired ownership of the resort by foreclosing on a loan they had made to the resort’s prior owners. He further reported that Jenson was now marketing the resort as “The Mt. Holly Club.” Bradshaw alleged that Jenson was engaged in a number of illegal practices, including marketing land for sale that he did not own, failing to register as a real estate agent, soliciting buyers despite lacking necessary approvals from Beaver County, and false advertising. After receiving Bradshaw’s letter, it appears that the OAG considered a possible investigation of Jenson consistent with its normal policies. According to meeting minutes of an OAG screening committee meeting held on January 11, 2007, the committee discussed Bradshaw’s letter.35 The meeting minutes also state that “Mark Jenson [sic] will be contacted for further information. Off agenda till further notice.”36
See Defendant’s Memorandum Opposing Motion To Quash Subpoena Duces T ecum at 5, Jenson I (quoting Utah R. Crim. P. 16) (filed Dec. 12, 2006) (regarding subpoena served on Shurtleff), App. 409 see also . Defendant’s Memorandum Opposing Motion To Quash Subpoena Duces Tecum, Jenson I (filed Dec. 12, 2006) (regarding subpoena served on White), App. 417. 31 See Video of December 14, 2006 Preliminary Hearing at approximately 2:40 minutes. Any citations herein to video or audio recordings of court hearings are based on copies received from the court. The times referenced are approximate. 32 Id. 33 Id. 34 See Letter from James Bradshaw to Charlene Barlow (Dec. 19, 2006), App. 423. 35 See Meeting Minutes of January 11, 2007 OAG Screening Committee Meeting, App. 425. 36 Id.
Plea Negotiations and Jenson’s Efforts to Directly Influence Shurtleff.
In late 2006, Jenson embarked on an aggressive effort to persuade the OAG to dismiss the charges through traditional routes – his criminal defense attorneys dealt directly with the line prosecutor and her supervisors – and through less orthodox routes in which Jenson’s civil attorneys, lobbyists, employees, friends, and Jenson himself contacted Shurtleff directly. During the plea negotiation process Jenson assembled two distinct teams to address negotiations. People familiar with the negotiations have referred to the teams as the “formal” and “informal” defense teams. Jenson’s formal defense team ultimately consisted of experienced defense attorneys Greg Skordas and Rebecca Hyde (now Rebecca Hyde Skordas). The informal defense team included civil attorneys Mark James, Brent Hatch, Eric Pearson, and John Swallow (who had not yet joined the OAG). The informal team also included non-attorneys Tim Lawson, Paul Nelson, Doug Fox, Rob Stahura, and Jenson himself. During the early stages of the negotiations, the formal team was unable to secure a favorable plea deal from Barlow. On January 17, 2007, Barlow made a plea offer to Rebecca Hyde that required Jenson to plead guilty to a second degree felony and pay full restitution to Bodell and Ebeling.37 Skordas and Hyde were never able to persuade Barlow, or her supervisors, Scott Reed and Kirk Torgensen, to offer Jenson anything less than a felony plea. In the meantime, they proceeded with discovery and pre-trial motions, including a largely unsuccessful motion to quash the bind-over.38 Meanwhile, the informal defense team proceeded on a parallel path to try to influence Shurtleff directly. For example, on April 5, 2007, Paul Nelson, one of Jenson’s employees and strongest supporters, emailed Shurtleff’s assistant and demanded a meeting with Shurtleff to discuss Jenson’s case.39 In the email, Nelson claimed the Jenson case “has turned into a ‘SCANDAL’ that will be published in the press soon.”40 Shurtleff met with Nelson on April 30, 2007. During that meeting, Nelson apparently asked Shurtleff to speak to then-United States Attorney Brett Tolman about issues related to the Jenson case and requested Shurtleff to meet personally with Jenson. Apparently during that meeting, Nelson also stated that he suspected Shurtleff was pursuing the case because Ricke White had donated to Shurtleff’s campaign.41 Following the meeting, Nelson emailed Shurtleff to confirm that he (Shurtleff) would follow through with promises made at the meeting, including a promise to speak to U.S. Attorney Tolman.42 Shurtleff responded to Nelson’s email minutes later, stating that he had already spoken with Tolman and that he would wait to hear
Interview with Scheree Wilcox, on February 21, 2014 (“Scheree W ilcox Interview). See Defendant’s Motion To Quash Bind-over, Jenson I (filed Mar. 8, 2007), App. 427; see also Defendant’s Memorandum In Support Of Motion To Quash Bind-over, Jenson I (filed Mar. 8, 2007), App. 429. 39 See Email from Paul Nelson to Helen Petersen (April 5, 2007, 3:21 pm), App. 476. 40 Id. 41 See Jenson Petition Exhibit C, June 14, 2013 Declaration of Paul Nelson, App. 256 (hereinafter the Jenson Petition exhibit containing Nelson’s declaration will be cited as “Declaration of Paul Nelson” without reference to the Petition). Nelson identifies the date of his April 30, 2007 meeting with Shurtleff as April 10, 2007. 42 See Email from Paul Nelson to Mark Shurtleff (April 25, 2007, 5:04 pm), App. 478.
from Jenson’s lawyers before agreeing to a meeting with Jenson.43 Shurtleff also forwarded the email to Barlow, Reed, and Wallentine.44 Shurtleff added, By the way, I never told him I would drop the case. I told him we do not prosecute someone unless we are convinced we have a strong probability we can prove guilt beyond a reasonable doubt. We are always interested in information about our victims and witnesses and would (and have in this case) reevaluate our case based on new information. I haven’t seen any information different from what Brent Hatch brought us.45 On May 17, 2007, Shurtleff mentions Rob Stahura of Mentoring of America, and how it was a group that had previously contributed to Shurtleff’s law day.46 Paul Nelson told us that around this time Rob Stahura brought Tim Lawson to Marc Jenson’s office, where Nelson was working with Jenson. Stahura introduced Lawson to Jenson and Nelson as “one of Mr. Shurtleff’s best friends.”47 Stahura had previously told Jenson that the key to resolving matters with Shurtleff was to donate to Shurtleff’s political campaign. Stahura had explained how, after he donated to Shurtleff, the OAG had largely stayed away from investigating his call center business. Lawson and Jenson met and then Jenson directed Nelson to cut a $5,000 check for Lawson. Nelson did that.48 According to Nelson, he personally cut checks for Lawson of $5,000 every several weeks. Nelson said that Lawson would often refer to himself as a “fixer.”49 Nelson also said in a later, sworn declaration that he twice confronted Shurtleff about these payments and that Shurtleff said something to the effect of, “Yeah, Lawson is my man and Jenson should continue to pay him.”50 E. Shurtleff’s Increased Involvement in Plea Negotiations.
Assistant Attorney General Scott Reed, who was Barlow’s direct supervisor, told us that Barlow came to him during Spring 2007 to discuss the Jenson case and to complain that Shurtleff had questioned her several times regarding the merits of the case. According to Reed, Barlow also reported that Shurtleff voiced his opinion to Barlow that the victims (White, Ebeling, and Bodell) were “sleazeballs.”51 Barlow, according to Reed, wanted him (Reed) to be a buffer against Shurtleff’s inquiries.52 Reed said that, in response to Barlow’s concerns about Shurtleff’s interference, he and then Chief Deputy Attorney General Kirk Torgensen began discussing the
See Email from Mark Shurtleff to Paul Nelson (April 11, 2007, 11:25 am), App. 479. See Email from Mark Shurtleff to Charlene Barlow et al. (April 30, 2007, 5:47 pm), App. 482. 45 Id. 46 See Email from Mark Shurtleff to Ken Wallentine et al. (May 17, 2007, 10:17 pm), App. 487. 47 Declaration of Paul Nelson, App. 256. 48 We have received a spread sheet, identifying a series of payments from Jenson to Lawson’s company, the Apple Dumpling Gang App 488. However, the first payment to Lawson on this spreadsheet appears much later — on January 30, 2009. Id. Because of limited time, we have not attempted to identify whether payments were made earlier through different accounts. 49 Declaration of Paul Nelson, App 256. 50 Id. 51 Interviews with Scott Reed on March 12 and 25, 2014 (“Scott Reed Interview”). 52 Id.
matter. Reed informed us that he also told Barlow not to worry about Shurtleff and “just go try the case.”53 Reed and Torgensen both told us that they asked Shurtleff to let the prosecution unfold in the normal way – by allowing the line attorney to handle the case without intervention from above.54 This advice was consistent with recognized “best practices” within the OAG. At some point before the Jenson case was well underway, the OAG’s Quality Assurance and Leadership Management Group (QALM) had put together some “best practices” recommendations for the office. One of the best practices that QALM came up with was that the Attorney General should not meet with defendants or defense counsel without the line prosecutor present. Shurtleff was informed of, and agreed with, the recommendation.55 Shurtleff did not follow the advice of Reed and Torgensen or the best practice suggestion in the Jenson case. Instead, we uncovered many instances throughout Spring and Summer 2007 when Shurtleff directly involved himself in the case. Based on our conversations with many OAG attorneys, his high level of involvement in the case was quite unusual. For example, on June 29, 2007, Shurtleff emailed Torgensen, Reed, and Barlow, stating “I have a request to meet alone with Skordas, Jensen [sic] and a lobbyist for breakfast Monday. Objections?”56 Reed objected and said that “we all need to be together with Jenson and his counsel.”57 Shurtleff ignored the advice and met with Jenson and his attorneys, Mark James, Eric Pearson, and Greg Skordas, at the Grand America Hotel.58 Skordas confirmed that he attended a meeting at the Grand American Hotel with Jenson and Shurtleff and no other members of the OAG.59 At that meeting, Jenson made a direct appeal to Shurtleff to dismiss the charges. Our investigation discovered an increase in activity between Jenson’s informal defense team and Shurtleff following the court’s denial of Jenson’s motion to quash the bind-over on August 15, 2007. The next day, Shurtleff emailed Barlow and told her that he had lunch with a “friend” just to “catch up.”60 Shurtleff stated: “[A] friend was asked by Jenson and his friend Rob Stahura to try and sway me. This friend was also offered money…. Shouldn’t it be a crime to offer people money to try to get a prosecutor to dismiss a case?”61 Although Shurtleff does not disclose to Barlow the name of the “friend” with whom he had lunch, Shurtleff’s electronic office calendar shows he was scheduled to have lunch with Tim Lawson. 62
Scott Reed Interview. Scott Reed Interview; Kirk Torgensen Interview. 55 Ken Wallentine Interview. 56 See Email from Mark Shurtleff to Kirk Torgensen et al. (June 29, 2007, 1:09 pm), App. 489. 57 See Email from Scott Reed to Mark Shurtleff (June 29, 2007, 1:14 pm), App. 489. 58 Interview with Marc Jenson on March 19, 2014, (“Marc Jenson Interview”). 59 Interview with Greg Skordas and Rebecca Hyde on March 5, 2014, (“Greg Skordas and Rebecca Hyde Interview”). 60 See Email from Mark Shurtleff to Charlene Barlow (Aug. 16, 2007, 9:33 am), App. 490. 61 Id. 62 See Mark Shurtleff calendar entry (Aug. 16, 2007), App. 491. On September 7, 2007, Helen Petersen, Shurtleff’s personal assistant, emailed him about a scheduling conflict and noted that his calendar read “lunch with Tim Lawson, et al., to pick up a check.” See Email from Helen Petersen to Mark Shurtleff (Sept. 7, 2007), App. 492.
On August 17, 2007, Paul Nelson emailed Shurtleff and urged him to drop the case against Jenson, stating: Marc Jenson and anybody associated with him have nothing but positive feelings towards you. I have known Marc Jenson for over 30 years. He is not a vengeful man. . . . Any harsh feelings or negativity that he may have felt two years ago is now long gone and both he and I would like to be counted amongst your top supporters and friends. The future is bright.63 Shurtleff forwarded Nelson’s email to Barlow, Reed, and Torgensen.64 On August 24, 2007, Barlow emailed Shurtleff, Reed, and Torgensen to inform them that White’s bankruptcy attorney had called and left a message about White’s bankruptcy discharge.65 The bankruptcy judge had ruled in White’s favor, allowing him to discharge his debt.66 When communicating with the OAG, Nelson had previously raised White’s bankruptcy proceedings as a factor to question White’s creditability as a witness against Jenson.67 Nelson also testified in White’s bankruptcy proceedings.68 Barlow conveyed White’s attorney’s description of White as a “sqeeky [sic] clean witness.”69 Barlow quipped, “[g]uess Nelson’s testimony against White didn’t help.”70 Shurtleff responded, “But I thought this was the biggest bankruptcy fraud in Utah history! . . . Thanks Charlene – you made my day!”71 Also on August 24, 2007, Shurtleff emailed Reed, Barlow, Torgensen, and Wallentine. The body of the email contained a draft reply, written by Shurtleff, to an email sent by Paul Nelson to Shurtleff. Shurtleff asked for comments on his draft response to Nelson. Reed forwarded Shurtleff’s email to Torgensen, with the note “What the f***? Just leave it alone, huh?”72 Torgensen later told us that this email reflected the fact that he and Reed were surprised that Shurtleff was getting so heavily involved in the case. Moreover, they were frustrated that Shurtleff was giving this much credence to someone who did not know the details of the case. This was to prove to be an on-going source of frustration. Kirk Torgensen recalled in his interview that on numerous occasions he would warn Shurtleff against having private meetings on criminal cases without the line prosecutors being present. Torgensen said that he respected Shurtleff’s “open door” policy – i.e., a willingness to meet with people if they had a complaint. However, in criminal cases, the entire team working on the case should have been present.73
See Email from Paul Nelson to Mark Shurtleff (Aug. 17, 2007, 1:02 pm), App. 493. See Email from Mark Shurtleff to Charlene Barlow et al. (Aug. 17, 2007, 1:05 pm), App. 494. 65 See Email from Charlene Barlow to Mark Shurtleff et al. (Aug. 24, 2007, 10:52 am), App. 495. 66 Id. 67 See Email from Paul Nelson to Helen Petersen (April 3, 2007, 5:39 pm), App.477; Email from Paul Nelson to Mark Shurtleff (April 25, 2007 5:04 pm), App 478; Email from Paul Nelson to Mark Shurtleff (Aug. 17, 2007, 1:02 pm), App. 493. 68 See Email from Charlene Barlow to Mark Shurtleff et al. (Aug. 24, 2007, 10:52 am), App. 495. 69 Id. 70 Id. 71 See Email from Mark Shurtleff to Charlene Barlow et al. (Aug. 24, 2007, 11:45 am), App. 495. 72 See Email from Scott Reed to Kirk Torgensen (Aug. 24, 2007, 9:00 pm), App. 496. 73 Kirk Torgensen Interview.
On August 27, 2007, Shurtleff emailed Barlow, Torgensen, Wallentine, and Reed. 74 The subject line of the email read only “Jensen [sic].” Shurtleff commented, “Mr. Untouchable is losing it. A friend sent me a text saying that after the bankruptcy ruling re White, he was so upset he lucked [sic] himself in his office and wouldn’t come out or talk with anyone for two days.” Based on the subject line of the email it is our belief that Shurtleff was referring to Jenson as “Mr. Untouchable.” It is also our belief that this information was likely provided to Shurtleff by Lawson. On September 5, 2007, Reed emailed Shurtleff and Torgensen stating: I got a call from Skordas today, wondering if there was anything we could talk about on the Jenson case. I told him that we are willing to talk about a reasonable disposition. At present, those discussions would not include anything less than a felony conviction, which Jenson could not accept. I also told Greg I would be reluctant to meet with him without Charlene, and he said he had been advised otherwise. What are your directions regarding this process? Any guidance before I set up a meeting?75 Torgensen agreed that there should be no meeting without Barlow and asked what there was to discuss if Skordas wanted less than a felony.76 Reed replied: Because Skordas says that Fox says that Shurtleff says for them to meet with Scott and Kirk only and that it doesn’t have to be a felony because our office does pleas in abeyance and those kinds of things all the time. If that’s what Mark wants us to do. I just need to hear it from him.77 Torgensen replied: “I will have it out on this one. This is BS.”78 Torgensen told us that he did have it out with Shurtleff, again telling him not to get so heavily involved in this (and other) cases. He recounted that, in his view, a plea bargain would be an acceptable resolution of the case, but it should have involved nothing less than a guilty plea to a felony. Torgensen was also upset that lobbyists and other non-lawyers, were having such a strong influence on the plea negotiation process.79 On September 7, 2007, Shurtleff emailed Barlow, Torgensen, Reed, and Wallentine.80 Shurtleff told them, “I’ve heard from several sources that jensen [sic] has somehow convinced Mark Robbins to take take [sic] the stand when we call him and ‘fall on his sword’ for jensen [sic] and take responsibility for the fraud.”81 Shurtleff wanted to know if they had any thoughts or concerns regarding this new information, and stated, “[w]e may have another potential witness
See Email from Mark Shurtleff to Charlene Barlow et al. (Aug. 27, 2007, 5:01 pm), App. 502. See Email from Scott Reed to Mark Shurtleff et al. (Sept. 5, 2007, 8:39 am), App. 503. 76 See Email from Kirk Torgensen to Scott Reed (Sept. 5, 2007, 8:43 am), App. 503. 77 See Email from Scott Reed to Kirk Torgensen (Sept. 5, 2007, 8:48 am), App. 503. 78 See Email from Kirk Torgensen to Scott Reed (Sept. 5, 2007, 8:51 am), App. 503. 79 Kirk Torgensen Interview. 80 See Email from Mark Shurtleff to Charlene Barlow et al. (Sept. 7, 2007, 1:09 pm), App. 504. 81 Id.
tampering.”82 Shurtleff’s reference to unnamed “several sources” suggests he continued to receive information from outsiders but did not want to disclose the identity of those individuals to his subordinates. F. Barlow Extends a Felony Plea Offer That Includes Restitution.
On September 28, 2007, Barlow forwarded to Shurtleff, Torgensen, and Reed a draft plea offer to Jenson that required him to plead guilty to two third degree felonies and pay restitution of $4.1 million.83 Barlow raised concerns that she did not feel comfortable trying to explain to the press why the case was being pled as third degree felonies.84 Barlow told us that she had been told by Torgensen and Reed that Shurtleff had decided to offer the third degree felony plea.85 She said that it was very unusual for the Attorney General to tell her what to offer. 86 She told Reed and Torgensen that she was unhappy with the offer, and they told her she had to live with it.87 About a week later, Barlow spoke with Rebecca Hyde on an unrelated matter, but discussed Jenson briefly.88 Barlow later told Reed and Torgensen that Hyde gave her some information that she (Barlow) would prefer not to put in an email, and asked them to call her (Barlow) so she could fill them in.89 Barlow does not recall what that information was.90 Neither Reed nor Torgensen could recall specifically what that information might have been. Torgensen thought it might possibly have been information regarding Marc Jenson having dated Shurtleff’s wife in high school, but he was not certain.91 G. October 2007: Nelson’s Recorded Conversation with Shurtleff and Jenson’s Visit to Shurtleff’s Hospital Room.
Paul Nelson visited Shurtleff on October 12 and 19, 2007. During those meetings, Nelson allegedly offered Shurtleff a bribe to dismiss charges against Jenson. Shurtleff apparently recorded the conversations with the assistance of the Federal Bureau of Investigation (“FBI”). We met with Nelson and questioned him about his October 12, 2007, and October 19, 2007, meetings with Shurtleff. Nelson denies offering Shurtleff a bribe. He claims that he and Shurtleff discussed campaign contributions and, during the course of the conversation, he brought up Jenson’s case. According to Nelson, when he (Nelson) encouraged Shurtleff to agree to dismiss the charges against Jenson, Shurtleff said, “What’s in it for me.” 92 The FBI did not make the recordings available to us. Consequently, we were not able to verify Nelson’s version of the conversation. Nelson has never been charged with a crime on account of the meetings.
Id. See Email Charlene Barlow to Scott Reed et al. (Sept. 28, 2007, 2:35 pm), App. 505. 84 Id. 85 Charlene Barlow Interview. 86 Id. 87 Id. 88 See Email from Charlene Barlow to Scott Reed et al. (Oct. 4, 2007, 12:33 pm), App. 508. 89 Id. 90 Charlene Barlow Interview. 91 Kirk Torgensen Interview. 92 Paul Nelson Interview.
