Federal appeals court orders Jeremy Johnson be resentenced in fraud case

April 19, 2018 Utah Channel 3

ST. GEORGE – The 10^th Circuit Court of Appeals shot down convicted St. George businessman Jeremy Johnson’s prison sentence Thursday and has ruled he be resentenced.

The U.S. District Court in Utah sentenced Johnson to serve 11 years in prison in 2016 after a jury of eight found him guilty of eight charges of making false statements to a bank. He was acquitted of 78 other chargers related to fraud, money laundering and conspiracy.

According the 49-page judgment rendered by the Appeals Court, the court agreed with Johnson that the U.S. District Court in Utah “erred in assessing a two-level enhancement based on its finding that Johnson received more than $1 million as a result of his offenses … we reverse his sentence and remand for resentencing.”

However, the Appeals Court did not overturn Johnson’s conviction, but rather reaffirmed it.

“I find it disheartening that the conviction was affirmed,” Johnson’s attorney, Karra Porter, said, as reported by The Salt Lake Tribune. “He’ll still be serving more time than people who committed far more serious crimes.”

The charges Johnson was convicted on stem from a Federal Trade Commission investigation into his I Works online marketing company that sold information on how to apply for federal grants and other moneymaking possibilities. When the company began to experience a high level of people demanding refunds in the form of credit chargebacks, it was placed on a warning list advising banks not to do business with the company.

Federal prosecutors said Johnson and the others attempted to get around this by creating shell companies using the names of employees, friends and family members in order to create the new accounts.

The FTC launched an investigation into the matter that resulted in Johnson’s arrest at the Phoenix airport in 2011 and conviction five years later.

Prior to his conviction, Johnson accused federal prosecutors and regulation of government abuses, which led to the court putting Johnson under a gag order.

Johnson’s lawyers accused federal prosecutors of threatening friends and family with indictments if he didn’t accept a plea deal. A motion to have the case dismissed due to alleged prosecutorial misconduct was also filed and denied by U.S. District Judge David Nuffer, who presided over the case.

Following the jury trial, some jurors have said they believe Nuffer’s conduct during the trial was biased toward the prosecution, according to a report by The Salt Lake Tribune.

Johnson’s name has also become synonymous with one of the state’s biggest political scandals in recent years involving former Utah Attorneys General Mark Shurtleff and John Swallow.

Johnson alleged that Swallow was going to arrange a bribe of then-U.S. Senate Majority Leader Harry Reid, D-Nevada, on behalf of the St. George businessman. Allegedly, it was hoped the Nevada senator would use his influence to get the FTC off Johnson’s back.

The accusations triggered multiple investigations into Shurtleff’s and Swallow’s conduct and led to accusations of both men asking for gifts and donations from people who were facing investigation by the Utah Attorney General’s Office. The scandal ultimately led Swallow to resign as the attorney general after barely a year in office.

Read more:

Both men were arrested and charged with offenses related to public corruption in June 2015. Swallow and Shurtleff have both professed their innocence throughout the investigation and resulting court cases.

Charges against Shurtleff were drops in 2016, while a jury declared Swallow innocent of corruption charges in 2017.

Email: mkessler@stgnews.com

Twitter: @MoriKessler