Kiley Denies Role in Cook’s Ponzi Scheme
Pat Kiley, a former nationally syndicated local radio personality, on Thursday filed a formal response to a suit that was brought against him by the U.S. Security and Exchange Commission (SEC), which accused him of having a role in running a Ponzi scheme with Trevor Cook.
According to Kiley's response, which was filed in U.S. District Court in Minneapolis, he was misled and conned by Cook and was not aware of any illegal misconduct until July 2009.
Cook, 37, was charged in March and pleaded guilty in April to one count of mail fraud and one count of tax evasion. In August, he received the maximum prison sentence of 25 years in prison for his involvement in the scheme. Kiley has not yet been indicted in the case.
In his response, Kiley admitted that he taped a weekly radio show in which he promoted a foreign currency program for investors. However, Kiley claims that he did not know that his statements about the program-that it involved little or no risk and that the investors' principal would be safe and could be withdrawn at any time-were false until investors filed a suit in July 2009 saying they couldn't access their money.
Kiley also claims that he did not control any of the shell companies Cook used to carry out the scheme. Kiley said in his response that although Cook listed him as an owner for the shell companies-UBS Diversified Growth, LLC, Universal Brokerage FX Management, LLC, Oxford Global Advisors, LLC, and Oxford Global Partners, LLC-Kiley “never wrote one check or sent any wire transfers related to the [companies].”
The SEC filed its suit against Kiley in November and obtained emergency orders to freeze the assets held by him and Cook, their four business entities, and about a dozen “relief defendants,” including Cook's in-laws.
Kiley's response isn't the first time he has spoken out against the allegations. In August, Kiley filed a $42 million defamation suit against the Star Tribune, the Pioneer Press, several reporters, and other associates. Kiley claimed that the media outlets printed false statements about his involvement with Cook's Ponzi scheme, which caused severe damage to his reputation and character.