Also in October 2007, Jenson visited Shurtleff, uninvited, while Shurtleff was in a rehabilitation hospital convalescing from surgery on account of his motorcycle accident on September 22, 2007. In an October 22, 2007, email to Torgensen, Shurtleff acknowledged that “Jensen [sic] dropped by” the previous Saturday [October 20, 2007].93 According to Jenson, Lawson told him where Shurtleff was hospitalized and that he was registered at the hospital under an assumed name to avoid the press. Jenson had his wife bake cookies, which he brought as a gift for Shurtleff. According to Jenson, during the visit he told Shurtleff that he was not going to take a plea deal and was not going to pay restitution. Jenson claims that, in response, Shurtleff said: “You have to give me a way to save face politically. People in the office really hate you. Have you heard of a plea in abeyance?” When Jenson responded that he did not know what a plea in abeyance was, Shurtleff allegedly explained the legal significance of the plea, including the fact that Jenson would have no criminal conviction at the end of the process. Shurtleff asked Jenson if he could live with that.94 Shurtleff said he did not record his hospital conversation with Jenson because he could not turn on his recorder in time.95 He did, however, contact Greg Skordas, who apologized for his client’s visit and told Shurtleff that Jenson was “scared to death.”96 On October 22, 2007, Jenson’s case was scheduled for a 4-day jury trial to begin on February 26, 2008. In our meeting with Reed, he told us that, from his perspective, plea negotiations were “radio silent” in October and November of 2007. He later learned that formal plea negotiations were not progressing during this period because Jenson’s “informal” team was directly contacting Shurtleff.97 H. Shurtleff Instructs Reed to Offer a No Contest Plea.
On December 13, 2007, Shurtleff told Reed that he had met with Mark James and “others,” and that he would “seriously consider” a plea in abeyance for Jenson that included restitution.98 For some reason, Shurtleff added that he was “[n]ot succumbing to bribes or threats.”99 Reed responded that Jenson’s people had taken over the plea negotiation process, and that the case had “become a runaway freight train.”100 Charlene Barlow later recounted that Torgensen and Reed told her that Shurtleff was “listening to people” even though they had told Shurtleff not to do so and to send them to Reed or Torgensen instead.101 Reed also spoke with Shurtleff and told him that the plea in abeyance was a bad idea. He told Shurtleff that OAG had a good case and they should just try it. In an email that day, Shurtleff said, “I am intent on accepting a no contest plea in abeyance.”102 Reed was very upset about the disposition of the
See Email from Mark Shurtleff to Kirk Torgensen (Oct. 22, 2007, 7:39 am), App. 509. Marc Jenson Interview. 95 See Email from Mark Shurtleff to Kirk Torgensen (Oct. 22, 2007, 7:39 am), App. 509. 96 Id. 97 Scott Reed Interview. 98 See Email from Mark Shurtleff to Scott Reed (Dec. 13, 2007, 7:06 am), App. 511. 99 Id. 100 Id. 101 Charlene Barlow Interview. 102 See Email from Mark Shurtleff to Scott Reed (Dec. 13, 2007, 7:06 am), App. 511.
Jenson case and also the precedent it was setting. According to Reed, a no-contest plea in abeyance was very unusual. He complained strongly to Torgensen, who agreed with him.103 The OAG has no formal written guidelines for plea bargaining in general or pleas in abeyance in particular.104 Normally, a plea bargain might involve a one-step reduction of the most serious charges.105 But there was no formal policy in place regarding appropriate plea dispositions, and the matter was left to individual prosecutor discretion. On January 2, 2008, Shurtleff told his assistant, Helen Petersen to set up a meeting with Torgensen, Reed, and Charlene Barlow to discuss the Jenson plea deal. 106 The next day Reed asked Shurtleff if the meeting could only include Shurtleff, Reed, and Torgensen. 107 Reed then asked Charlene Barlow if she would mind sitting out the meeting.108 Reed thought Shurtleff could no longer be convinced that this was a winnable case and that the negotiation discussion would only frustrate Barlow.109 Reed also needed to discuss in private with Torgensen whether multi-level negotiations should be permitted to continue after the Jenson case.110 Reed hoped to distance Barlow from the case and insulate her from any plea agreement. 111 Barlow said she was fine with missing the meeting, and agreed that her involvement would only increase her frustration level. 112 Barlow also stated that she still believed that the case was winnable, contrary to what Jenson’s people may have told Shurtleff, and that if it were not winnable, she would be the first to dismiss it.113 On January 3, 2008, Reed and Torgensen met with Shurtleff regarding the Jenson case. Torgensen told us in his interview that he “distinctly recalled” questioning Shurtleff about why he was becoming so heavily involved in the case. Torgensen told him that Barlow had a good case and the best answer to any questions that might be raised about the case was to let a jury decide.”114 Torgensen told us that he left the meeting thinking that he and Reed had convinced the Attorney General to allow the case to go forward. “Mission accomplished,” was his impression.115 But then, “out of the blue,” Shurtleff decided that there was to be a plea in abeyance resolution. Reed recalled that there were some communications between him and Shurtleff about whether it would be proper to offer a plea in abeyance. When Reed told Shurtleff that would not be a proper offer, Shurtleff sheepishly admitted that he “kind of, sort of already offered it.”116 Essentially, Shurtleff told Torgensen and Reed, “I know you guys are really upset,
Scott Reed Interview. Id. 105 Id. 106 See Email from Mark Shurtleff to Helen Petersen et al. (Jan. 2, 2008, 2:28 pm), App. 513. 107 See Email from Scott Reed to Mark Shurtleff et al. (Jan. 2, 2008, 2:28 pm), App. 513. 108 See Email from Scott Reed to Charlene Barlow (Jan. 3, 2008, 7:33am), App. 514. 109 Id. 110 Id. 111 Id. 112 See Email from Charlene Barlow to Scott Reed (Jan. 3, 2008, 10:37 am), App. 514. 113 Id. 114 Kirk Torgensen Interview. 115 Kirk Torgensen Interview. 116 Scott Reed Interview.
but this is the way we’ve got to do it [a no-contest plea in abeyance].117 Charlene Barlow was told by Torgensen and Reed that Shurtleff had told them “to make the [Jenson] case go away.” Torgensen put it slightly differently –there was a directive to resolve the case with a no contest plea in abeyance.118 Kirk Torgensen, who had been in the office for many years, had never heard of such an arrangement. “A no contest plea to plea in abeyance – what’s that?” was his first impression.119 Barlow recalled that Torgensen and Reed were not happy with the directive and neither was she.120 When Barlow next spoke with Skordas and Hyde, they seemed embarrassed about the whole situation. They said it was not their idea; rather it was being driven by Mark James and Brent Hatch.121 According to Reed, when Barlow was told that Jenson had been offered a nocontest plea in abeyance, she refused to have any involvement in presenting the plea to the Court and told Reed “You can’t make me do this.”122 Barlow told us she considered quitting her job if she were forced to present the no-contest plea in abeyance in court.123 Ultimately, Reed told her that he would present the plea to the Court so that she would not have to.124 Several people in the OAG later used colorful metaphors to describe what had happened, i.e., that Reed had “fallen on his sword”125 or “taken a bullet for the team.”126 A few days later on January 7, 2008, Shurtleff emailed his assistant Helen Petersen asking her to set up a meeting with Marsha Oriti at Mentoring of America, and a lunch meeting with CEO Doug Gravink and COO Gary Hewitt for the following week.127 Tim Lawson was an employee of Mentoring of America and was copied on the email, and Rob Stahura was a managing employee of the company.128 Campaign records show that from August 2007 through November 2008 Shurtleff received a total of $12,500 from Mentoring of America.129 On January 10, 2008, Reed sent Shurtleff a draft of a plea offer letter to Skordas and asked for Shurtleff’s comments.130 The draft plea offer proposed a no contest plea in abeyance with a three-year abeyance period and a $15,000 fine, but was vague about restitution, stating only that Jenson would pay restitution to Bodell and Ebeling in an amount “which shall be agreed upon” in writing prior to the entry of the plea.131 In the draft letter Reed stated “[f]rankly, I have strong reservations regarding this proposal. It is the direction of the Attorney General”
Scott Reed Interview. Kirk Torgensen Interview. 119 Kirk Torgensen Interview. 120 Scott Reed Interview. 121 Id. 122 Id. 123 Charlene Barlow Interview. 124 Id. 125 Interview with Che Arguello on February 21, 2014, (“Che Arguello Interview”). 126 Ken Wallentine Interview. 127 Search Warrant Affidavit #14190003, pg. 13, ¶ 28. 128 Id. 129 Id. 130 See Email from Scott Reed to Mark Shurtleff (Jan. 10, 2008, 9:05:15 am), App. 515. 131 Id.
that this plea offer is acceptable.132 Shurtleff responded to the draft, “[l]ooks good to me. Thanks for doing this (even though you had to hold your nose).” 133 Also, on January 10, 2008 Helen Petersen, Shurtleff’s assistant, received an email from Tim Lawson about a dinner meeting for Shurtleff in Salt Lake City on January 16, 2008. 134 Lawson specified that Ryan Poleman would be bringing a $25,000 donation check to the meeting, and that with the $40,000-$50,000 donation by Jeremy Johnson and another $25,000 from an unnamed source the Shurtleff campaign would be receiving a donation of $100,000.135 On February 11, 2008, a hearing was held on motions in limine filed by both sides. Judge Reese ruled that the defense would be prohibited from inquiring into any meetings that victims may have had with Shurtleff, any contributions they may have made to Shurtleff’s campaign, and any fundraising parties or any other parties they may have hosted where Shurtleff was invited. The defense’s main reason for wanting to use the evidence of White’s meeting with Shurtleff was for purposes of later impeaching White’s testimony. The day after the hearing, Reed told Skordas that restitution to Bodell was “off the table,” and that restitution would only be $2.5 million.136 A short time later, Shurtleff asked Charlene Barlow about the motion in limine hearing.137 Barlow explained the ruling, and included that only certain questions could be asked of White and Ebeling.138 Shurtleff commended her for the results.139 As the process continued, members of the OAG and victims in the Jenson case began hearing rumors about the plea deal that would be given to Jenson. On February 25, 2008, Charlene Barlow sent an email to Reed and Torgensen stating: “I’ve had phone calls from bot h Rick White and Morty Ebeling . . . word is on the street is that Jenson has cut a deal” and they want to know what it is.140 She goes on to state that “[e]vidently, the word is also that [Senator] Hatch has put pressure on the AG to do the deal.”141 Hyde and Skordas reported that sometime during February or March 2008, a meeting occurred at Skordas’s office between Skordas’s “formal” legal team (Skordas and Hyde) and members of Jenson’s “informal” legal team.142 They discussed what an ideal plea deal would look like and Skordas and Hyde were told that the alternative team had access to OAG and could deliver the ideal plea deal. Hyde and Skordas were skeptical of the claims made by the informal team members.143
Id. See Email from Mark Shurtleff to Scott Reed (Jan. 10, 2008, 9:22 am), App. 515 134 See Email from Tim Lawson to Helen Petersen (Jan. 10, 2008, 8:10 pm), App. 517. 135 Id. 136 See Email from Scott Reed to Greg Skordas et al. (Feb. 12, 2008, 2:31 pm), App. 518. 137 See Email from Mark Shurtleff to Charlene Barlow (Feb. 20, 2008, 7:55 pm), App. 519. 138 See Email from Charlene Barlow to Mark Shurtleff et al. (Feb. 21, 2008, 9:55 am), App. 519. 139 See Email from Mark Shurtleff to Charlene Barlow et al. (Feb. 21, 2008, 10:03 am), App. 519. 140 See Email from Charlene Barlow to Scott Reed et al. (Feb. 25, 2008, 1:25 pm), App. 520. 141 Id. 142 Interview with Rebecca Hyde and Greg Skordas. 143 Id.
On February 28, 2008, Reed was still discussing the terms of a plea agreement with Skordas, and restitution for Ebeling was still on the table.144 Both Shurtleff and Torgensen were copied on that email.145 Reed was under the illusion at that time that he was still in charge of the plea negotiations on behalf of the State.146 However, on February 29, 2008, Lawson emailed Shurtleff and outlined the terms of a plea agreement.147 The email read, “[a]ll I would like you to do bro is review this,” and attached was a Word document with detailed bullet points regarding the terms of the plea.148 The document rejected as too onerous Reed’s current plea offer, which required Jenson to pay Ebeling $2.5 million, pursue civil litigation, and satisfy any judgment, and instead proposed less onerous alternative terms.149 Shurtleff forwarded an email, which included the Lawson attachment to Reed and Torgensen.150 Torgensen recounted in his interview his impression that Shurtleff had not meant for them to see everything in the attachment, particularly the involvement of Lawson in the plea negotiations.151 Torgensen responded asking Shurtleff why they were dealing with Lawson, and told Shurtleff that the OAG cannot “ethically” deal with Lawson outside of Jenson’s counsel and that it was inappropriate for Lawson to inject himself into the plea process.152 Shurtleff replied that he told Lawson the same thing.153 Shurtleff then told Reed and Torgensen that Jenson had an attorney other than Skordas “working Lawson,” and that he (Shurtleff) forwarded the email “so you guys would know what’s going on.”154 During this period, the Mt. Holly investigation became an issue. After filing charges against Jenson for allegedly defrauding Bodell, White, and Ebeling, the OAG considered an investigation of Jenson on account of his efforts to develop a resort known as Mt. Holly Club. As discussed above, in December 2006, the OAG received a letter from attorney James Bradshaw alleging that Jenson was engaged in fraud with respect to Mt. Holly. Although the office discussed the allegations in Bradshaw’s letter at a screening meeting on January 11, 2007, it appears that nothing further was done. During the plea negotiations in early 2008, Jenson’s camp wanted to get language in the agreement that allowed Jenson to continue his efforts on Mt. Holly because that was to be the source of income to pay restitution. In response, on March 3, 2008, Reed told Hyde: “We’ll give you Mt. Holly, so we know what to keep an e ye on during the PIA period, otherwise, no can do on the rest of it.”155 On March 5, 2008, Torgensen told Shurtleff that the Jenson deal was struggling.156 Shurtleff had been copied on some of Skordas’s recent emails to Reed and seemed to know the current status of negotiations.157 Shurtleff told
See Email from Scott Reed to Greg Skordas et al. (Feb. 28, 2008, 10:25 am), App. 521. Id. 146 Scott Reed Interview. 147 See Email from Tim Lawson to Mark Shurtleff (Feb. 29, 2008, 8:52 am), App. 524. 148 Id. 149 Id. 150 See Email from Mark Shurtleff to Scott Reed et al. (Feb. 29, 2008, 9:04 am), App. 527. 151 Kirk Torgensen Interview. 152 See Email from Kirk Torgensen to Mark Shurtleff (Feb. 29, 2008, 9:12 am), App. 528. 153 See Email from Mark Shurtleff to Kirk Torgensen et al. (Feb. 29, 2008, 9:15 am), App. 528. 154 Id. 155 See Email from Scott Reed to Greg Skordas et al. (March 3, 2008, 8:49 am), App. 530. 156 See Email from Kirk Torgensen to Mark Shurtleff (March 5, 2008, 8:49 am), App. 532. 157 See Email from Mark Shurtleff to Kirk Torgensen (March 5, 2008, 10:43 am), App. 532.
Torgensen that if the deal is only hung up on the demand that Jenson settle any unrelated lawsuits, the OAG “can give on that one Skordas request.”158 In March 2008, Bodell contacted Shurtleff asking questions about the Jenson case and why restitution was not included for him.159 Shurtleff forwarded the questions and concerns to Reed and Torgensen.160 Reed became frustrated when he attempted to contact Bodell but Bodell would not answer his call, and he sent an email to Torgensen stating: “[y]es, boss, I called him like you asked. I called the number he gave, and he didn’t answer. Just like he didn’t answer when Scheree called him. Seems he has no trouble reaching Mark, huh?”161 Two weeks later, on March 19, 2008, Shurtleff again interjected himself into the negotiation process.162 Shurtleff asked Reed about the plea hearing that was scheduled on March 21, 2008. Shurtleff apparently had been in contact with others regarding the case, but did not specify in the email to Reed who he had heard from. Shurtleff told Reed he wanted to know about the status of the plea offer and specifics about its terms. Based on information Shurtleff had received, he wanted Reed to justify why the OAG had said “no” to Jenson’s counteroffer. Reed responded, copying Torgensen and stated: Look, boss. The deal is almost done. I would prefer you to stay out of it at this point. I just need to go over Rebecca’s paperwork tomorrow and finalize the details, and then talk with the victims prior to the plea hearing. The deal will get done, so there is no “we said no.”163 Shurtleff immediately responded asking: “Are you still requiring him to resolve ALL civil litigation within the abeyance period?”164 Reed replied, “If you are asking for yourself, the answer is “no”, we’ve modified that somewhat.”165 Reed explained later to us that reference to “asking for yourself” meant that he and Torgensen had become very concerned at that point that Shurtleff was disclosing their internal OAG discussions to someone on Jenson’s team.166 In the same March 19, 2008, email exchange, Shurtleff also explained why he had involved himself in the negotiation process. Shurtleff stated: I’m sure you’ll understand that I just need to know the facts and since my name and reputation will be forever linked to any plea agreement, I need to know what the final provisions are before I give my final approval.
Id. See Email from Mark Shurtleff to Scott Reed et al. (March 11, 2008, 5:40 pm), App. 534. 160 Id. 161 See Email from Scott Reed to Kirk Torgensen (March 11, 2008, 8:00 am), App. 534. 162 See Email from Mark Shurtleff to Scott Reed et al. (March 19, 2008, 4:05 pm), App. 536. 163 See Email from Scott Reed to Mark Shurtleff (March 19, 2008, 6:08 am), App. 536. 164 See Email from Mark Shurtleff to Scott Reed et al. (March 19, 2008, 6:14 pm), App. 536. 165 See Email from Scott Reed to Mark Shurtleff (March 19, 2008, 6:18 am), App. 536. 166 Scott Reed Interview.
Shurtleff later asked Reed to call him before Reed gave final approval. Shurtleff’s actions were inconsistent with his lack of involvement in other plea agreements that the OAG had handled during his tenure; indeed his involvement was highly unusual.167 Shortly after the email exchange, Reed extended a formal plea offer to Jenson that required him to plead no contest to three third degree felonies.168 The plea would be held in abeyance for three years during which time Jenson would be required to litigate to conclusion in civil court Ebeling’s claim for $2.5 million;; Jenson would be restricted from “hard money” lending; and Jenson would be required to provide his federal tax filing to verify the sources of his income. Consistent with the plea deal that Lawson had outlined in his February 29, 2007 email to Shurtleff, the plea offer that Reed formally extended to Jenson did not require Jenson to pay restitution. If Jenson completed all of the conditions within the three-year period, the case would be dismissed. I. Jenson’s Plea Hearings. 1. The April 3, 2008, plea hearing.
