Hidden gold, cash keeps St. George multimillionaire behind bars

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SALT LAKE CITY — Gun safes jammed with gold coins and $100 bills rolled into $10,000 bundles. A room lined with hundreds of silver bars. Tales of gold and currency stashed in remote mountain locales accessible only by helicopter. Submersible bags waiting to be stuffed with money and dropped into lakes.

Those astounding things are what a former business partner of Jeremy Johnson says he saw of the St. George man during the course of their nearly two- year friendship.

And the reason for stashing away million of dollars?

"Just in case the government goes after you. You have to have a lot of gold and cash," Chad Elie says Johnson told him in early 2009.

Federal prosecutors called Elie, of Las Vegas, to testify at a hearing Thursday to determine whether Johnson should be released from jail pending the outcome of his case.

Just in case the government goes after you. You have to have a lot of gold and cash.

–Chad Elie

Johnson, 35, faces one count of mail fraud in connection with an alleged Internet marketing scheme in which federal authorities contend consumers lost hundreds of millions of dollars.

Friends and family put up a $1 million property bond to ensure Johnson's appearance at future court hearings.

And although U.S. District Magistrate Judge David Nuffer deemed those people "credible, reliable and reputable" and the bond "very secure," he said he wasn't confident that Johnson would appear based on his access to cash, mobility, pilot's license and overseas contacts.

The decision stunned and left sobbing about two dozen of Johnson's supporters in the courtroom, including those who put up their property and homes for the bond. Johnson sat with his head on the table crying as Nuffer ruled.

Defense attorney Mike Hansen told the judge he could think of only one white-collar case in 32 years of practice where the defendant fled.

"It just doesn't happen in white-collar cases," Hansen said.

Johnson could appeal Nuffer's decision, and Hansen said after the hearing that the defense was "considering all of our options."

Johnson has been in jail since being arrested at the Phoenix airport en route to Costa Rica on June 11 with $26,400 cash in a shoebox in his carry-on bag.

In addition to the criminal charge, Johnson faces a Federal Trade Commission complaint filed last December alleging his online companies bilked more than $275 million from at least 1 million consumers. A federal judge in Nevada froze all of his assets and placed him under tight financial restrictions.

Prosecutor Brent Ward contends Johnson planned to live permanently in Costa Rica and establish another Internet marketing business. Johnson's attorneys say he traveled there several times to set up a helicopter tour company and had no intention of living there.

But another witness testified otherwise.

"He told me he was moving down there. He said he'd had enough of it here," said Dennis Clark, a longtime friend of Johnson's who teared up on the witness stand.

Clark drove Johnson from St. George to the Las Vegas airport three or four times since January. Each time, he said, Johnson carried as much as $50,000 in cash, though he lost $20,000 playing blackjack on one trip.

On that occasion, "We got eighty-sixed. We got kicked out of the casino," Clark said. He said the pit boss told Johnson he owed the casino $100,000.

Johnson admitted in a deposition in the FTC case that he's addicted to gambling and lost millions of dollars in casinos and playing online poker.

Elie testified that he and Johnson started an e-payment processing company called Elite Debit whose clients included two Internet poker sites, Full Tilt Poker and Poker Stars.

Elie was among 11 men indicted in the Southern District of New York indicted this year in connection with a conspiracy involving the three largest Internet poker companies.

They are accused of tricking some U.S. banks and bribing others to assure the continued flow of billions of dollars in illegal gambling profits.

Email:dromboy@ksl.com