Jenson’s first plea hearing was scheduled for April 3, 2008. Leading up to that hearing, all three victims wanted to talk with Reed about the specifics of the plea agreement. 169 Upset that he would be receiving no restitution under the plea agreement, Ebeling sent an email to Reed questioning the lack of restitution, and asking, “Why have you given in to not making him [Jenson] make restitution.”170 Ebeling went on to say that the current plea deal would be seen as a “victory” to Jenson and that it would ruin the victims financially to allow Jenson three years to pay restitution.171 On the day before the hearing, Mark James emailed Rob Stahura (a non-lawyer, Shurtleff contributor who was part of the informal team) telling him “You have done incredible work.”172 James copied Jenson on the email.173 Attached to the email was a copy of the plea agreement that the OAG had formally offered to Jenson.174 On the day of the plea hearing, Shurtleff asked Reed to let him know “ASAP” how things went with the judge.175 Before the hearing, Reed told Skordas that he anticipated “some heat” from the victims, and suggested that they should give Judge Reese advance notice so he would not be “hit cold with these issues.”176 At the hearing, Judge Reese refused to accept the plea in
Interview with Craig Barlow, on Feb. 28, 2014 (“Craig Barlow Interview”);; Scott Reed Interview;; Charlene Barlow Interview; Kirk Torgensen Interview. 168 See Email from Scott Reed to Morty Ebeling (April 1, 2008, 12:04 pm), App. 538. 169 See Email from Scheree Wilcox to Scott Reed (March 24, 2008, 2:51 pm), App. 539. 170 See Email from Morty Ebeling to Scott Reed et al. (April 1, 2008, 2:48 pm), App. 540. 171 Id. 172 See Email from Mark James to Rob Stahura et al. (April 2, 2008, 11:30 am), App. 542. 173 Id. 174 Id. 175 See Email from Mark Shurtleff to Scott Reed (April 3, 2008, 9:54 am), App. 544. 176 See Email from Scott Reed to Mark Shurtleff et al. (April 3, 2008, 2:56 pm), App. 545.
abeyance deal,177 and gave the victims until April 17, 2008, to file written objections and submit comments to Reed and Jenson.178 Judge Reese then scheduled a further hearing on the issue for May 1, 2008.179 Following the hearing, Reed gave Shurtleff and Torgensen a detailed report.180 Shurtleff thanked Reed “for putting up with all the BS thus far.”181 Torgensen told Reed that this was what he had expected and apologized that Reed was the one “going through the bullshit while the boss sits on the sideline waiting for reports back.”182 Torgensen thought Reed had “done a great job under very tough conditions.” 183 When Torgensen offered to go to the next hearing with Reed, Reed declined thinking it would only further contribute to the rumors regarding the plea negotiations.184 Based on the belief that Mark James had already told Shurtleff that Reed “was intentionally making the deal too harsh for Jenson to comply with so they’d be forced to go to trial,” Reed was concerned about the scenario that might occur if Jenson thought the OAG killed the deal. 185 Reed preferred that Judge Reese rather than the OAG “kill the deal unless Jenson [owns] up to the victims.” 186 Reed then told Torgensen that the plea deal was “just so wrong,” and that when asked by people why he was doing what he was doing, he “[had] a hard time coming up with an answer without telling the truth or telling a lie.”187 Torgensen sympathized, stating, “This one has bothered me terribly.”188 2. The May 1, 2008, hearing and the court’s rejection of the plea deal.
Before the hearing, each of the three victims, Bodell, Ebeling, and White, had submitted letters to the OAG and Judge Reese. At the May 1, 2008 hearing, Judge Reese noted how unusual it is for a judge to inquire into the terms of a plea in abeyance agreement. But in this case, Judge Reese questioned if the plea in abeyance truly served the interests of justice. Reed described the nature of the negotiations in the case as “peculiar.” 189 Judge Reese asked Reed if he felt comfortable with the present agreement after Reed had viewed the victims’ letters.190 Reed responded, “That’s a great question, and I wish I had a great answer, and I don’t.”191 Reed later conceded that “This agreement does not serve all the interests of justice;; it serves some; it serves them adequately, given my perspective of the parties as a whole . . . .”192
Under Utah law, while prosecutors and defendants can negotiate plea arrangements, a trial judge has the final decision and can refuse to accept a plea if it does not serve the interests of justice. See Utah R. Crim. P. 11(e). 178 See Email from Scott Reed to Mark Shurtleff et al. (April 3, 2008 2:56 pm), App. 545. 179 After the hearing Terry Diehl contacted Shurtleff in order to advocate for Jenson. See Email from Terry Diehl to Mark Shurtleff (April 22, 2008, 5:07 pm), App. 548. 180 Id. 181 See Email from Mark Shurtleff to Scott Reed (April 3, 2008, 3:02:01 pm), App. 549. 182 See Email from Kirk Torgensen to Scott Reed (April 3, 2008, 4:39:59 pm), App. 551. 183 Id. 184 See Email from Scott Reed to Kirk Torgensen (April 3, 2008, 5:25 pm), App. 550. 185 Id. 186 Id. 187 See Email from Scott Reed to Kirk Torgensen (April 3, 2008, 5:42 pm), App. 550. 188 See Email from Kirk Torgensen to Scott Reed (April 3, 2008, 5:46 pm), App. 550. 189 See Video of May 1, 2008 Plea in Abeyance Hearing at 7:36. 190 Id. at 16:40. 191 Id. at 17:08. 192 Id. at 19:32.
Judge Reese rejected the plea offer and set a jury trial for May 27, 2008. Torgensen recounted in his interview that he and Reed “were not disappointed.” Charlene Barlow was back on the case, because now it was going to trial – which from their perspective was the right way to resolve the matter. On the day after Judge Reese’s rejection of the plea, Reed emailed Torgensen, anticipating further developments: “Nice – I think this is the start of another campaign with the AG.”193 Torgensen responds: “Oh boy. They are going to claim you tanked this on purpose. I should be hearing from Mark [Shurtleff] soon.”194 We later asked Reed if he was trying to “tank” the deal. Reed told us he felt that he was in an extremely awkward position. Essentially, he said he was “trying to sell a bag of crap to the court.”195 Reed said he was “trying to be candid with the court – telling the truth, without telling the truth.” Reed told us that he did not view the plea as illegal or unethical – instead, from his perspective, it was “just wrong.”196 But Shurtleff was his boss and so he had to present the proposed arrangement on behalf of the State. “This was the product I was given,” he told us. Reed commented that, with the benefit of hindsight, perhaps he should not have presented it. Judge Reese’s rejection of the no restitution plea deal prompted a flurry of activity. In the weeks that followed, Jenson’s attorney, Eric Pearson, a member of the informal team, met with Ebeling’s counsel in an effort to negotiate a deal that would be acceptable to Ebeling.197 Similarly, Mark James, another member of the informal team, met with Bodell to discuss restitution terms.198 Once again, Jenson’s formal team and his informal team proceeded on parallel tracks. Shurtleff was still involved. At one point, Shurtleff told Torgensen that if Skordas called to “please consider what he had to say.”199 Torgensen responded to Shurtleff that they should just proceed to trial scheduled for that Tuesday, May 27, 2008, instead of trying to go back to court with a deal the victims were against, which would be “the kiss of death.”200 On May 27, 2008, instead of proceeding to trial, Barlow, Skordas, and Hyde appeared before Judge Reese and stipulated to continue the trial and set a plea hearing for May 29, 2008. On May 28, 2008, Barlow asked Reed and Torgensen about the current plea deal and Reed responded that he had just received the plea agreement from James. 201 Reed questioned why James, a civil attorney, was drafting the agreement.202 Ebeling also informed Reed and Barlow that he had a side deal with Jenson for periodic payments.203 Bodell and Ebeling approved the plea agreement but apparently made separate side deals with Jenson for restitution that did not get incorporated into the plea agreement.204 The terms of these side deals are not clear, although
See Email from Scott Reed to Kirk Torgensen (Mary 2, 2008, 6:44 am), App. 552. Id. 195 Scott Reed Interview. 196 Scott Reed Interview. 197 See Email from Charlene Barlow to Greg Skordas (May 27, 2008, 3:55 pm), App. 533. 198 See Email from Kirk Torgensen to Scott Reed (May 23, 2008, 11:26 am), App. 554. 199 See Email from Kirk Torgensen to Scott Reed (May 24, 2008, 11:31 am), App. 554. 200 Id. 201 See Email from Charlene Barlow to Scott Reed et al. (May 28, 2008, 1:13 pm), App. 555. 202 See Email from Scott Reed to Charlene Barlow et al. (May 28, 2008, 1:18 pm), App. 555. 203 See Email from Charlene Barlow to Scott Reed (May 28, 2008, 2:22 pm), App. 555. 204 Scott Reed Interview.
we understand they may have involved an agreement by Jenson to make scheduled partial payments to Bodell and Ebeling. 3. The May 29, 2008, plea hearing and the court’s acceptance of Jenson’s plea.
At the May 29, 2008, hearing Judge Reese finally accepted the plea agreement, and Jenson entered a no contest plea in abeyance to three counts of sale of an unregistered security and agreed to pay court costs of $15,000 and restitution of $4.1 million to the victims. This agreement also had a specific provision that allowed Jenson to remain involved in the Mt. Holly project. In response to Judge Reese’s questions, Jenson acknowledged that he understood the document, was not confused about agreement, and was not acting under duress in entering the plea. Jenson agreed that what he was doing was voluntary and that there had been no threats, coercion, or any other unlawful influences to induce him to accept the agreement. And, at the end of the hearing, Jenson formally entered his plea of no contest to three third degree felonies. The plea was held in abeyance and Jenson was given three years to pay to Bodell and Ebeling at total of $4.1 million in restitution. J. Jenson’s Meetings With Shurtleff After The Plea.
According to Jenson, he and Shurtleff met at Red Rock Café in Salt Lake City two or three days after he entered his no contest plea. Lawson arranged the meeting. According to Jenson, Shurtleff told him “I apologize for everything. I hope you forgive me.” Shurtleff asked what his plans were and when Jenson said he was going to California to make some money, Shurtleff said he wanted to meet Jenson’s wealthy friends down there. Jenson says Shurtleff also told him to keep paying Lawson and Swallow in words to the effect of, “Keep doing what you’re doing.” With regard to the $4.1 million owed in restitution, Shurtleff said essentially “we’ll talk about it.” Shurtleff told Jenson he had influence and power in California through the National Association of Attorneys General. Shurtleff concluded by saying that “I want to be part of your world.” Jenson perceived this as a threat.205 Shortly after his plea in abeyance, Jenson went to California. He was having problems renting office space and raising money for Mt. Holly because of reports of his recent plea. He said that he had his lawyers prepare a two-page document entitled “Summary of State of Utah v. Marc S. Jenson.” The document set forth Jenson’s version of his prior dealings with Bodell, Robbins, White, and Ebeling and explained the no contest plea in abeyance and some of the negotiations that led up to it. The document states that Jenson was not guilty but agreed to the deal to avoid the expense and uncertainty of challenging the charges. It concluded by suggesting that the reader contact his lawyers—Eric Pearson, Mark James, John Swallow, or Greg Skordas. Jenson then used the document when the subject of his plea was raised.206
Marc Jenson Interview Marc Jenson Interview; See also Document titled “Summary of State of Utah v. Marc S. Jenson,” App. 556. It is not clear who prepared this document.
Jenson moved to Newport Beach, California, where he resided in a villa at the luxurious Resort at Pelican Hill and rented two others for entertaining guests. The villas cost $20,000 per month to rent.207 Jenson continued to promote and develop his Mt. Holly project. At one point Jenson used the events of the plea negotiation process and his final plea deal as a selling point. In a July 28, 2008, email from Marc Jenson to Jeff Donner, Jenson bragged about his plea deal with Utah stating: “[t]hey dismissed every charge they filed against me, I agreed to pay some money only after they gave me a deal that required no money and the judge wouldn’t sign it.” 208 Jenson went on to encourage Donner to finalize his transaction with Mt. Holly and buy in completely.209 During this time, Shurtleff maintained contact with elements of Jenson’s informal legal team and Jenson’s employee, Paul Nelson. Shurtleff included Swallow and Lawson, as campaign staff, and Jeremy Johnson, Stahura, and Robbins, as major contributors, on an invitation list for Shurtleff’s 2009 inauguration.210 On December 14, 2008, Shurtleff emailed Helen Petersen, his assistant, to call Paul Nelson to set up a lunch for just the two of them sometime before Christmas.211 As of late March 2009, Lawson was continuing to work on behalf of Jenson and was also involved in the Mt. Holly Club.212 Lawson used his relationship with Shurtleff as a reference to legitimate Mt. Holly and himself, telling one investor, Donner, to contact Shurtleff personally and providing Shurtleff’s official email address.213 We also received uncorroborated information from Jenson concerning Swallow’s involvement in the events around this time. Jenson said that Swallow, who was still in private practice, showed up at Jenson’s office.214 Jenson did not know Swallow, but Rob Stahura had told him that Swallow would be paying him a visit. Jenson says that Swallow told him: “I know you have been meeting with Tim Lawson. I will be another conduit [to Shurtleff]. I’m going to run for AG. Shurtleff is going to hire me. I’m going to take care of you when I’m AG. The only way I can do it is with a cut in pay so I have to make some money now.”215 Then Swallow reportedly took out his cell phone, said: “I understand this is necessary,” dialed a number and handed the phone to him. Jenson said that Shurtleff was on the line and the conversation proceeded as follows: MS: MJ: “Hello Marc, this is Mark.” “Have we made any progress? Am I closer to where I want to be?”
Marc Jenson Interview. See Email from Marc Jenson to Jeff Donner (July 28, 2008, 11:11 am), App. 558. 209 Id. 210 See Email from Mark Shurtleff to Paul Murphy (Dec. 1, 2008, 1:06 pm), App. 559. 211 See Email from Mark Shurtleff to Helen Petersen (Dec. 15, 2008, 7:55 am), App. 560. 212 See Email from Tim Lawson to unknown recipient (redacted) (March 24, 2009, 5:20 pm), App. 561. Although the recipient is redacted we assume Tim Bell was one of the recipients because he later replied to Lawson’s email. 213 Id. 214 We had difficulty identifying the exact date of this alleged event. 215 Marc Jenson Interview.
“Yes you are. Swallow is a good man. He will be the next AG. I’m bringing him into the office and he’ll be able to help you from inside the office. Make sure you take care of him.”216
We attempted to speak with Shurtleff and Swallow regarding these and other allegations made by Jenson. Through their attorneys, Shurtleff and Swallow both declined our requests for an interview. Following the phone call, Swallow allegedly started making demands of Jenson. According to Jenson, he first asked for a $200,000 retainer. When Jenson balked, Swallow allegedly lowered it to $100,000. These conversations are uncorroborated. Jenson also said that Swallow asked for a membership at Mt. Holly to “take care of my family.” Jenson says he agreed to this demand and gave Swallow a membership in the club that, according to Jenson, was worth $1.5M.217 We have seen no documentation to corroborate the transfer or receipt of the property. Paul Nelson said that Swallow told him that he had received the promise of a Mt. Holly membership.218 K. Shurtleff and Swallow’s First Trip to Pelican Hill.
On May 5, 2009, Shurtleff, Swallow, and Lawson first stayed at Pelican Hill at Jenson’s expense.219 Shurtleff stayed only a few days, returning back to Salt Lake in time for a May 8, 2009, lunch meeting with Darl McBride.220 Jenson paid all of Shurtleff’s and Swallow’s expenses, including their lodging in the expensive villas, golf outings, meals, and massages. According to Jenson, his associate, Peter Torres, booked all the flights then gave money to Tim Lawson to pay for the flights. This was done because Shurtleff did not want it to appear to have been paid directly by Jenson. Jenson told us that the payment arrangements became “cloak and dagger” so that it would not appear that he (Jenson) was paying for Shurtleff’s trip. According to the House Report the primary purpose of this initial trip was fundraising for Shurtleff, and Shurtleff publicly stated that he went there to finish his book.221 Jenson told us that he met with Shurtleff and Shurtleff “dove right in.” Shurtleff explained that he was going to make a run for a Senate seat and he needed money.222 Shurtleff had calculated exactly how
Id. Id. 218 Interview with Paul Nelson on March 19, 2014 (“Paul Nelson Interview”). 219 See State’s Criminal Information, State of Utah v. Timothy William Lawson, Utah Third District Ct. No. 13026985 (filed Dec. 12, 2013) at 6, App. 563. We have not tried to identify the exact dates of the trips, as they are not critical to our report. We met with Jenson in the Davis County Jail, so we also did not have available to us at the time of the interview documents that would have allowed to try and better pinpoint time frames. As a result, all of the dates we recount regarding Pelican Hill should be regarded as tentative, subject to more accurate information that we understand is available elsewhere. 220 Search Warrant Affidavit #14190003, pg. 18-19, ¶ 48-50. 221 Special Investigative Committee: Utah House of Representatives, Report of the Special Investigative Committee, March 11, 2014, at 186, available at http://le.utah.gov/investigative/investigativecomm.jsp (last visited March 29, 2014). 222 On May 20, 2009, Mark Shurtleff publicly announced that he was entering the Senate race for the seat then held by incumbent Bob Bennett.
much money he would need to make a successful run for the seat. Jenson said that Shurtleff wanted to meet Jenson’s wealthy investors in southern California.223 Jenson also told us that he spent a lot of time with Shurtleff during the first trip. As Jenson recounted, Swallow was at Shurtleff’s side for much of the trip, but Shurtleff did 95% of the talking while Swallow stood by nodding. L. Shurtleff’s Meeting With Darl McBride After Returning From Pelican Hill.
On May 8, 2009, immediately after Shurtleff’s initial trip to Pelican Hill, Shurtleff and Darl McBride met at Mimi’s Café on State Street in Sandy City. 224 The subject of their discussion related to Jenson. By way of background, several months before McBride and Shurtleff met at Mimi’s Café, McBride had filed a lawsuit against Mark Robbins. McBride and Robbins had a falling out over a business venture and McBride alleged that Robbins owed him money. McBride had also established a website disparaging Robbins. Robbins was a major supporter and campaign contributor of Shurtleff. At the May 8, 2009, meeting with McBride, Shurtleff proposed using Jenson to help Robbins resolve his differences with McBride. McBride recorded the conversation, and later provided a copy of the recording to the Federal Bureau of Investigation. Shurtleff asked McBride, "What can I do?"225 McBride told Shurtleff that he needed $2 million. Shurtleff asked him if he knew Jenson and stated that he believed Robbins was not good for the money but Jenson was.226 Shurtleff offered to get Jenson to pay McBride the $2 million because he had a “weird relationship” with Jenson.227 “He’s got every motivation in the world.”228 “I’m going to shut down my team on him [Jenson].”229 Shurtleff told McBride that if he got the money he had to promise that would be the end of it.230 Shurtleff also acknowledged at that this meeting that he knew that Lawson used his name and told people that he represented the Attorney General. Shurtleff stated “he’ll use me for different things.”231 M. Shurtleff’s Second Trip To Pelican Hill.
According to Jenson, Shurtleff made a second trip to Pelican Hill in about June 2009.232 During the course of our investigation, we found a posting by Jenson’s wife, Stori Jenson, on the social media website Twitter that supports Jenson’s allegation regarding a June 2009 trip. Her posting, more commonly known as a “tweet,” is dated June 8, 2009. Her June 8, 2009 , tweet states “. . . so so funny! crazy weekend here. Church with Michele and natalie and shurtluff [sic]! What planet is this?”233 Consistent with this tweet, Jenson also told us that, during one of his
Marc Jenson Interview. Search Warrant Affidavit #14190003, pg. 18-19, ¶ 48-50; Robert Gehrke, Secret Recording: Mark Shurtleff Offers $2 Million to Silence Critic, Salt Lake Tribune, May 24, 2013. 225 Id. 226 Id. 227 Id. 228 Id. 229 Id. 230 Id. 231 Id. 232 Marc Jenson Interview. 233 A screen capture of Stori Jenson’s twitter posting is attached hereto at App. 617;; see also Twitter posting on June 8, 2009 10:25 am, available at http://twitter.com/storij/statuses/2078508200.
visits, Shurtleff decided to attend church at the same church that Jenson attended. Jenson claimed Shurtleff said something along the lines of “We can’t be seen together, so we’ll sneak in separately.” But then, while they drove to church separately, Shurtleff and his wife came in and sat right next to Jenson and his wife (Stori Jenson). Someone then came up to Shurtleff and said hi, and Shurtleff responded that he had come down to see the Jensons. As Jenson recounted to us, Shurtleff’s visit to the church essentially became a “campaign stop.” Shurtleff started handing out campaign buttons. He also apparently had a picture taken of him and Stori.234 The bottom line, according to Jenson, was that Shurtleff and Swallow were there to “meet money guys.” Jenson also expressed to us his frustration at being in this situation. As he described it, he was a sophisticated business person who had been in legal trouble before. He had always hired legal counsel to deal with such situations. But now he had the Attorney General who was prosecuting him also using him personally to campaign. “Nothing was normal anymore,” said Jenson.235 Jenson says that Swallow was also at Pelican Hill during Shurtleff’s second trip, but we have seen no corroboration. Jenson told us that, during this second trip, Shurtleff and Swallow were more aggressive in demanding money. Shurtleff told him that he had to give $2 million to Lawson to pay off McBride so that the problem McBride had with Robbins would go away. When Jenson protested that he did not have the money, Shurtleff told him to get it from his investors. Jenson replied that he had to pay restitution, whereupon Shurtleff told him not to worry about restitution since he (Jenson) was looking at the Attorney General and the next Attorney General. According to Jenson, Shurtleff said “You’ve got cover.”236 And Jenson also claims that he told Shurtleff that he was going to pay the restitution he owed on the very last day of the three-year abeyance period.237 At that point, Jenson said that Shurtleff asked Swallow to excuse himself and then told Jenson that he was under investigation by U.S. Attorney Brett Tolman and asked Jenson to have Paul Nelson contact Tolman, who is Nelson’s cousin. Jenson claims that Shurtleff told him something to the effect of, “If you can get me out of this, you’ll never have another problem with the State of Utah.”238 Following that meeting, Jenson or Lawson called Paul Nelson. According to a sworn declaration from Nelson, in around June 2009, he received a call from Lawson. Lawson explained that Tolman was investigating Shurtleff and requested Nelson to reach out to Tolman and try to get him to drop the investigation. Lawson suggested that if that could happen, it would be very good for Jenson and a way might be found to drop the $4 million restitution obligation. If Nelson did not make the call, Lawson suggested that things would get worse for Jenson, including a potential investigation of the Mt. Holly project.239
Marc Jenson Interview. Id. 236 Id. 237 Id. 238 Id. 239 Declaration of Paul Nelson.
Nelson told us in an interview that Jenson had said Shurtleff was “breaking down” because of the investigation by Tolman. Nelson said that he placed a call to Tolman, but that he did not really want to talk to him. Nelson said it was never really clear to him whether there was actually an investigation by Tolman of Shurtleff.240 Jenson stated that he later received three texts from Shurtleff, confirming some sort of contact between Nelson and Tolman and/or “Tolman’s guy” (presumably a reference to an attorney in the U.S. Attorney’s office). Jenson claims that these texts indicated that Shurtleff was euphoric.241 Jenson also stated that Lawson confirmed an arrangement that, if Nelson could get Tolman to back off, then Jenson would not have to pay any restitution. We have seen no texts and no evidence that Nelson attempted to have any influence on Tolman.242 It appears that on about July 5 and 6, 2009, Swallow again visited Jenson at Pelican Hill, this time without Shurtleff, and again Jenson paid all his expenses. On July 10 and 11, 2009, Swallow returned again to Pelican Hill, this time bringing his wife. It should be noted that Swallow was a private attorney, not an OAG employee. According to Jenson, however, when Swallow felt that he had been stood up by some wealthy golfers with whom Jenson had arranged a game, Swallow said to Jenson something to the effect of: “You have no idea who you are dealing with. You had better respect me. I shape your future.”243 Jenson understood this to be a reference to the fact that Swallow was Shurtleff’s heir apparent. On July 30, 2009, Shurtleff admitted in an email to undisclosed (redacted) recipients that McBride had asked him in May to try and convince Mark Robbins to pay McBride money that McBride claimed Robbins owed him.244 Shurtleff said that he tried, but Robbins refused to even consider it because McBride had said so many derogatory things on McBride’s website. 245 Torgensen had asked Shurtleff if he ever met with McBride on behalf of Mark Robbins and, if so, why. Shurtleff responded in an email dated July 18, 2012, denying that he ever acted as gobetween for McBride.246
Paul Nelson Interview. Marc Jenson Interview. 242 In our opinion, the whole idea that Nelson might be able to have this kind of influence seemed incredible, which Nelson himself confirmed. Nelson also told us that Lawson was continually pressing him to get a chance to meet Tolman. Nelson eventually agreed to set up a meeting. Several days after Tolman left his position as U.S. Attorney and accepted as position as an attorney at a downtown law firm, Nelson arranged what was to be a congratulatory meeting with Tolman (not telling Tolman that Lawson would be coming along). Nelson then brought Lawson to the meeting, whereupon Lawson starting talking about Tolman’s personal life. Tolman did not like it and quickly terminated the meeting. After Lawson left, Tolman asked Nelson why he had brought Lawson along, because he had the sense that Lawson was trying to shake him down. Nelson felt embarrassed. Nelson also indicated that, at all times, Tolman was extremely professional trying to keep professional and family relations completely separate, which is he why he felt so embarrassed in bringing the “scumbag” Lawson with him. See Paul Nelson Interview. 243 Marc Jenson Interview. 244 See Email from Mark Shurtleff to unknown recipients (redacted) (July 30, 2009, 5:49 pm), App. 618. We were unable to obtain an unredacted version of the email. 245 Id. 246 See Email from Mark Shurtleff to Kirk Torgensen (July 18, 2012, 9:48 am), App. 619.
Shurtleff’s Trips to California Become Known in the OAG.
While it appears to be undisputed now that Shurtleff (and Swallow) visited Jenson in Pelican Hill several times in the May – July 2009 period, we have seen no evidence that these trips were contemporaneously disclosed to other attorneys in the OAG. However, knowledge of the trips began to percolate into the office several months later. Scott Reed recalls that he first learned about Pelican Hill from Tracy Tabet, an employee in the OAG who was very savvy with social media. She mentioned that she had access to Stori Jenson’s Twitter (perhaps Facebook) account and that she had seen a photograph of Mark Shurtleff and Stori Jenson together. On July 30, 2009, Paul Murphy, then Communications Director, emailed Shurtleff and Torgensen the text of Stori Jenson’s June 8, 2009 tweet. 247 As discussed above, the tweet states that Shurtleff attended church with Jenson and his wife on June 8, 2009.248 On September 23, 2009, Reed asked Torgensen whether Shurtleff had been in California in the beginning of May.249 Reed had spoken with Ebeling, who was told by Lawson that Shurtleff met with Jenson in California around Cinco de Mayo, and that Lawson was there with them when the meeting occurred.250 Reed’s email also mentions Shurtleff’s meeting in June where Shurtleff went to church and had lunch with Jenson.251 Reed believed that these meetings were highly improper. He also felt that he had done the right thing in reporting these improper contacts to his boss, Torgensen.252 Torgensen has a very clear recollection of when he first learned that Shurtleff had visited Jenson in California. Torgensen received a telephone call from John Daley, a reporter at KSLTV. Torgensen had interacted with Daley previously and knew he was a reliable person. Daley essentially asked Torgensen, “What was your boss doing at a fancy resort in California with Marc Jenson?” Torgensen recalls that he did not know what to say. He did not believe that it was true, but Daley assured him that it was.253 Torgensen then made a call to Shurtleff.254 Torgensen described it as a very heated call, during which Torgensen essentially asked Shurtleff “What the hell did you do that for?” Shurtleff responded, “All I did was have dinner with him and told him to pay his restitution.” Torgensen replied in essence, “That is BS. Is that really what you are going to tell the world?” Torgensen’s impression was that this struck home with Shurtleff, who stopped being cocky about the situation. Shurtleff conceded that there might have been a bit more to it. Shurtleff indicated
See Email from Paul Murphy to Mark Shurtleff et al. (July 30, 2009 4:55 am), App. 618; Twitter posting on June 8, 2009, 10:25 am at http://twitter.com/storij/statuses/2078508200, App. 617. 248 See supra subsection M; see also Twitter posting on June 8, 2009, 10:25 am at http://twitter.com/storij/statuses/2078508200, App. 617. 249 See Email from Scott Reed to Kirk Torgensen (Sep. 23, 2009, 3:09 pm), App. 620. 250 Id. 251 Id. 252 Scott Reed Interview. 253 Kirk Torgensen Interview. 254 We believe that this call would have been around September 23, 2009. In the next section we discuss an email between Reed and Torgensen that references a “channel 5” reporter, as well as Reed and Torgensen’s lack of awareness of Shurtleff’s meeting Jenson in California.
that he had talked to Jenson about having Jenson help with selling movie rights to his book on Dred Scott.255 Torgensen indicated that Shurtleff apparently believed that if he could get his book on to the Oprah Winfrey Show, then it would be marketable as a movie and his financial problems would be solved.256 Torgensen was very bothered that the Utah Attorney General had apparently flown to California and met with someone that Office had just prosecuted for serious felonies (and was currently under the OAG’s informal supervision on a plea in abeyance). The matter was sufficiently troubling that he felt he had to talk to other trusted people about the situation. So Torgensen called Mike Sibbett, with whom he had previously interacted when Sibbett was on the Utah Board of Pardons and Parole. He also talked to Stan Parrish. Torgensen recounted in his interview that he simply could not fathom why Shurtleff was meeting, privately, with a defendant that the office had just prosecuted. This subject was very upsetting to other senior members of the OAG who were located at College Drive. Not only was Torgensen extremely bothered by it, but so were Scott Reed, Craig Barlow, Ken Wallentine, Leo Lucy, and Tracy Tabet.257 It became a major topic of discussion, particularly in light of the fact that it was expected to be aired during Shurtleff’s anticipated challenge to incumbent Senator Bob Bennett. Senator Bennett’s campaign had hired a law firm that was filing numerous requests under Utah’s Government Records Access and Management Act (GRAMA) regarding the Jenson matter.258 Wallentine also recalled that around this time, Shurtleff was working on his Dred Scott book. Shurtleff learned that Wallentine had recently published a book and talked to him about the writing and publishing process. Wallentine mentioned the importance of blocking out time to write. Shurtleff told Wallentine, “I have a friend in Southern California with a condo.” In retrospect, Wallentine told us, he believes that this was a reference to Pelican Hill and that Shurtleff was obliquely describing Jenson as a “friend” but not mentioning his name directly. Wallentine recounted to us that the general reaction in the OAG to the idea that Shurtleff was actually visiting Jenson in California was astonishment: “No, it can’t be true.” But that impression shifted when word began to circulate of a social media photograph of Mark Shurtleff and Stori Jenson together. Wallentine was quite surprised how the story was panning out. An experienced law enforcement officer, Wallentine told us: “Cops don’t like coincidences. Something was rotten in Denmark.” Wallentine recalled in his interview with us that his impression was that Torgensen and Reed were also surprised and angry – they thought Shurtleff had definitely turned some kind of corner with Jenson. Wallentine also recalled that, according to Torgensen, Shurtleff was
In the acknowledgement section of his book, Shurtleff thanked Tim Lawson for “motivate[ing] me with his ‘no holds barred’ approach to life.” See MARK L. SHURTLEFF, AM I NOT A MAN? THE DRED SCOTT STORY (Valor Publishing Group 2009). 256 Kirk Torgensen Interview. 257 Kirk Torgensen Interview; Ken Wallentine Interview; Scott Reed Interview. 258 Kirk Torgensen Interview.
claiming (quite implausibly) that he had just happened to run into Jenson in California and that he had only told Jenson to pay his restitution.259 Shortly after the Jenson meetings began being discussed more widely, Shurtleff announced that he was withdrawing from the Senate race. He cited personal reasons involving his family as the basis for that decision. O. XE Capital Foreclosure.
Immediately following Shurtleff and Swallow’s first trip to Pelican Hill in May 2009, Jenson and his associates began asking Shurtleff to take official action to protect their investment in the Mt. Holly development. By May 2009, XE Capital, a New York-based hedge fund, that purchased debt issued by the Mt. Holly Club, had foreclosed on the property and was planning to purchase it through a foreclosure sale. The events that immediately precede and follow the foreclosure of the Mt. Holly Club by XE Capital lead to questions about the timing of efforts to stop the foreclosure. Those efforts coincide closely with Shurtleff and Swallow’s first visit to Pelican Hill. In an attempt to stave off the sale, Jenson sought the assistance of the OAG. On May 7, 2009, immediately following Swallow’s and Shurtleff’s first visit to Pelican Hill, an attorney for Jenson copied Swallow on an email to Shurtleff attaching a formal complaint against the principal of XE Capital, and another investor in the property.260 After a federal judge denied the Mt. Holly Club’s motion for an injunction prohibiting the sale of the property, Steven Jenson, Marc Jenson’s brother, emailed Shurtleff with copies to Swallow and Lawson.261 Steven Jenson asked the OAG to investigate XE Capital’s actions against Mt. Holly. Steven Jenson wrote: “I am now appealing to your office to help stop this theft from continuing to occur.”262 Steven Jenson also forwarded Shurtleff a synopsis of the decision that Mark James had sent individually to Marc Jenson and Swallow earlier in the day.263 This email was shortly followed by an email from Tim Bell to Shurtleff.264 Bell also asked for OAG intervention into XE Capital’s actions against Mt. Holly. 265 Bell’s email also forwarded an email from Mark James to Marc Jenson, describing the Mt. Holly situation and hearing before Judge Campbell.266
Ken Wallentine Interview. Wallentine and Torgensen continued to discuss the difficult position they were in during the ensuing months. On December 9, 2009, Wallentine stated: “As long as Mark doesn’t ask me to do anything plainly illegal or unethical, he gets to call the shots. Even if I don’t think it is politically smart or the fundamental best choice. … Mark’s disappointment with my work will have to wait.” Email from Ken Wallentine to Kirk Torgensen (Dec. 9, 2009, 11:04 am), App. 621. 260 Marc Jenson Interview. 261 See Email from Steve Jenson to Mark Shurtleff et al. (May 22, 2009, 3:02 pm), App. 623. 262 Id. 263 Id. 264 See Email from Tim Bell to Mark Shurtleff (May 22, 2009, 3:45 pm), App. 625. 265 Id. 266 Id.
Five days later, on May 27, 2009, a screening committee met and, based on Doug Townsend’s investigation, determined that there was no reason to believe that O’Neel and Gadbaw (initial targets of the investigation) committed fraud in regards to Mt. Holly.267 In attendance were Torgensen, Reed, Craig Barlow, Charlene Barlow, P. Nolan, R. Hamp, J. Kimble, E. Varoz, and Townsend.268 After the complaints had been screened and rejected, Shurtleff thanked Wallentine for looking into the matter and then asked Wallentine, Torgensen, and Reed: Now, I need to know ASAP what specifically are ‘our ongoing investigation into his [Jenson’s] activities, and the likelihood of continued litigation’ as well as details on how ‘he has not honored his agreement and the office may be constrained to take further action against him.’ I have heard nothing of this and last time I inquired understood we had no evidence that he was not complying with his plea in abeyance. It is my understanding from Mark James, they were hoping to get restitution paid and some consideration for completing the plea deal at 18 months.269 Reed responded to Shurtleff, Wallentine and Torgensen: “Mark, I’ll take it from here – please keep this confidential – this is not information that Mr. James is entitled to or needs.” Reed was concerned that Shurtleff was relaying confidential information directly to Jenson’s attorneys. Reed then explained the investigation into Mt. Holly and that Jenson had not made any restitution. 270 Reed also mentioned that the OAG was acting as Jenson’s informal “probation officer.”271 Torgensen then thanked Reed, presumably for handling Shurtleff’s request.272 Reed responded to Torgensen: “Are you impressed with my diplomacy and restraint? It was hard, but I did it.”273 Reed’s September 23, 2009 email to Torgensen provides possible insight into the events that followed Shurtleff’s May 5 Pelican Hill visit. Reed told Torgensen that Shurtleff had visited Pelican Hill several times and had meetings with both Jenson and Lawson present. According to Reed’s email: This coincides with Mark’s directive to put a bunch of Mounty [sic] Holly complaints on a fast track, involving Steve Jenson and others, who were claiming to have been bilked by some very bad men out of New York, Mark put those complaints on May 8, arguably after having his meeting with Jenson and Lawson and getting an earful about Mt. Holly and probably saying something like ”Put it
See Email from Ken Wallentine to Mark Shurtleff (May 29, 2009, 2:07 pm), App. 627. See OAG Investigation Report at 8 (printed July 23, 2013), App. 635. 269 See Email from Mark Shurtleff to Ken Wallentine et al. (May 29, 2009, 2:17 pm), App. 627. 270 See Email from Scott Reed to Mark Shurtleff et al. (May 29, 2009, 2:55 pm), App. 638. 271 Id. 272 See Email from Kirk Torgensen to Scott Reed (May 29, 2009, 3:11 pm), App. 638. 273 See Email from Scott Reed to Kirk Torgensen (May 29, 2009, 3:25 pm), App. 638.
in writing and I’ll give it to my investigators, and in the meantime I’ll call my good friend AG Cuomo in New York and get something going for you.”274 Reed did not present his thoughts as incontrovertible evidence of wrongdoing by Shurtleff and qualified his earlier statement with the conclusion: “Interesting, if true. Whether it’s true or not, Channel 5 has it, which means that everybody who cares has it too, and it will come out sometime during the campaign.”275 Nonetheless, Torgensen can be criticized for not conducting a further investigation or going to independent authorities once he learned of the highly irregular and troubling conduct by Shurtleff.276 There was another coordinated effort in November 2009 asking for the assistance of the OAG – this time with the Mt. Holly foreclosure auction. Over the course of two days Shurtleff received emails from Tim Bell, Steven Hansen, and Eric Margarida, with Lawson copied on each, asking for OAG assistance with the Mt. Holly auction. 277 On November 20, 2009 Shurtleff responded to Bell that he had forwarded his email and the others to the criminal and investigative divisions and had asked them to take another look at the possibility of opening up an investigation.278 There is no record that Shurtleff again asked about opening up an investigation, but this demonstrates the continued direct connection that Jenson and his associates had with Shurtleff and his willingness to act on their requests. Coincidentally, the day before, on November 19, 2009, attorney Daniel Wadley emailed Reed a copy of a draft complaint on behalf of Donner against Jenson and others involved with Mt. Holly.279 P. The OAG Took No Action Regarding Jenson’s Restitution For More Than One Year.
After Jenson entered his plea on May 29, 2008, it appears that for more than a year the OAG took little action on the case. By its terms, the plea agreement did not require Jenson to do anything until three years later, at which point the obligation to pay restitution became due. It appears that the OAG anticipated that, if anything, Jenson might make the restitution payments earlier. During the plea negotiations Jenson’s defense attorneys had been pressing OAG about the possibility of ending the plea in abeyance early if Jenson paid his restitution early. 280 Reed recalled that during the negotiations, Jenson’s team of attorneys had often pressed for some sort of “early out clause” that would allow him to pay restitution early and have the case dismissed.
See Email from Scott Reed to Kirk Torgensen (Sep. 23, 2009, 3:09 pm), App. 640. Id. 276 There is no question that Torgensen disapproved of Shurtleff’s conduct but he may have felt vulnerable sin ce Shurtleff had appointed him to serve as Chief Deputy and, as such, Shurtleff had discretion over his tenure, salary and bonus. We do not know whether Torgensen had a merit position to fall back on if he were to lose the position of Chief Deputy. Losing the position of Chief Deputy would have meant a reduction in salary. 277 See Email from Tim Bell to Mark Shurtleff et al. (Nov. 16, 2009, 6:24 am), App. 641; see also Email from Steve Hansen to Mark Shurtelff (Nov. 17, 2009, 7:43 am), App. 642; Email from Tim Bell to Mark Shurtleff (Nov. 17, 2009, 8:55 am), App. 643; Email from Eric Margarida to Mark Shurtleff (Nov. 17, 2009, 3:21 pm), App. 644. 278 See Email from Mark Shurtleff to Tim Bell (Nov. 20, 2009, 9:09 am), App. 646. 279 See Email from Daniel Wadley to Scott Reed et al. (Nov. 19, 2009, 4:10 pm) (attaching draft motion), App. 648. 280 Kirk Torgensen Interview.
In any event, based on our review of court filings and OAG emails, there was a lull in the OAG’s involvement in the Jenson case following the entry of his plea. The OAG took no formal action to pursue his payment of restitution until October 9, 2009. 281 Jenson did not make any restitution payments during this time. Q. Jenson’s Bank Records Show Significant Financial Resources and Payments to Lawson During the Term of the Plea in Abeyance.
During our investigation, we obtained from the OAG summaries of Jenson’s bank activity. Since we do not have subpoena power, we were unable to obtain Jenson’s bank records directly from the banks. As such, we cannot independently verify the OAG’s summaries. Those summaries, however, indicate that Jenson had millions of dollars flowing through his bank accounts after he entered his plea and during the abeyance period.282 Notably, the Jenson bank information provided by the OAG also shows that, from January 30, 2009, through July 15, 2009, Jenson transferred a total of $114,300 to Tim Lawson’s company, Apple Dumpling Gang Investments.283 R. The OAG’s Efforts to Pursue Jenson’s Compliance with Restitution Obligations.
During the latter part of 2009, the OAG became more active in pursuing Jenson’s restitution obligations. In July or August, 2009, Reed noticed that Jenson had not provided his tax returns, as required by the plea agreement. He contacted Jenson’s defense attorneys to request the returns and was promised that they would be provided.284 Whether Jenson actually did provide his tax returns is unclear. Reed also thought it would be a good idea to have a review hearing to see how Jenson was doing on his restitution payments. He contacted Skordas and asked if Jenson would agree to a hearing. Months went by and Reed did not hear anything. Meanwhile, Reed learned of complaints against Jenson by Grant Lee in Idaho. Reed referred Lee to the Idaho Division of Securities. During this time, Reed also received complaints from Ebeling that he had not been paid anything.285 While initially Reed had not intended to file anything on Jenson’s restitution obligation until the three-year period expired, he began to grow concerned that no payments were being made. Essentially Reed viewed himself as Jenson’s informal probation officer during the threeyear plea in abeyance period, as no court supervision was provided. On October 9, 2009, Reed filed a request for a status review hearing with the court.286 That same day and after the
State’s Request For A Review/Status Hearing at Third District Court (filed Oct. 9, 2009), available at App. 687. The Jenson bank account summaries we received from the OAG are provided at pages 851 through 872 of the appendix. 283 Id. 284 Scott Reed Interview. 285 Scott Reed Interview. 286 See Oct. 9, 2009 docket entry, Jenson I (reflecting filing of State’s motion for an order to show cause and court’ s response thereto by requesting “the reason for the review and how long it may take”).
docketing of the OAG’s request for a status review, the court made a minute entry on the docket which states “the review may be granted, but the court would like to know the reason for the review and how long it may take.”287 The docket also shows that, after October 9, 2009, there was no substantive activity until February 19, 2010. On February 19, 2010, the OAG filed a motion for an Order to Show Cause with the court. The motion, which was signed by Reed, alleged that Jenson had “failed to substantially comply with the terms and conditions of the Plea in Abeyance Agreement.” In support of its motion, the OAG also submitted affidavits from Reed, Morty Ebeling, and Michael Bodell.288 It is not clear whether Shurtleff had any involvement in the October 9, 2009, and February 19, 2010, court filings or whether he was even aware of the filings. Our review of internal OAG emails did not uncover any emails or other documents showing Shurtleff was engaged in restitution issues related to Jenson’s case at the time of these filings. There appears to have been a noticeable shift in Shurtleff’s level of involvement on March 4, 2010. On that day, he emailed Reed and Torgensen, stating: “I asked you last Fall to do an OSC to haul Jenson into court, or do whatever needed to be done to get him into compliance with his Plea in Abeyance. Can you give a report on what you did and what the current status is?”289 Later that day Shurtleff followed up with an email to both Reed and Torgensen writing only: “[k]eep the pressure on him.”290 Both Reed and Torgensen were confused about Shurtleff’s sudden interest in the case, and Reed stated in an email to Torgensen that “. . . the last e-mail communication to me from the AG about Jenson was May 29 of last year. He did not ask for an OSC, and there is no e-mail since asking for an OSC. So where is this sudden interest coming from?”291 Torgensen replied to Reed that “Swallow advised him to cover you know what”292 to which Reed responded with “[w]hat does Swallow know? Weird.”293 Torgensen later told us that he viewed this sudden interest from Shurtleff as a “CYA” effort. Torgensen had the distinct impression that Shurtleff was concerned about all his efforts on Jenson’s behalf catching up to him and he was trying to make a record to show he had been a tough prosecutor of Jenson.295
After March 4, 2010, Shurtleff continued to be engaged with matters related to Jenson. On March 26, 2010, four days after Reed appeared in court on behalf of the OAG for a scheduling conference regarding the motion for an Order to Show Cause, Shurtleff forwarded two emails to Shelley Exeter, Reed, Torgensen, and Wallentine.296 The forwarded emails were
Id. See Motion For Order To Show Cause, Jenson I (filed Feb. 19, 2010), App. 711; see also Affidavit of Scott W. Reed (filed Feb. 19, 2010), App. 713. 289 See Email from Mark Shurtleff to Kirk Torgensen et al. (March 4, 2010, 10:40 am), App. 717. 290 See Email from Mark Shurtleff to Scott Reed et al. (March 4, 2010, 1:21 pm), App. 717. 291 See Email from Scott Reed to Kirk Torgensen (March 4, 2010, 1:12 pm), App. 717. 292 See Email from Kirk Torgensen to Scott Reed (March 4, 2010, 1:28 pm), App. 717. 293 See Email from Scott Reed to Kirk Torgensen (March 4, 2010, 1:31 pm), App. 717. 294 Kirk Torgensen Interview. 295 Kirk Torgensen Interview. 296 See Email from Mark Shurtleff to Shelley Exeter et al. (March 26, 2010, 9:32 am), App. 719.
from Tim and Jennifer Bell. In their emails, the Bells requested that Shurtleff investigate Jenson’s activities regarding the Mt. Holly project and Timothy Lawson’s unwanted contact with Mt. Holly investor Dr. Donner. In forwarding the emails, Shurtleff instructed his subordinates to meet with the Bells before the hearing on the OAG’s motion for an order to show cause, which had been scheduled for June 2, 2010.297 The OAG’s February 19, 2010, filing of a Motion for an Order to Show Cause prompted a series of filings and court hearings regarding Jenson’s efforts (or lack thereof) to pay restitution. The filing also prompted Jenson’s then-attorney, Rebecca Hyde, to have communications with Reed regarding what she perceived to be the OAG’s aggressive litigation of restitution issues long before the end of the abeyance period. When she questioned Reed regarding why the OAG was seeking to have the case brought back to court well before the end of the abeyance period, Reed informed her that he was concerned Jenson was living a lavish lifestyle while paying no restitution.298 S. Lawson and the “House of Cards” Email.
Around this time, the activities of Lawson become the subject of discussion within the OAG. One such email chain is between Reed and Torgensen discussing Lawson calling Jenson victim Morty Ebeling, who had called Reed to alert him to what Lawson was telling him. 299 Reed asserts that Lawson was promising Ebeling that Jenson is making money and working on a payment plan. Lawson also told Ebeling that he (Lawson) was close to Shurtleff and alleging they were traveling together and “doing this and that.”300 Torgensen recounted in his interview that he had talked to Shurtleff several times about Lawson, asking Shurtleff why Lawson kept dropping Shurtleff’s name. Shurtleff would respond to the effect, “That’s the way Lawson is. I’ve asked him not to drop my name. I’ll remind him.” Torgensen recalled that he had talked to Shurtleff about Lawson’s propensity to do so on several occasions.301 Torgensen always received similar responses from Shurtleff, such as “Tim’s a loud mouth. I’ll talk to him.”302 Lawson most famously appears in an OAG email chain on March 2, 2010. The context of this comment may be important, so we set out the chain completely: [Swallow to Torgensen] Hey Kirk, you are not going to like this but Jeremy Johnson is coming to the capitol for a few minutes today to say hello to Dave Clark, who I think is his Representative. You need to know that Jeremy and I got to know each other when I worked as Mark’s campaign finance chair. I told you Mark and I went down there and really checked him out. He’s also given a lot of money to Governor Herbert. So, just a heads up. I know Mark thinks a lot of him
Id. Greg Skordas and Rebecca Hyde Interview. 299 See Email from Scott Reed to Kirk Torgensen (Feb. 3, 2010, 10:42 am), App.721. 300 Id. 301 Kirk Torgensen Interview. 302 Id.
and I don’t put him in the category of Tim. Let’s not give him a key to the office, but let’s also be cool. Thoughts? John.303 [Torgensen to Swallow] Why would I not be cool? You know my concerns and I will of course not be stupid enough to make a point about his visit. I know the Gov’s office has some concern about getting to [sic] close to him.304 [Swallow to Torgensen] I’m just giving you a heads up. I know you are cool. Hey Curtis is here about Noel’s federal officer bill.305 [Torgensen to Swallow] All I can do is pass on to you what I hear. This guy may be the greatest but there is a buzz out there about him. Lawson is the guy that is going to bring the house of cards down.306 With regard to the “house of cards” email, Torgensen told us that he thought it was important to understand that contextually the email was a response to an email from John Swallow. At one of the weekly “Monday meetings” (i.e., senior staff meetings), Torgensen learned that Shurtleff was thinking of giving Jeremy Johnson an award. Torgensen had previously learned from federal agents that they were taking a hard look at Johnson for possibly committing crimes in connection with his business. And Torgensen had passed a warning on to Shurtleff about Jeremy Johnson. “In typical fashion,” Torgensen recounted, Shurtleff said “thanks” but then promptly continued to interact with Johnson.307 In light of Shurtleff’s failure, Torgensen thought it appropriate to warn John Swallow about Johnson. So after a Monday meeting, Torgensen asked to meet with Swallow privately. In a closed-door meeting between the two, Torgensen told Swallow about his concerns regarding Jeremy Johnson. Torgensen told Swallow that he should stay away from Johnson. Torgensen also warned Swallow about Lawson. Swallow agreed that Lawson was “creepy,” but said he thought differently about Johnson. It was against this backdrop that Torgensen wrote his “house of cards” email. Torgensen had a bad feeling about Lawson, particularly about his bragging of his connections with the Attorney General. Torgensen also wondered if there was a financial connection between Jenson and Lawson. This was one of the (many) subjects that we wanted to discuss with John Swallow. But he declined to meet with us on advice of defense counsel.308 After Torgensen’s conversation with Swallow about his misgivings regarding Tim Lawson, he received a call from Lawson and learned that Swallow had given Lawson his cell phone number.309 Torgensen was flabbergasted that Lawson would call him directly and sent an email to Reed stating: “[g]uess who called me wanting to take me to lunch? Tim Lawson. Swallow gave him my cell #. Will not call him back. Good grief.”310 Reed was frustrated to
Email from John Swallow to Kirk Torgensen (March 2, 2010, 8:10 am), App. 722. Email from Kirk Torgensen to John Swallow (March 2, 2010, 8:15 am), App. 722. 305 Email from John Swallow to Kirk Torgensen (March 2, 2010, 8:45 am), App. 722. 306 Email from Kirk Torgensen to John Swallow (March 2, 2010, 8:51 am), App. 722. 307 Kirk Torgensen Interview. 308 Id. 309 See Email from Kirk Torgensen to Scott Reed (May 28, 2011, 11:40 am), App. 725. 310 Id.
learn this and replied “John gave him your cell? After all we’ve told him? Huh? How does it feel to be the smartest kid in Exec? Geesh!”311 Swallow later denied providing Torgensen’s cell phone number to Lawson. T. Litigation Regarding Jenson’s Failure to Pay Restitution And Jenson’s Efforts to Raise Coercion Arguments.
In February 2010, Reed met with Ebeling and Bodell and, as noted above, on February 19, 2010, filed a motion for an order to show cause in an attempt to enforce Bodell and Ebeling’s side deals with Jenson that allegedly required monthly payments. Judge Reese issued an order granting a hearing on the motion. The hearing was eventually held on August 11, 2010.312 Shurtleff seemed to gain a sudden interest in the Jenson case during this timeframe, as discussed above. Jenson opposed the OAG’s February 19, 2010 motion, and on June 2, 2010, the court held an evidentiary hearing. At that hearing, Ebeling, Bodell, and Mark James testified regarding the side deals that allegedly required periodic partial payments. 313 Ebeling testified that they had an oral agreement for restitution payments, but James testified that only discussions occurred and no deal was ever reached. After hearing testimony at the June 2, 2010 hearing, the court ordered additional briefing and continued the evidentiary hearing to August 11, 2010.314 At the continued hearing, the court ordered that no action be taken because the plea in abeyance period would not expire until May 28, 2011 meaning Jenson still had over nine months in which to make restitution. The court scheduled the case for a review hearing on January 10, 2011. Reed later identified this failure to set a clear time requirement for the payment of restitution as an example of the one-sided nature of the original agreement. There was simply no way to make Jenson do anything under the agreement until the end of the three-year period. According to Reed, restitution obligations ordinarily require periodic payments to the best of defendant’s financial ability.315 As discussed above in subpart Q, there is evidence that Jenson had access to significant amounts of money during his abeyance period and therefore likely had the ability to make at least partial periodic restitution payments. U. The Jenson Restitution Litigation Continues.
The Jenson restitution review hearing occurred on January 10, 2011. 316 The court ordered restitution to be paid in full by May 28, 2011, and set a review hearing for May 23, 2011.317 That review hearing was later continued to May 27, 2011, and then again to June 2, 2011. On May 9, 2011, and in anticipation of the June 2, 2011, review hearing, the OAG filed a
Email from Scott Reed to Kirk Torgensen (May 28, 2011, 12:11 pm), App. 724. At the hearing, Judge Reese ruled that Jenson had three years to make his restitution and set a review hearing for January 10, 2011. 313 See Jenson I docket entry dated June 2, 2010 (noting that Ebeling, Bodell, and James testified on behalf of the State). 314 Id. 315 Scott Reed Interview. 316 See Jan. 10, 2011 docket entry, Jenson I. 317 Id.
Motion to Reinstate Bail and Other Conditions in the Jenson case. The OAG requested that the court reinstate the prior bail order and require Jenson to report to pre-trial services. The OAG argued that the conditions were necessary because the “defendant has failed for three years to make any effort to satisfy the restitution obligation in this case.”318 Reed also indicated that they had seen more than $9 million dollars pass through Jenson’s checking accounts.319 On June 2, 2011, the court held an evidentiary hearing. Prior to the hearing, Jenson disclosed to his then-attorney Rebecca Hyde that he had not paid restitution because Shurtleff and Swallow had been pressing him to make payments to Lawson. 320 The timing of this conversation is unclear, although it appears to have been shortly before the June 2, 2011, hearing. This conversation was the first time that Jenson had disclosed to Hyde that he had a separate financial arrangement with Shurtleff and Swallow via Lawson.321 Jenson asked Hyde to present that information to the court as an explanation for his lack of restitution payments.322 Lacking corroboration of Jenson’s claims, and believing that the arguments would anger the Judge to the detriment of Jenson, Hyde refused to present the argument.323 V. The Mt. Holly Investigation and Filing of Charges.
While all of the events surrounding the original Jenson case (sometimes referred to as “Jenson I”) were moving forward, an investigation into Jenson’s activities regarding the Mt. Holly Club was also proceeding. Here it becomes necessary to refer back in time to understand the events. In this section, we have summarized the information we have been able to collect relating to the origination and investigation of the Mt. Holly charges. As briefly discussed above, Mt. Holly was a project developed by Jenson and his brother Steven. Mt. Holly was promoted to be an exclusive resort development set in the Tushar Mountains of Southern Utah near Beaver, Utah.324 Jenson marketed it as a private ski and golf resort offering memberships to those who bought in for around $1.5 million.325 Possible fraud by Jenson in connection with the Mt. Holly development had been called to the attention of the OAG as early as December 2006, when attorney Jim Bradshaw had sent a letter to the OAG raising the issue. The OAG was aware of the possibility of wrongdoing by Jenson at that time. As the plea discussions in Jenson I progressed, the OAG at various points asked for restrictions on Jenson’s business activities (particularly so called “hard money lending”) to avoid the risk of additional frauds. Jenson’s attorneys countered that he needed to make a living and that he would be unable to pay restitution unless he was allowed to run some sort of business.326
See State’s Motion to Reinstate Bail and Other Conditions at 3, Jenson I (filed May 9, 2011), App 726. Scott Reed Interview. 320 Rebecca Hyde Interview. 321 Id. 322 Id. 323 Id. 324 See Steven Sperry, Report Regarding June 17, 2010, Interview of Jeffrey and Judee Donner, App. 730. 325 See Steven Sperry, Report Regarding June 22, 2010, Interview of Timothy Bell, App. 733. 326 Scott Reed Interview.
A reflection of these discussions is found in a February 28, 2008, email, when plea negotiations were very active in Jenson I. An email from Reed to Skordas discussed what business activities Jenson would be allowed to pursue, and an intent to “carve Mt. Holly out” from any other restrictions.327 Particularly interesting in light of later events is a March 3, 2008, email from Reed to Skordas: “We’ll give you Mt. Holly, so we know what to keep an eye on during the PIA period, otherwise, no can do on the rest of it. . . .”328 There appears to have been a widely-shared sense in the OAG that whenever someone was involved in a particular fraud, the odds of them committing subsequent frauds were very high. If the OAG could keep an eye on a fraudster long enough, they would eventually be able to catch him and prosecute him. 329 Reed told us that he was not really aware of any allegation of criminal activity when the Mt. Holly provision was being discussed. It should be noted that Reed joined the OAG in March 2007, which was two months after the Jim Bradshaw letter had been discussed by the screening committee. Ultimately the plea agreement that Jenson entered in May 2008 did allow him to pursue activities at Mt. Holly. During the hearing on the plea in abeyance, the Mt. Holly Project exemption was discussed with the judge. Reed explained that the Mt. Holly project exception “has been the subject of much discussion over the course of several months.”330 The general justification was that Jenson had to some way provide for his family and the victims. After Jenson entered his plea in Jenson I, it appears that he may have actually used the no-contest plea (and the Mt. Holly provision in particular) as a way of getting people to invest in the Mt. Holly development project. For example, on July 28, 2008, Marc Jenson sent an email to Jeff Donner bragging about his plea deal, stating: “They dismissed every charge they filed against me, I agreed to pay some money only after they gave me a deal that required no money and the judge wouldn’t sign it.”331 Jenson went on to encourage Donner to finalize his transaction with Mt. Holly and buy in completely. On March 24, 2009, Tim Lawson sent an email to Tim Bell that was forwarded to Jeff Donner. Lawson stated that the OAG would verify the legitimacy of Mt. Holly and Lawson himself. Lawson provided Shurtleff’s OAG email address.332 The next day, Lawson sent an email to Donner again proposing that he not use the court system. Lawson wrote, “I have no doubt that AG Shurtleff will tell you that I am honest, forthright, direct and a general pain in the butt. However, I’m a great friend to have in the foxhole when all heck breaks loose.”333 Then, during May 2009, Marc Jenson and his advocates attempted to get the OAG to delay XE Capital’s foreclosure on the Mt. Holly project. These events have been discussed above.
Email from Greg Skordas to Scott Reed (March 3, 2008, 1:59 pm), App. 735. Email from Scott Reed to Greg Skordas et al (March 3, 2008, 9:00 am), App. 735. 329 Scott Reed Interview. 330 Audio of May 29, 2008 hearing, Jenson I, at approximately 7:37 minutes. 331 See Email from Marc Jenson to Jeff Donner et al. (July 28, 2008, 11:11 am), App. 737. 332 See Email from Tim Lawson to Tim Bell (March 24, 2009, 5:20 pm), App 561. 333 Search Warrant Affidavit #14190003, pg. 17 ¶ 45.
On November 19, 2009, Daniel Wadley, an attorney at the law firm of Holland & Hart, emailed Reed a copy of a draft complaint on behalf of Dr. Donner against Jenson and others involved with Mt. Holly.334 On November 20, 2009, Shurtleff emailed Tim Bell and said he had forwarded complaints to the OAG’s criminal and investigation divisions and asked them to take another look at Jenson’s activities with respect to Mt. Holly.335 On March 26, 2010, Shurtleff forwarded an email from Tim Bell, requesting an investigation of Jenson regarding Mt. Holly. He copied Bell and Swallow. Shurtleff asked the OAG attorneys to meet with the Bells and their attorney.336 Shurtleff also forwarded a March 26, 2010, email from Jennifer Bell. Her email said that her husband has been trying to set up appointment with Shurtleff to meet with Donner. Shurtleff forwarded the email to Reed, Torgensen, Wallentine, and Swallow and said “I have been forwarding you these emails for some time.” Shurtleff also said that it was important for “us” to meet with “these folks if at all possible prior to Jensen’s OSC hearing.” Shurtleff also said he “spoke to Mrs. Bell this morning and committed to set up a meeting.”337 Against this backdrop, the formal origination of the Mt. Holly investigation appears to have been triggered by a meeting on May 5, 2010. At that meeting, Jeff and Judee Donner and their attorney, Carl Barton, Tim Bell and his attorney, Bret Orozco, and Tracy Fox, all met with Shurtleff, Torgensen, Reed, and Special Agent Kerry Gallegos. At the meeting, the Donners, Bell, and Fox all provided information about how, in their view, they had been defrauded out of more than $2 million by Marc and Stephen Jenson in connection with the Mt. Holly Project.338 At that point, the Investigative Division made a decision to investigate Mt. Holly. Ken Wallentine, Chief of the Investigative Division, told us the investigation originated through standard procedures. According to Wallentine, the case came in “according to the book.” 339 The case was referred to him by Reed, “which is how it should have come in.” At that point, Wallentine made the normal case assignment. Investigator Steve Sperry was next up in the rotation to take a case like this, and it was an appropriate assignment for him because he was also an accountant. 340 Investigator Kerry Gallegos also worked on the case. As the investigation began, several unusual events occurred. First, on May 13, 2010, Gallegos emailed Reed telling him that Jenson had called Gallegos that morning and stated that he heard Gallegos had been asking around about him and was scaring a lot of people. Gallegos suggested that future Jenson communication should go through Jenson’s counsel. Reed forwarded this email to Torgensen who, in response, asked Reed if he was sure he wanted to be a judge. Reed responded: “No – really I’d much rather sit around and have the Attorney General f*** up my cases. I’m going to have Kerry tell Mr. Jenson that any communication he has with
See Email from Daniel Wadley to Mark Shurtleff (Nov. 19, 2009, 4:10:28 pm), App. 648. See Email from Mark Shurtleff to Tim Bell (Nov. 20, 2009, 9:09 am), App. 646. 336 See Email from Mark Shurtleff to Shelley Exeter et al. (March 26, 2010, 9:32 am), App. 719. 337 Id. 338 Sperry Affidavit in Support of Statement of Good Cause. 339 Ken Wallentine Interview. 340 Ken Wallentine Interview.
this office should be in writing through his attorney. Who do you suppose his next call will be to?”341 Reed told us in his interview that he did not want Shurtleff to foul up this case (i.e., the Mt. Holly investigation) the way he had the last one (i.e., Jenson I). Slightly later that same day, Wallentine (Gallegos’s supervisor) emailed Torgensen: You’ll never guess who called Kerry this morning. Mark [sic] Jenson. He’d heard that people had been saying bad things to Kerry and wanted to know “what he could do for him.” Kerry told him that he couldn’t talk right then. Instruction from Scott: Don’t talk, tell Jenson that he is a represented party and that all communications, including communications to the Attorney General, must go through counsel.342 Torgensen responded: “Not surprising is it?”343 Wallentine replied: “Now we are sure that there was a spy.”344 Wallentine later recounted to us that he and Torgensen were trying to figure out how Jenson had learned so quickly about the actions of an OAG investigator. They thought that the “spy” was Shurtleff – i.e., that Shurtleff was communicating directly with Jenson or his representatives about the OAG’s ongoing criminal investigation. This was consistent with their earlier observations in connection with the Jenson I plea process that Jenson seemed to be in direct communication with Shurtleff.345 The OAG investigators continued to find evidence of fraud by Jenson relating to the Mt. Holly Project. On September 14, 2010, Reed filed a Statement of Good Cause along with a supporting affidavit by Steve Sperry. Reed’s Statement of Good Cause is largely non substantive, stating simply that “I believe good cause exists for this court to approve an investigation . . . .” The substance of the filing is Sperry’s affidavit, which sets forth the substance of evidence regarding the defrauding of Donner ($1.5M), Fox ($260K) and Bell ($500K).346 As the investigation proceeded, a new prosecutor arrived in the OAG – Che Arguello. In April 2011, he was assigned the Mt. Holly case.347 Arguello was a relatively new addition to the OAG, but had significant prior prosecutorial experience in the Manhattan District Attorney’s office. Arguello had begun working for the OAG as a replacement for Charlene Barlow on December 6, 2010.348 Arguello, as the lead prosecutor, made the charging decisions on the Mt. Holly case. He told us that he put together the charges that he deemed appropriate without political pressure from anyone.349 We talked to all three of the prosecutors who were in the
See Email from Scott Reed to Kirk Torgensen (May 13, 2010, 12:31 pm), App. 763. See Email from Ken Wallentine to Kirk Torgensen (May 13, 2010, 1:11 pm), App. 764. 343 See Email from Kirk Torgensen to Ken Wallentine (May 13, 2010, 1:16 pm), App. 764. 344 See Email from Ken Wallentine to Kirk Torgensen (May 13, 2010, 1:17 pm), App. 764. 345 Ken Wallentine Interview. 346 See Statement of Good Cause, Jenson II (filed on Sept. 14, 2010); Sperry Affidavit, Jenson II (filed on Sept. 14, 2010). 347 Che Arguello Interview. 348 Id. 349 Id.
chain of command on the Mt. Holly case – Arguello, Reed, and Torgensen. All three had the very clear impression that Marc Jenson had deliberately perpetrated a fraud involving millions of dollars. For example, while Torgensen was not involved in the details of the Mt. Holly investigation, it was his belief that Jenson’s financial transactions were a “complete fraud.” Torgensen had the impression that heavy machinery would be brought in just to show prospective victims that major work was being done at Mt. Holly, when in fact no such work was being done.350 As to the scope of the charge, the OAG had received information that Tim Bell might be criminally involved in fraudulent activity at Mt. Holly. Arguello vetted the issue, doing all of the work on Tim Bell. He ultimately decided that Tim Bell was better viewed as a cooperating witness rather than as someone who should be prosecuted.351 Torgensen recalled that there was no pressure from Shurtleff (or Swallow) regarding that decision.352 As for the timing of filing the charges, Reed later recounted that they were ready to file around June 2011. But Reed wanted to wait to file the charges until after the last restitution hearing on Jenson I was completed. Reed did not want the new charges to be an excuse for Jenson not to pay restitution to the earlier victims.353 Accordingly, Steve Sperry obtained an arrest warrant for Jenson shortly before the August 23, 2011, hearing. Sperry had the warrant with him at the hearing in case Jenson was not put in jail at the conclusion of the hearing. 354 The filing of charges were delayed so that, “hope against hope, Jenson might actually pay some restitution” to Bodell and Ebeling.355 If Jenson was not detained for failure to pay restitution, Sperry would have arrested him on the way out of the courtroom. W. Jenson’s Bail Is Revoked.
On August 23, 2011, Judge Reese held a hearing on whether Jenson had violated his plea in abeyance by not paying restitution. While that issue was being argued before the court, something quite unusual happened, as both Reed and Torgensen later told us. Seated in the jury box during the hearing was an Adult Probation and Parole (AP&P) officer, Troy Slater. He was not identified as an AP&P officer during the hearing. He was there taking notes about potential restitution issues, as AP&P would likely be involved in any collection effort. As the hearing unfolded and Reed was making the case to detain Jenson, Reed received a text message from Shurtleff to the effect of: “Why is AP&P in the hearing?” Reed called or texted Torgensen and said something to the effect of “What in the hell is Shurtleff doing?”356 Torgensen then contacted Shurtleff. Torgensen cannot recall whether their exchange was via
Kirk Torgensen Interview. Che Arguello Interview. 352 Kirk Torgensen Interview. 353 Scott Reed Interview. 354 Steve Sperry Interview. 355 Scott Reed Interview. 356 Id.
text or email, but he remembers asking Shurtleff how he knew that an AP&P officer was there. Shurtleff responded “Jenson texted me.”357 Torgensen then angrily responded, “Why are you taking texts from Marc Jenson. This led to a “testy” exchange between Shurtleff and Torgensen, with Torgensen explaining to the Attorney General that it was the responsibility of AP&P officers to try and collect restitution from defendants who were not paying.358 Torgensen said that Shurtleff should not be taking such text messages. Shurtleff claimed that he did not know how to stop Jenson from texting him, and Torgensen replied that he did not need to respond to Jenson and described for Shurtleff blocking features on cellphones that prevented such contact. Torgensen also explained to Shurtleff that it was a normal court procedure for AP&P agents to attend hearings involving restitution and possible incarceration. Later, both Torgensen and Reed were amazed that Jenson seemingly had the ability to communicate with Shurtleff about the court proceeding “in real time.” Ultimately, after hearing from Reed and Jenson’s attorney, Rebecca Hyde, Judge Reese found that Jenson had violated his plea in abeyance by not paying restitution.359 The judge also found that Jenson could not tender encumbered real property as a way to pay restitution – a point of contention during the hearing.360 Reed then asked that Jenson be detained, and argued for a $4.1 million cash bail, stating that Jenson was a flight risk who was a constant danger to the “economic well-being of the community.”361 Judge Reese chose to set bail at $500,000 and required Jenson to surrender his passport.362 Because Jenson did not have $500,000, he was taken into custody. Shortly after Jenson was taken to the Salt Lake County jail, Investigator Sperry served the Mt. Holly warrant on him.363 At some point after Jenson was sent to prison, he again raised the issue of his financial connections to Shurtleff with Rebecca Hyde. 364 As in the earlier conversation, he told Hyde that Shurtleff and Swallow had visited him in California and had pressed him for payments.365 As on the earlier occasion, Hyde refused to present Jenson’s claims to the court because she had no corroborating evidence.366 After Jenson was transferred to the Beaver County Jail, Arguello instructed OAG investigator Steve Sperry to begin monitoring Jenson’s jailhouse calls (other than attorney calls).367 So Sperry began to obtain recordings of Jenson’s calls. 368 Jenson made a large number
Kirk Torgensen Interview. Id. 359 See Audio of August 23, 2011 Probation Revocation Hearing at approximately 34:40 minutes. 360 Id. 361 Id. at approximately 44:36 minutes. 362 Id. at approximately 48:50 minutes. 363 Steve Sperry Interview. 364 Rebecca Hyde Interview. 365 Id. 366 Id. 367 Che Arguello Interview. 368 Steve Sperry Interview. Because of the large number of calls recorded and the expense associated with listening to all of the calls, we asked our investigative team to listen to a few calls to confirm their general tenor. Our review of the calls was generally consistent with the descriptions provided by Sperry and Arguello.
of calls, as many as 20 to 30 in a single day. Sperry heard Jenson express disappointment with how his defense attorneys had handled the detention issue.369 Sperry also heard Jenson talking about a plan to deceive Judge Reese by feigning cancer as a sympathy ploy. 370 But most significantly, Sperry heard Jenson making a number of statements about Shurtleff and his heir apparent, John Swallow. For example, on September 16, 2011, Jenson spoke to Peter [Torres] at 10:20 a.m. and stated that the AG’s Office had “…better let me go Peter or I’m going to bring that whole office down.”371 Sperry heard Jenson tell Torres that he should find the receipts from the Shurtleff and Swallow visits to Pelican Hill and take them to the media. Jenson said the receipts would help confirm that Shurtleff and Swallow had visited Jenson in California to obtain money from him.372 Jenson said, with regard to Swallow running for Attorney General, “I’ll show him. I’ll ruin them all.”373 In the calls, he made statements to the effect that “Shurtleff owes me. I did him a favor. I got him out of trouble from the investigation by [U.S. Attorney] Brett Tolman.”374 Investigator Sperry was quite surprised to hear a jailed inmate talking about an apparently strong personal relationship with the Utah Attorney General, someone aspiring to be the next Attorney General, and the previous U.S. Attorney for Utah. So Sperry took the recordings to Reed, Torgensen, and Wallentine. They were all shocked to hear the recordings. Their reaction was something along the lines of “how stupid were Shurtleff and Swallow to be behaving in this way.” But the sense of the meeting was “Well, if it comes out, it comes out.” The prosecution team continued preparing for the upcoming preliminary hearing on the Mt. Holly case.375 At some point, Arguello learned about a box of documents relating to Jenson that Barlow had assembled before her departure. The documents were kept under the desk of Scheree Wilcox, a paralegal who had worked with Barlow on the case. With Barlow’s permission, Arguello reviewed the contents, which included the December 19, 2006, James Bradshaw letter that alleged Jenson was engaged in fraud with respect to the Mt. Holly development. Arguello, who was still relatively new to the office, was not aware of the Bradshaw letter until discovering it in Barlow’s box. After reviewing the Bradshaw letter and the rest of the contents of the box, Arguello became concerned about potential Brady/Giglio issues.376 Arguello knew that the plea in abeyance agreement allowed Jenson to continue his dealings on Mt. Holly and he wondered how he would establish mens rea since the OAG said his conduct was permitted when it had evidence that it may be fraudulent.377
Che Arguello Interview. Id. 371 Audio of September 16, 2011, Beaver County Jail recorded telephone call between inmate Marc Jenson and Peter Torres at approximately 1:41 minutes (beginning at approximately 10:20 a.m.). 372 Steve Sperry Interview. 373 Id. (recounting recollection of recorded calls). 374 Che Arguello Interview (recounting recollection of recorded calls). 375 Steve Sperry Interview. 376 Letter from James Bradshaw to Charlene Barlow (Dec. 19, 2006), App. 423. 377 Che Arguello Interview.
The OAG Imposes Conflict Screen Related To Jenson Matters.
In May or June 2011, the attorneys working on the Mt. Holly matter concluded that it would not be possible to continue working on the case if Shurtleff continued to have involvement in it. Arguello, Reed, and Torgensen agreed that Shurtleff had to be screened off the case. All three prosecutors thought that the Mt. Holly case was a strong one, and that Jenson had committed a serious fraud resulting in substantial losses to innocent victims. Torgensen, for example, was in direct contact with Dr. Donner, who had lost $1.5 million in Mt. Holly. Torgensen later recounted that Donner expressed concern that, because of Shurtleff’s connections to Jenson (which were a matter of comments in the newspapers and other media), the case would be swept under the rug. Torgensen promised Donner that they would see the case through to a proper conclusion. Indeed, Torgensen ultimately gave Donner his personal cell phone number so that Donner could call and confirm that the OAG was working on the case. Giving his cell phone number to a crime victim was unusual and a sign of Torgensen’s personal commitment to seeing the case through.378 Torgensen felt that the OAG owed it to Donner to make sure the prosecution was handled properly.379 Because Torgensen was the most senior person working on the case – and because he was the one who most frequently interacted with Shurtleff on problems such as this – Torgensen contacted Shurtleff about creating a “conflict screen,” pursuant to which Shurtleff would be excluded or “screened” from any involvement in the decisions about the case. In his interview, Torgensen explained that when he made a telephone call to Shurtleff, Shurtleff became angry in response to the suggestion. Shurtleff questioned the idea of a screen, saying that he had never abdicated his responsibility to be a fair-minded Attorney General who made decisions without regard to his personal interest. Torgensen pushed back, saying to Shurtleff something to the effect of, “What, you don’t see the conflict – Pelican Hill, going to church with Marc Jenson, going out to dinner with him. This is a ‘no brainer.’” Shurtleff said he needed to think about it, but soon agreed that he needed to be screened off the case. The question of John Swallow’s involvement with Jenson also was discussed within the OAG. Torgensen recounted that John Swallow came forward, said that he had done some minimal legal work for Jenson, and he therefore agreed that he should be screened off. Swallow did not disclose that he had been to Pelican Hill to see Jenson. On June 7, 2011, Arguello sent his first draft of a proposed Jenson Conflict Screen to Reed, Barlow, Torgensen, and Nolan.380 In his draft Arguello states that “[t]his screen is established in light of certain perceived or actual personal relationships which may exist between Attorney General Mark Shurtleff, Chief Deputy John Swallow, Mark [sic] S. Jenson, his associates and legal counsel, and various witnesses or potential witnesses.”381 A second draft of the conflict screen was circulated by Arguello the next day. 382 This second draft precluded Communications Director Paul Murphy from knowing about Jenson
Kirk Torgensen Interview. Id. 380 See Email from Che Arguello to Scott Reed et al. (June 7, 2011, 3:54 pm), App. 765. 381 See Memorandum from Che Arguello to Mark Shurtleff et al. (June 7, 2011), App. 767. 382 See Memorandum from Mark Shurtleff to Kirk Torgensen et al. (June 8, 2011), App. 770.
matters and delegated communication responsibilities to Torgensen.383 Arguello was concerned about the close relationship between Murphy and Shurtleff, and the potential that sensitive information could easily be shared between Murphy and those on the other side of the screen. That same day, Swallow emailed Torgensen and Shurtleff about the proposed screen. Swallow stated that he thought the screen was a good idea for him due to his prior dealings with Jenson and their personal relationship.384 As the process of drafting a conflict screen proceeded, Arguello reiterated to Torgensen on June 14, 2011, that he thought Shurtleff needed to be screened from all Jenson matters, and not just the Mt. Holly case.385 Three days later, on July 17, 2011, Reed reasserted his concern. Having further reviewed the Memo with Mark’s edits, I still believe we cannot be effective in protecting the integrity of the new case and insulating the AG from personal or political attack without a full screen starting now, before Jenson’s OSC and sentencing hearings. No doubt Jenson will try to use Mark to influence the sentencing on the current, and exploit that to whatever benefit he can in the current investigation. He may also to use [sic] the AG to create an internal conflict of interest on the new case, requiring disqualification of the entire office. He is much less likely to be successful on that front with a full screen in place. I don’t see how we can go forward and protect the AG at the same time without a full screen, effective before Jenson begins to try to manipulate his sentencing.386 Torgensen agreed with Reed that the screen should cover all existing matters.387 Arguello also supported Reed’s proposal. 388 Shurtleff emailed the group stating: “It’s about 5 years too late to screen me off from the current State v. Jenson case.”389 Shurtleff later conceded that the screen was a good idea.390 Reed and Arguello were insistent that Paul Murphy be screened off the case along with Shurtleff. Reed was concerned that Murphy was just a “yes man” for Shurtleff and that he would tell Shurtleff what was happening in the case. Shurtleff overruled their objections. The final version of the Jenson Conflict Screen was circulated on June 20, 2011, by Mark Shurtleff.391 This final version precluded Shurtleff, Swallow, Shelly Exeter (Shurtleff’s Executive Assistant), and all Civil Divisions from involvement in any Jenson matter.392 However, it did allow Communications Director Murphy to have involvement in Jenson cases. 393 Shurtleff also asked
Id. See Email from John Swallow to Kirk Torgensen et al. (June 8, 2011, 7:14 pm), App. 773. 385 See Email from Che Arguello to Kirk Torgensen et al. (June 14, 2011, 9:07 pm), App. 775. 386 See Email from Scott Reed to Mark Shurtleff et al. (June 17, 2011, 7:39 am), App. 776. 387 See Email from Kirk Torgensen to Scott Reed et al. (June 17, 2011, 9:32 am), App. 777. 388 See Text from Kirk Torgensen to Mark Shurtleff (Nov. 3, 2011, 4:06 pm), App. 779. 389 See Email from Mark Shurtleff to Che Arguello et al. (June 17, 2011, 10:37 am), App. 778. 390 See Email from Mark Shurtleff to Kirk Torgensen (Nov. 4, 2011, 9:31 am), App. 779. 391 See Email from Mark Shurtleff to John Swallow et al. (June 20, 2011, 2:03 pm), App. 780. 392 Memorandum from Mark Shurtleff to Kirk Torgensen et al. (June 20, 2011), App. 781. 393 Id.
to be notified before significant events became public so that he could be prepared to answer media inquiries.394 Shurtleff’s involvement with Jenson, and to a lesser extent Swallow’s, created considerable concern among attorneys in the Criminal Division. This is reflected, for example, in an email sent by Arguello to Reed, Torgensen, and Nolan: “I just hope you know I’m putting you all down as references when I begin my job hunt!!!” Torgensen responded to Arguello saying, “Get in line brother.” This interchange reflected the fact that the attorneys thought they were being forced, as Torgensen later put it, to “walk a complex ethical tightrope.” They wanted to convict Jenson for his fraudulent activities and not let him get the benefit of trying to bribe people. But at the same time, they knew that their ultimate boss – the Attorney General for the State of Utah – had been having private conversations with Jenson and seemed to be on friendly terms with him. Arguello later recounted in his interview that he felt particularly vulnerable to possible retaliation because he was in the first year of his employment with the OAG and he was an atwill employee rather than a “merit” employee. He was also an outsider to Utah, having only recently arrived from New York. His lack of job security in the Office was a source of considerable distress for Arguello.395 Y. Jenson’s Sentencing Hearing and Shurtleff’s Reaction
On November 3, 2011, the court held a sentencing hearing. At the conclusion of the hearing, the court sentenced Jenson to two consecutive 0-5 years, and one concurrent 0-5 years with full restitution to be paid.396 That day, Torgensen reported to Shurtleff on the sentencing.397 Shurtleff responded: Good! Congrats! Despite what some in our office may think, I believe Kensen [sic] is a dirty crook. In addition to all the people he lied to and ripped off, he lied to me and got a lot of people to lie to me for him AND tried bribing me! I started meeting with his victims and asking our guys to investigate him many years ago. Justice has been served. Stay tuned for further rounds.398 Torgensen later recounted in his interview that he viewed this email at the time as a “CYA” effort from Shurtleff – i.e., an attempt to leave a paper trail that would demonstrate that he was in favor of tough punishment for Jenson when, in fact, Shurtleff had been single-handedly responsible for the earlier plea in abeyance and concessions made to Jenson during the plea process.399
Id. Che Arguello Interview. 396 See Jenson I docket entry dated Nov. 3, 2011. 397 See Email from Kirk Torgensen to Mark Shurtleff (Nov. 3, 2011, 2:46 pm), App. 779. 398 See Email from Mark Shurtleff to Kirk Torgensen (Nov. 3, 2011, 4:06 pm), App. 779. 399 Kirk Torgensen Interview.
Torgensen responded to Shurtleff’s email the next morning with a warning about claims Jenson was making: You need to know that jenson (sic) is claiming that he paid for your stay paid by Lawson at the suite in California. He is also claiming to have paid for several trips by John swallow (sic) and his wife. Not sure where this is going to go but thought you should know.400 Shurtleff responded as follows: Surprise, surprise. Of course we knew Jenson would claim that about me. Lawson says he paid for it. The point is, even if he did, it’s irrelevant to his prosecution and sentencing. During any conversation I had with him I consistently reminded and urged him to pay his restitution early and fully. I know John went down on his own and Jenson may have paid for that, but John was a private attorney at the time. Anything he says and does at this point might be an embarrassment to me but it has no legal significance since we continued to investigate and prosecute and sentence him. It was wise to erect the screen.”401 Z. Kirk Torgensen Directs That Certain “Trash” Emails Be Deleted.
During our investigation, we learned of an irregular deletion of emails directed by Torgensen. Whether this deletion was related to the Jenson case (or another case) or was instead attributable to a personal matter is unclear. We set forth the facts as best we can determine them from our very limited investigation. It appears that on December 31, 2011,402 Torgensen asked his executive assistant, Leslie Mascaro, to go into his office and delete emails from his “trash” file. Mascaro told us that Torgensen arrived at her house very emotional and upset. Torgensen told Mascaro about marital problems he and his wife were having, including a recent fight after his wife had reviewed some of his office emails. Torgensen’s wife had somehow determined the password to his OAG email account (perhaps because he had not used a sufficiently unique password) and examined some of his old emails. There she allegedly discovered what Torgensen described as inappropriately flirtatious emails that he had sent to another woman. Torgensen’s wife had printed out these emails and they were causing considerable stress on his marriage.403 The events caused Torgensen to “freak out.” His subsequent actions, he told us, were not well thought out.404 Torgensen wanted to delete these inappropriate personal emails from his trash file. By his own account (and confirmed by many people in the OAG405) he was not particularly savvy about how his computer operated. Torgensen told us he went personally to the
See Email from Kirk Torgensen to Mark Shurtleff (Nov. 4, 2011, 9:20 am), App. 779. See Email from Mark Shurtleff to Kirk Torgensen (Nov. 4, 2011, 9:31 am), App. 779. 402 Torgensen and Mascaro told us different dates as discussed below. 403 Kirk Torgensen Interview. We have obtained independent confirmation that Torgensen’s marriage was under stress at this time. 404 Kirk Torgensen Interview. 405 See, e.g., Ken Wallentine Interview; Leslie Mascaro Interview.
home of his executive assistant, Leslie Mascaro, on New Years’ Eve. He asked her if she would do him a favor and go quickly to his office and delete all of his old, previously-read emails. Mascaro was not feeling well, but reluctantly agreed to go.406 On New Year’s Day, Mascaro went to College Drive. She then deleted all of the emails from Torgensen’s email “trash” file. Torgensen was known as a “clean desk” person – his desk was always free of paper. According to Mascaro, Torgensen maintained his email account the same way. After he read an email and responded, he would either (if it was important) move it to the “cabinet” (i.e., a file on the email program) or to “trash.” Mascaro deleted only the emails in Torgensen’s trash file. It took her about 1 1/2 to 2 hours to do so, as she had to manually do a “drag and drop” procedure for the deletions.407 Both Torgensen and Mascaro did not think that they were destroying the only copy of these emails. Instead, it was their understanding that a State database in Richfield, Utah, was making a backup copy of all emails in the OAG. This understanding was widely shared at that time in the OAG. There was a general sense in the OAG that some kind of “Big Brother” repository existed for all emails.408 And, indeed, at that time a large database in Richfield, Utah, did backup many emails from many state agencies – such as all emails on computers for the Department of Public Safety. However, because of funding limitations, the OAG was not on that system, at least as of 2010 or 2011.409 Torgensen also told us that he did not think he was violating any OAG record retention policy in directing the deletions.410 From our interviews, it is not entirely clear what the OAG’s email retention policy was at that time, particularly with respect to emails that had previously been identified as appropriate for a “trash” file.411 Because this issue was not central to our task, we have not investigated what laws may apply to deletion of emails. Torgensen also indicated his understanding that cleaning out old emails might speed up the processing speed of his computer. He denied any intent to permanently destroy emails regarding the Jenson case (or any other case). He said he just wanted to prevent his computersavvy spouse from reading them. We believe that we have seen most of the emails that Torgensen sent to others within the OAG relating to the Jenson matter because we received them from other people who retained copies (particularly Reed, who apparently never deleted anything412) or from other backup files in the OAG. During their interviews, both Torgensen and Mascaro indicated that the deletions took place on January 1, 2011. However, a few days after his interview, Torgensen contacted us and told us that he was mistaken and that the deletions had taken place on January 1, 2012.
Leslie Mascaro Interview. Id. 408 Ken Wallentine Interview; Chris Earl Interview. 409 Chris Earl Interview. Our understanding is that all OAG email accounts are now on a system like the one in Richfield that provides a daily backup. 410 Kirk Torgensen Interview. 411 Chris Earl Interview. 412 Leslie Mascaro Interview.
Torgensen told us that he had verified that the date was one year later, although it was not clear to us how he had done so. In an effort to shed light on the date, we asked Chris Earl, OAG’s IT person, to tell us how many emails were in Torgensen’s Groupwise email account. Earl gave us the following totals, which reflect the number of emails in Torgensen’s account and trash folder as of March 31, 2014: Account: 2012 - 23,268 2011 - 4,028 2010 - 1490 2009 - 900 2008 - 784 2007 - 574 2006 - 495 2005 - 163 2004 - 36 Trash: 2012 - 1,555 2011 - 2 2010 - 13 2009 - 148 2008 - 76 2007 - 29 We believe these numbers are inclusive and do not establish when the deletions occurred. Without doing a forensic analysis, we have no way of knowing when the deletions occurred. With our limited time and budget, we have not been able to obtain any more information on the issue. As such, we reach no conclusions regarding the timing of the deletions. AA. Jenson Sends Letter Directly to Shurtleff’s Residence.
Around February 2, 2012, Arguello had a casual conversation with Torgensen during which Torgensen recounted that he had just visited with Shurtleff, who had said something to the effect of “Guess who just sent me a letter? Marc Jenson!”413 In response, Arguello demanded “I want the letter and the envelope.”414 Torgensen in turn asked Shurtleff for the letter. After several follow up efforts to get Shurtleff to produce the letter, Shurtleff stated in an email to Reed and Arguello the he had “asked M’Liss to hunt around but I’m pretty sure I tossed it.” After claiming his wife was unable to locate the letter, Shurtleff made several claims regarding the contents of the missing letter. He (Shurtleff) said “the only thing [Jenson wrote in the letter] that might be a concern” was the following statement: “‘I did you a favor when you
Che Arguello Interview. Id.
needed help and I’m asking for one in return, please come visit me.’” Shurtleff then added, “I’m sure he is suggesting the ‘favor’ was the visit to CA that Tim told me he paid for” and that Jenson “complained about how hard this is on his wife and daughter and protested that he really is a ‘good man.’”415 Arguello had serious concerns about why Shurtleff would have thrown the letter away.416 He wondered what kind of dealings Shurtleff and Jenson had had with each other. Reed had the sense that Shurtleff was reluctant to even discuss the fact that he had received a personal letter from Jenson.417 Torgensen had the impression that Shurtleff did not want his prosecutors to get hold of the letter because there could have been “zingers” in there.418 After Torgensen reported that Shurtleff said the letter from Jenson had been thrown away, Arguello met with Torgensen and said: “We have to get rid of this case [send it to another prosecuting authority].” Arguello told us that Torgensen got angry and refused, saying that Jenson was a very bad character and that the OAG knew him and were the only ones who could get him.419 BB. Internal Debates Regarding the Transfer of Lawson and Jenson Cases.420
On May 1 and again on May 2, 2012, Arguello, Reed, Torgensen, and Craig Barlow met to discuss transferring the Mt. Holly case out of the Attorney General’s Office. The meeting was initiated by Arguello. Torgensen brought Craig Barlow in because of his judgment and experience in dealing with complicated cases. Arguello laid out what he believed to be a very strong case that the Attorney General’s Office had a conflict of interest in handling the Jenson case and should assign it to another prosecuting authority. In particular, the original plea in abeyance agreed to by Marc Jenson had specifically authorized Jenson to work on the Mt. Holly project. That would likely be a central defense by Jenson in the Mt. Holly prosecution, which would require the prosecutor (i.e., Arguello) to cross-examine his bosses about what that provision meant. More generally, Mark Shurtleff’s and John Swallow’s interactions with Jenson would be used to suggest that the Attorney General’s Office had effectively “blessed” the Mt. Holly project. Craig Barlow weighed in to support Arguello. Barlow believed that the approval of Mt. Holly was a serious legal defense. It would be used by defense counsel to show that Jenson lacked “criminal intent” because he was proceeding with a project that had been blessed by the Attorney General’s office. The atmospherics and optics of hanging onto the case would be horrible. All of the communications between Attorney General Shurtleff and others in the office
See Email from Mark Shurtleff to Kirk Torgensen (Feb. 8, 2012, 9:15 am), App. 784. Che Arguello Interview. 417 Scott Reed Interview. 418 Kirk Torgensen Interview. 419 Che Arguello Interview. 420 The information recounted in this subsection comes from interviews with Che Arguello, Scott Reed, Kirk Torgensen, and Craig Barlow. All four have the same general recollection of what happened at the meetings, although these is some slight difference in recollection as to the ultimate outcome of the meeting as discussed in text.
and Marc Jenson would come into evidence. Barlow thought that it was a “no brainer” that the case should immediately handed be off to another prosecuting agency.421 Reed and Torgensen disagreed with Arguello and Barlow’s assessment of the situation. As Reed and Torgensen later recounted, they believed that the OAG did not have a clear cut conflict of interest at that time in the case. The immediately pending issue that the trial court would have to decide was whether to bind Jenson over at the preliminary hearing. Shurtleff’s dealings with Jenson would not be relevant to the court’s bindover determination, which would involve only an assessment of whether there was probable cause to proceed to trial. Reed and Torgensen thought that there was no conflict of interest “right then” and so the proper approach was to see the case through the preliminary hearing and then determine whether to “shop the case” (i.e., find another prosecuting agency to handle it). Reed and Torgensen were both worried that the case had gotten very “messy.” Any prosecuting authority to whom they presented the case would be aware of Shurtleff’s alleged involvement with Jenson. It would be far easier to shop the case, Reed and Torgensen argued, once a judge had established that the charges were supported by probable cause. During the meetings, an investigation into the possible criminal activities of Tim Lawson was also discussed. All of the participants agreed that, given Shurtleff’s close relationship with Lawson, there was a clear conflict of interest and that any decision about charges on Lawson would have to be transferred to another agency.422 The meeting occurred over two days. In the second meeting, the decision to transfer the Lawson matter was agreed upon. But Torgensen and Reed concluded that the Mt. Holly case was “not in the right posture” to be transferred at that time. They also wondered where the case could be transferred to. They decided that instead of transfer, the OAG should take the case through the preliminary hearing.423 Apparently the Beaver County Attorney’s Office was never involved in the prosecution decisions for Mt. Holly, even though the case involved a property development located entirely within Beaver County. The OAG participants regarded the Beaver County Attorney’s Office as simply too small to handle a prosecution of the size and complexity of Mt. Holly. Arguello indicated his discomfort with handling the case in view of the possible conflicts. Arguello asked to be taken off the case and Reed agreed to take it over. Arguello was appreciative of Reed doing this for him (“Scott fell on his sword again”), although he remained suspicious that the reason for Reed wanting to retain the case was to avoid any negative publicity to Shurtleff’s chosen successor, Swallow, that might result from a recusal decision before the election.424 Arguello’s impression was that at the end of the two meetings, there was an agreement to refer the case out after it went through the preliminary hearing. 425 Torgensen and Reed recall
Craig Barlow Interview. Kirk Torgensen Interview. 423 Scott Reed Interview; Kirk Torgensen Interview. 424 Che Arguello Interview. 425 Id.
that there was a sense of inevitability about needing to transfer the case, but did not think there was a formal agreement to do so – only a commitment to see what the case looked like after the preliminary hearing.426 By that time, the preliminary hearing had been already continued twice and was then set for August 8, 2012. According to the docket, Jenson was not transported from the Beaver County jail for the hearing on August 8 and it was continued to September 24. The preliminary hearing began on September 24 and the evidence was completed on October 18 and 22. At the conclusion of the hearing, the court ordered briefing to be completed by December 31, 2012, and Jenson was bound over on February 7, 2013. CC. OAG Personnel Refer Tim Lawson For an Outside Investigation and Do Not Disclose the Referral to Shurtleff.
Around (or perhaps before) the May 2012 meetings on the conflict of interest, attorneys in OAG – specifically Torgensen, Reed, and Wallentine – decided that they needed to have a criminal investigation done of Tim Lawson. Lawson’s activities – and particularly his willingness to invoke the authority of the Attorney General’s Office – had been the subject of discussion for some time. Perhaps most significantly, the Holland and Hart attorneys for Jeff Donner had presented to the OAG a document from Lawson threatening Donner.427 In the document Lawson threatened Donner and made frequent references to his personal connection with Shurtleff in various settings.428 Torgensen, Reed, and Wallentine reached the conclusion sometime in the first half of 2012 that they needed to refer Lawson for a criminal investigation outside the OAG. Torgensen told us that this decision to refer the Lawson matter to an outside investigator as “the hardest decision I ever made.” Referring Lawson for a criminal investigation to an independent agency outside the control of the OAG might well lead to the doorstep of Shurtleff. Torgensen, Wallentine, and Reed agreed not to tell Shurtleff about the referral on the grounds that he had no legitimate reason to know. The decision was to refer Lawson for an investigation by the Department of Public Safety (DPS), an agency that was completely separate from any control by the Attorney General. 429 DPS sent Scott Nesbitt over to inquire, and Torgensen, Reed, and Arguello told him about the Lawson relationship with Shurtleff and gave him the threatening letter from Lawson to Donner.430 Agent Nesbitt asked what he should do when the investigation was complete; should he take it to a county attorney. Torgensen responded, “No, bring it back to us and we’ll decide what to do with it.”431 Arguably, Torgensen should have allowed Nesbitt to take it to a county attorney rather than attempt to maintain control of the case in the OAG.
Scott Reed Interview; Kirk Torgensen Interview. Kirk Torgensen Interview. 428 Letter from Tim Lawson to Jeffrey Donner (Approximately May 2012), App. 785. 429 Kirk Torgensen Interview. 430 Id. 431 Interview of Scott Nesbitt.
Nesbitt took over the investigation. Both Reed and Torgensen indicated that they understood that the investigation took a long time, but that they lacked any control over the pace of this investigation. Wallentine, the head of the Criminal Investigations Division, expressed surprise that the DPS investigation took so long to complete, but he had no idea about what was going on with the investigation. There was a complete screen about how the investigation was proceeding. Once DPS took the case, it was theirs to run with. Wallentine noted that it is common practice for criminal investigators not to disclose the course of investigation until it is completed. 432 Ultimately Nesbitt returned, telling Torgensen that he had enough evidence to file a criminal case against Lawson.433 Nesbitt also told him that Shurtleff was the subject of a criminal investigation. Given this news, the OAG had no choice but to refer the Lawson case to an outside prosecutor. The matter was referred to Davis County Attorney Troy Rawlings. From November 2012 to June 2013, Lawson periodically sent text messages to Swallow.434 On one occasion Swallow did tell Lawson that he was screened from the Jenson case, but Swallow never explicitly told Lawson that he could not speak with him. 435 In the text messages that followed, Swallow often responded, but usually just enough to thank Lawson. In one text exchange between Swallow and Lawson, and in response to Swallow’s comment about the Jenson screen, Lawson stated, "Mark is behind that same screen and he and I still get together."436 DD. The OAG Did Not Transfer the Jenson Case Following John Swallow’s Election.
On November 6, 2012, John Swallow won the general election and, on January 7, 2103, succeeded Mark Shurtleff as Attorney General. A month later, on February 7, 2013, Jenson was bound over on the Mt. Holly charges. Arguello told us that shortly after the bind-over, he confronted Torgensen about what he thought was a commitment to transfer the case. According to Arguello, Torgensen said that recusal was no longer required because Swallow had been elected and thus Shurtleff was now out of the picture.437 Torgensen told us that such a confrontation “did not happen.” Torgensen stated that, since Shurtleff had been screened off from the case, the election of Swallow made no difference. Torgensen also indicated that Swallow never inquired or probed about the progress of the Mt. Holly case.438 Because of limited time to conduct our investigation, we have not been able to fully determine the events surrounding the ultimate transfer of the Mt. Holly case out of OAG. Torgensen told us that he and Reed both felt that they would have to get rid of the case.
Ken Wallentine Interview. Id. 434 During the course of our investigation we were provided with Search Warrant Affidavits that contained text messages between Lawson and Swallow. These text messages only provide limited context and often do not include the message that preceded it or any texts sent in response to the message. 435 Search Warrant Affidavit #14190005 pg. 34-35 ¶ 112-14. 436 Search Warrant Affidavit #14190005 pg. 34-35 ¶ 112-14. 437 Che Arguello Interview. 438 Kirk Torgensen Interview.
Torgensen also conceded in his interview that, in hindsight, given all the allegations that have now been made, Arguello “may well have been right” about the desirability of an immediate transfer of the case. Torgensen pointed out, however, that shopping the case later was quite difficult, as Reed (who handled the transfer) had to go to approximately four or five different prosecuting authorities before finding someone willing to take it. One event that clearly accelerated the process was the filing by Marc Jenson of a petition to recuse or disqualify the OAG. In July 2013, OAG transferred the case to the Utah County Attorney’s Office, which continues to handle the matter. EE. Text Messages Between Shurtleff and Torgensen.
We also reviewed a series of text messages between Shurtleff and Torgensen. The messages run from April 6, 2013, to November 22, 2013, and were apparently taken directly from Torgensen’s iPhone. The text messages begin well after the events in question, raising the issue of why they start at this point and not earlier. Torgensen in his interview explained that he had a regular practice of deleting all text messages after he read them. The text messages typically had no value after he read them, so (in his view) there was generally no reason to retain them. With his discussion with Shurtleff, however, he realized that the interchange might later be significant, so he stopped deleting those messages. According to Torgensen, he later asked an IT person at the OAG to simply download all of the messages.439 Lacking resources to conduct a forensic examination to determine whether there has been any selection or “cherry picking” of messages, we have simply taken the messages at face value. Early on in this exchange, Shurtleff explains that one reason he brought Swallow into the OAG “was to make sure [Swallow] won so he would keep [Torgensen] and Ken [Wallentine] and Paul [Murphy] and most of our Division Chiefs in place.”440 It appears that there was truth in what Shurtleff said, as Swallow did keep Torgensen and others in their same positions after becoming Attorney General. We also note that Torgensen lobbied Swallow for a raise and suggested that the raise be timed in a politically expedient manner.441 On April 30, 2013, Torgensen texted Swallow and proposed that Swallow provide him a “pay bump” while they “were in a quiet period.” Torgensen later texted again and asked that his pay increase occur when there is “no story or other stuff going on.” It is unclear if the requested pay increase occurred, although Torgensen did later receive a $4,000 bonus from Swallow. In the text message exchange with Shurtleff, Torgensen also repeatedly asked Shurtleff about, or commented on, Shurtleff’s involvement with Jenson, and the trips to Pelican Hill. In one exchange Torgensen stated, “It is shocking that you would go to pelican hills and stay in a 1000 a night suite and golf and go to church with someone your own office had prosecuted. You and no one else gave Jenson the ability to allege nasty things about you and John and now your entire crim div. no one did that but you. Sorry but that is the truth.”442 Shurtleff responded, “Of
Kirk Torgensen Interview. Text message from Mark Shurtleff to Kirk Torgensen (April 6, 2013, 11:28 pm), App. 830. 441 Text message from Torgensen to Swallow (April 30, 2013), App. 836. 442 Text message from Kirk Torgensen to Mark Shurtleff (June 29, 2013, 11:11 am), App. 832.
course I do Kirk. I haven’t once blamed you or anyone else. I will defend myself as to the true facts, but at the end of the day Jenson got nothing but jailed and prosecuted with my strong support. By the way, they suggested movie deals, they suggested fundraisers. I said no. Please at least give me credit for that.443 Shurtleff admitted that he had “made a stupid decision but did nothing illegal or unethical.”444 Shurtleff went on to say he “never made one dime or any campaign contributions from Jenson or any of his associates.” 445 Shurtleff also claimed that he “never made any money off my book and Jenson’s claims about that are all lies.” 446 Over the course of the exchange Shurtleff repeatedly apologizes for his actions and the embarrassment he has caused, and at the end, Shurtleff said, “I’m sorry for all I’ve put you through.”447 FF. Current Incarceration and Jenson’s Pending Petition
After his sentencing in November 2011, Jenson continued to serve time in the Utah State Prison system. On January 30, 2012, Scott Reed sent a letter to the Parole Board (as is standard practice) providing information about the case. The letter asked for a sentence longer than the Parole Board matrix would otherwise provide. Reed’s letter stated, in part: The economic mayhem that Defendant has left in his wake over at least the last twelve years is unfathomable. Meanwhile his lifestyle over that time has been exorbitant and excessive. In one nine month period in 2009, in between living in leased multi-million dollar beachfront mansions in Orange County, Defendant incurred over $500,000 in lodging expense at the exclusive Resort at Pelican Hill. During that same period, Defendant spent over $500,000 in American Express charges. Detailed review of Defendant’s bank records reveals that while in California, between February 2009 and September 2010, over $8,990,000 goes into and out of Defendant’s personal checking account alone. And yet he was unwilling to direct a single penny to the $4.1 million in restitution owed to the Utah victims in the case which is current before this board.448 Reed’s letter concluded: “On behalf of the victims in the instant case, and to secure the financial safety of all Utah citizens, the State requests the Board retain Defendant Marc Session Jenson for the full term of his consecutive 0-5 year sentences.”449 After a hearing in June 2012, at which Jenson presented his case, 450 the Parole Board determined that it would hold Jenson until at least August 2016, giving him a review date at that time. The Board has also indicated that it would set an earlier rehearing date if Jenson pays half
Text message from Mark Shurtleff to Kirk Torgensen (June 29, 2013, 11:33 am), App. 832. Text message from Mark Shurtleff to Kirk Torgensen (June 29, 2013, 10:08 am), App. 831. 445 Id. 446 Id. 447 Text Message from Mark Shurtleff to Kirk Torgensen (Nov. 22, 2013, 8:34 am), App. 835. 448 Letter from Scott Reed to Utah Board of Pardons and Parole, Jan. 30, 2013, App. 839-841. 449 Id. 450 Scott Reed sent a letter regarding the case to the Parole Board.
of the restitution that he owes.451 As far as we have been able to determine, Jenson has still not paid any restitution. III. OBSERVATIONS AND CONCLUSIONS CONCERNING THE JENSON CASE.
The Jenson Petition raises a number of serious allegations against the OAG. The basic theme running through them is that Jenson was imprisoned and remains in prison as a result of misconduct by the OAG and, in particular, former Attorney General Shurtleff. Our investigation has led us to the conclusion that this is a case of parallel improprieties. Shurtleff’s conduct, for example, defies explanation. But Jenson’s conduct, too, must be considered. In the final analysis, we do not believe that Jenson has suffered any prejudice from the way his cases were prosecuted. But to increase public confidence about Jenson’s treatment, we recommend that the OAG accede to any appropriate request for a hearing into the matter. In this section, we set forth our observations and conclusions about the Jenson cases. In doing so, we wish to emphasize several limitations. We did not have the time and resources to fully investigate all of the underlying facts surrounding the two sets of criminal charges the OAG filed against Jenson (“Jenson I” and “Jenson II”). As a result, we focused not on the substance of these charges, but rather on the process and events surrounding his prosecution on those charges. We could not compel anyone to speak to us. Nor did we have the power to require the production of documents. All we could do was ask people with relevant information to meet with us voluntarily. We appreciate the cooperation of all who chose to do so – including many dedicated employees within the OAG, as well as Jenson and his team of defense attorneys. But as a result of the limitations we operated under, the ultimate resolution of some of the issues we sought to investigate must be left to criminal prosecutors, who have greater investigative powers, more investigative resources, and additional time in which to explore the questions surrounding the Jenson prosecutions. We also would emphasize that we were asked to investigate the allegations in the Jenson Petition relating to the Jenson case itself. Allegations similar to J enson’s have been raised in connection with the OAG’s handling of two other cases, notably the Jeremy Johnson case and a foreclosure lawsuit involving Bank of America. We were not requested to evaluate those two cases. Nor did we have the ability to investigate activities of government agencies outside the OAG.452 Despite these limitations, however, we believe we are in a position to draw some reasonable inferences and conclusions about the Jenson matter. Starting with Jenson I, Shurtleff initially met with a group of putative victims, including campaign contributors, who alleged that Marc Jenson had defrauded them. Although Shurtleff may have granted Ricke White greater access on account of his political contributions, we saw no evidence other than the timing of his contributions. Shurtleff purported to have an “open door” policy where he would listen to complaints from citizens. But there is an impression in the OAG that Shurtleff was a “meddler” only when the case involved people who had particular
Marc Jenson File, Utah Board of Pardons and Parole. For example, Jenson alleges that he was deliberately bunked in prison with a violent prisoner in retaliation for his complaints. Because these allegations involved actions by the Department of Corrections, we leave them to other investigators to pursue.
access or influence. And while it was rare for a case to originate as a result of input from the Attorney General, it was not unprecedented. In any event, after the complaint regarding Jenson came to Shurtleff, he referred it through standard channels to the Division of Securities. The investigation proceeded ordinarily, and we saw no evidence that he attempted to influence its outcome or evidence of any other impropriety during the process. Following the investigation, the case was assigned to an experienced (and, from all reports, very capable) line prosecutor, who determined that filing charges against Jenson was appropriate. A preliminary hearing was held and a judge determined that there was probable cause to believe that Jenson had committed the crimes charged.453 We did not see any impropriety in the charging decision in Jenson I. As the case proceeded, the line prosecutor offered Jenson a plea bargain within the normal range for charges of the type filed against him – a proposed resolution that would have required him to plead guilty to a second degree felony and pay restitution. Jenson’s criminal defense attorneys then had numerous communications with the line prosecutor and her immediate supervisors, but were unable to convince them to offer anything less than a felony plea. So Jenson proceeded to put together a separate channel of communication directly to Shurtleff. Jenson used his civil attorneys, who had recognized political clout, lobbyists, and others to contact Shurtleff and to attempt to convince him to dismiss the charges. Jenson himself met directly with Shurtleff. We do not necessarily fault Jenson for availing himself of these opportunities. But we do fault Shurtleff for allowing a separate, back channel to develop and particularly for his failure to include line prosecutors in those back channel meetings and communications. This was a clear deviation from standard policy. And what was communicated through these back channels (particularly by non-attorneys) remains unclear to us. But following these contacts, it is clear that Shurtleff overruled his line prosecutors and agreed to offer Jenson a highly unusual, no-contest plea in abeyance. We sought to ask Shurtleff why he made his decision. On advice of counsel, he declined to speak to us. As a consequence, we do not know his motivation for going against the recommendations of his Chief Deputy, the Chief of the Criminal Division, and the experienced line prosecutor responsible for handling the case – all of whom had greater familiarity with the facts than Shurtleff did. As former prosecutors, we find his actions and decisions quite hard to understand or to rationalize. Recognizing the significant role that Jenson and his advocates played to induce Shurtleff’s remarkably lenient plea offer, the question remains whether Jenson was disadvantaged by Shurtleff’s actions. Our conclusion is no. Jenson received a resolution that has been appropriately described as a “sweetheart deal.” Indeed, the initial offer would not have required Jenson to pay any restitution whatsoever. When the victims objected, the judge concluded that the proposed plea fell so far outside the range of an ordinary resolution that he had to reject it. Jenson and the OAG, again with Shurtleff’s intervention, then negotiated a new
Jenson sought to have Shurtleff and White testify at the preliminary hearing concerning White’s alleged political influence in the charging decision. The fact that an alleged victim was also a political contributor and may have received special access to the AG to register his complaint is not directly relevant to the issue of whether there was probable cause to believe that a crime had been committed by Jenson.
deal that required restitution and Jenson agreed to pay it. Jensen could have gone to trial if he believed that the charges were wholly unfounded, but he chose to take the deal. Following the plea, all Jenson needed to have done was make his agreed restitution payment within three years and the case would have been dismissed. He would have had no criminal record on account of these charges. And, indeed, his defense attorneys had discussed with the OAG the possibility that he would pay the full restitution in fewer than eighteen months and would then seek an early dismissal. During the ensuing three years, Jenson was repeatedly reminded of his obligation to make restitution payments. He attended several court hearings in which his responsibilities and the upcoming deadlines were highlighted, yet Jenson paid nothing to his victims. He made no payments while he was living what could be called, with some understatement, a lavish lifestyle. While Jenson was failing to pay restitution, Shurtleff, Swallow, and Lawson were also doing things that were highly problematic. Unfortunately, we are unable to fully explain what happened because these three important players all declined to speak to us. Jenson raises highly troubling allegations concerning their conduct. Some of his allegations are corroborated; but many are not and whether they will be corroborated remains to be determined. Most remarkably, it appears clear that Shurtleff accepted two expenses-paid trips to the luxurious Pelican Hill Resort in California, where he met with Jenson. Jenson had just been prosecuted for several felonies by Shurtleff’s office and continued to be under the informal probationary supervision of the OAG’s Criminal Division. The impropriety of Shurtleff’s actions is demonstrated by his own efforts to hide what had happened. Shurtleff concealed the trips from others in the OAG and then, when they later questioned him, he claimed he had just “bumped into” Jenson while in California. Of course, Jenson paid for the trips and it is hard to believe that Shurtleff did not know it.454 Shurtleff himself admitted that there were discussions regarding campaign fundraising and a possible movie deal for his book. He claimed that he rebuffed the offers, but there is no justification whatsoever for Shurtleff to have had such interactions with Jenson. Swallow’s involvement also raises significant concerns, given his roles as fundraiser for Shurtleff and soon-to-be heir apparent. And the presence of Lawson, a selfdescribed “fixer” and representative of Shurtleff, does nothing to improve the already-sordid picture. Lawson has already been criminally charged for his activities. And whether Shurtleff and Swallow will also be charged is the subject of an independent investigation. The question we focus on is whether Jenson was prejudiced in any way by the actions of the OAG. Jenson appears to claim that he was coerced by Shurtleff into paying money to Lawson and suggests that because of these coerced payments he was left with no money to pay restitution. Yet, if we understand his petition correctly, Jenson does not claim that Shurtleff actually excused him from paying his $4.1 million in restitution – restitution that had been ordered by the court, not Shurtleff. Nor does it appear that these payments would explain Jenson’s failure to pay any restitution whatsoever. We have confirmed $114,300 in payments from Jenson to Lawson’s company, all made during the first seven months of 2009 (during which Shurtleff and Swallow
Based on a review of monies flowing through Jenson’s accounts at the time, it is likely that Shurtleff’s vacations were being paid for with monies from other questionable activities on the part of Jenson.
traveled to Pelican Hill).455 Even assuming (without corroborating evidence) that Shurtleff somehow approved these payments to Larson as having priority over restitution, it is unclear to us why Jenson nonetheless failed to use any of his remaining funds to pay restitution. For example, we do not understand why he thought it was better to pay for three expensive villas at Pelican Hill rather than use those funds to pay restitution to his victims. We have also seen evidence that many millions of dollars were passing through Jenson’s bank accounts during his restitution period. Marc Jenson was willing to speak to us at length. But even after meeting with Jenson, we are uncertain how his allegations would amount to a defense to his failure to pay restitution. We cannot help but think that if Jenson had made some reasonable effort to pay restitution, the judge would have given him more time to fulfill his obligation. Jenson, of course, could have raised all these issues during the hearings in 2011 on whether he had violated the terms of his plea in abeyance. Jenson knew better than anyone what he had discussed with Shurtleff, Swallow, and Lawson. And yet he chose not to present the issue at this time. Perhaps his reason for failing to raise the issue then is that he felt he lacked sufficient corroborating evidence of what had happened. Indeed, it appears that Jenson is now taking the position that the evidence surrounding, Shurtleff’s actions is exculpatory “Brady” or “Giglio” material that should have been turned over to him.456 Whether it truly is such material is debatable. But the situation where an Attorney General was having personal interactions with a criminal defendant his office was prosecuting seems to be truly unprecedented. Rather than enter into a Brady debate in such uncharted terrain, it is our recommendation that the OAG simply provide Jenson’s counsel with a copy of this report and the accompanying appendix. It is also our recommendation that the State not oppose any appropriate request by Jenson for a hearing at which he can present evidence relevant to issues properly before the court. What form that opportunity should take is not for us to say, but rather depends on the filing of an appropriate petition and a determination by the judge handling the matter. We note that we have considerable doubt whether many of Jenson’s allegations are relevant to the issue of why he did not pay the restitution ordered by the court, as well as serious questions about Jenson’s own involvement in the activities about which he complains. But, given the allegations that have swirled around involvement of the Attorney General and the notoriety of the entire situation, we believe that confidence in the criminal justice process will best be served if the State agrees to some appropriate public process for airing the matter in a court of law. It is our conclusion that any misconduct in the handling of Jenson I did not extend beyond Shurtleff (and Swallow) to, for example, the Criminal Chief Deputy (Kirk Torgensen) or
We have also seen figures of $120,000 and $200,000, but we have not been able to corroborate those numbers. Also, we do not have access to Lawson’s bank accounts so we cannot determine what he did with the money. 456 At the risk of oversimplifying, Brady material is evidence possessed by the State that is exculpatory to a defendant – material that must be produced to a defendant under Brady v. Maryland, 294 U.S. 103 (1935). Giglio material is evidence possessed by the State that might be effectively used to undercut the credibility of a Government witness – material that must be produced to a defendant under Giglio v. United States, 405 U.S. 150 (1972).
the Chief of the Criminal Division (Scott Reed).457 To the contrary, we found that Shurtleff was repeatedly warned by these employees and others about problems posed by his private meetings and involvement with Jenson. Shurtleff knew that these experienced prosecutors would have objected strongly had he told them, for example, that he was going to Pelican Hill to meet with Jenson, which is presumably why he went to great pains to conceal such activities from them. Shurtleff’s activities descended to such a low point that senior attorneys within the OAG began to wonder about whether he was a “spy” passing along adverse information to Jen son and whether he was contemporaneously exchanging text messages with Jenson while OAG prosecutors were prosecuting him in court. Once these employees began to learn more fully about Shurtleff’s extraordinary behavior, reasonable minds can differ over whether they – particularly Torgensen since he was Chief Deputy and Reed’s supervisor – could have or should have done more to take him to task. But we appreciate that Shurtleff was not simply a “boss,” but the elected Attorney General for the State of Utah. We can only hope that in the future OAG attorneys will not face such difficult and truly unprecedented dilemmas. Our greatest disappointment about Shurtleff’s activities is that they unfairly brought into disrepute the reputations of many fine and dedicated employees in the OAG. With regard to the pending charges filed against Jenson in the Mt. Holly case (Jenson II), this matter has also been clouded by the Attorney General’s involvement. Within days of his first trip to Pelican Hill, Shurtleff personally received materials from Jenson’s brother and others alleging that principals of XE Capitol had defrauded the Jenson group relating to Mt. Holly. Shurtleff ordered a quick investigation by the OAG. The matter was investigated by Doug Townsend and screened by the OAG. The screening committee determined that it was merely a “business deal gone bad” and not a criminal violation. This same Jenson group later unsuccessfully sought to get Shurtleff to intervene to prevent a foreclosure sale by the XE Capital group. Later in 2009, Shurtleff was approached by Tim Bell, who was, or would shortly be a Shurtleff fundraiser, and attorneys for Jeffrey Donner with complaints that they had been defrauded by Jenson in the Mt. Holly venture. Again in March 2010, Bell renewed his effort to get Shurtleff to investigate Jenson regarding Mt. Holly. Given the fact that Shurtleff was contemporaneously meeting with adverse groups, each of which apparently had access on account of contributions or favors provided to Shurtleff, some
We do not approve of Kirk Torgensen’s decision to order the deletion of emails from his “trash” file in 2011 or 2012. This issue was not directly part of our mandate, which focuses on the Jenson Petition. Torgensen claims that his decision to delete the emails was made for personal reasons and was not an attempt to conceal evidence. It is possible that the deletion of the emails coincided with a time of signifi cant personal strife in Torgensen’s life, but we note that it was a wholesale deletion of his trash emails and not just those to or from particular persons. Torgensen said he thought he was only deleting them from his computer and not from the system. He is not the only one in the OAG who believed that all OAG emails were backed up on a state government server elsewhere. It is also not clear to us whether the OAG had in place at the time any general prohibition against deleting emails, particularly emails that had already been moved to a “trash” file instead of to a “file” account for future reference. In any event, we believe that we have been able to locate from other sources the majority of emails relevant to the Jenson case that Torgensen may have deleted, so we did not pursue the matter further. Of course, we have limited information available to us on this issue and have only considered it insofar as it relates to the Jenson matter.
ambiguity must necessarily cloud the decision to initiate an investigation of Jenson. But after May 2010, no such ambiguity exists, at least based on what we have seen. The case was assigned by Ken Wallentine to two investigators in the ordinary course of business. The case appears to have been appropriately investigated and screened by line prosecutors. Before the OAG ultimately decided to file criminal charges, both Shurtleff and Swallow had been screened from the decision-making process. After the charges were filed, a judge found that they were supported by probable cause. It is hard to see a procedural problem in the conduct of the investigation and prosecution after the decision to investigate. We emphasize that we have not assessed the merits ofthe charges. We find some modest fault in the handling of the Jenson II prosecution later in the process. The OAG debated internally whether to recuse from the case in May, 2012 in light of allegations that had come to light regarding the conduct of Shurtleff and Swallow vis-à-vis Jenson. With the benefit of hindsight, we conclude it would have been better if the OAG had simply made an effort to transfer the case to another prosecutor at that time. We concede that it may have been more difficult to convince another prosecutor to take the case before it was bound over. And we are not convinced that there was a formal conflict of interest that would have required recusal. But given the allegations concerning Shurtleff, Swallow, and Jenson at Pelican Hill — and the upcoming primary and general elections — it was unwise to keep the case in the office. It should have been transferred in May 2012, not because retaining it caused any prejudice to Jenson, but because doing so unnecessarily contributed to a continuing appearance that something unusual was at play. In any event, the case was eventually transferred to the Utah County Attorney's Office and is no longer the responsibility of the OAG. And to the extent that our investigation has uncovered any Brady and Giglio material, providing Jenson's defense counsel with our report should eliminate any issue. These are the conclusions that the two of us have both reached about how the OAG handled the Jenson case. We admit that our conclusions must be necessarily tentative. As noted earlier, both of the previous Attorneys General — Mark Shurtleff and John Swallow — declined our requests for interviews. While they have a constitutional right not to be compelled to incriminate themselves, their refusal to talk to us has necessarily impaired our ability to report to the current Attorney General about what happened in th Jenson case. Sadly, their refusal continues to contribute to a lack oftransparency and public nfidence about what happened.
PAUL G. CASSELL,ESQ
NCIS M. WIKSTROM,ESQ.