Former politician Larry Bates played on the beliefs of fellow Christians to sell gold and silver that he never delivered
By Hubert Walker for CoinWeek ….
Seventy-year-old Larry Bates is a talk radio CEO, a former Tennessee state representative, and a gold and silver bullion dealer.
Now, after a five-week trial in Memphis back in May, he is also a convicted felon.
A federal jury convicted Bates, who bought and sold silver and gold coins through his companies First American Monetary Consultants (FAMC) and Information Radio Network, Inc. (IRN), of 46 counts of mail and wire fraud stemming from a multi-million dollar Ponzi scheme. The Office of the United States Attorney for the Western District of Tennessee made the announcement May 3.
Members of his immediate family also stand convicted of various counts of conspiracy and mail and wire fraud. A sentencing hearing has been scheduled for August 3, though Bates and his sons face a civil trial this summer wherein the members of a class action lawsuit hope to recoup their money.
From the city of Martin, Larry Bates served as a Democrat in the Tennessee State House of Representatives from 1971 through 1976, where he was the chair of the Tennessee House Committee on Banking and Commerce. Bates ran for the United States House of Representatives in 1976 but lost in the primary.
He later moved to Memphis, where he became a Republican.
Claiming to be an economist, Bates established First American Monetary Consultants in 1985, and was the company’s chairman until it went out of business. With offices in Memphis and Boulder, Colorado, FAMC offered expertise in the fields of banking, government, business planning, intelligence, economics, economic development, finance and forecasting to businesses and politicians. He was also the editor and publisher of a periodical entitled Monetary and Economic Review, as well as the author of two books: The New Economic Disorder: Strategies for Weathering Any Crisis While Keeping Your Finances Intact (2008) and A Nation in Crisis–The Meltdown of Money, Government and Religion: How to Prepare for the Coming Collapse (2010)–the last of which he cowrote with his son, Charles “Chuck” Bates.
But the heart of Bates’ interlocking enterprises is perhaps the Information Radio Network. IRN featured political and economic news and commentary from a right-wing Christian viewpoint. And between May 2002 and October 2013, Bates ran advertisements soliciting listeners to buy gold and silver as protection against the “Mystery Babylon” of biblical prophecy.
3 So he carried me away in the spirit into the wilderness: and I saw a woman sit upon a scarlet coloured beast, full of names of blasphemy, having seven heads and ten horns.
4 And the woman was arrayed in purple and scarlet colour, and decked with gold and precious stones and pearls, having a golden cup in her hand full of abominations and filthiness of her fornication:
5 And upon her forehead was a name written, MYSTERY, BABYLON THE GREAT, THE MOTHER OF HARLOTS AND ABOMINATIONS OF THE EARTH.
—Revelation 17:3-5 (King James Version)
Most experts believe that the Book of Revelation (also known as the Apocalypse of John) was written in the second half of the first century CE, sometime during the reign of the Flavian dynasty (69 – 96 CE) of the Roman Empire. The identity of the author remains a mystery; even though they identify themselves as “John”, it is unclear whether the John of Revelation is the same John who was one of Jesus’s apostles. Scholars tend to support the notion that they are different people.
It was also the last book added to biblical canon, with significant controversy and disagreement about its worthiness having developed by the third century CE. And among those churches and denominations that do accept Revelation, there are still arguments about what, exactly, the Book of Revelation means. Some believe that it is symbolic and allegorical, and not to be taken literally. Others believe that it describes events that had already happened by the time it was written. Still others believe that it describes future events leading up to the Second Coming.
And to those who believe it is a prophecy of the end times, the identification of “Mystery Babylon” has been a longtime preoccupation, with often controversial results. The Vatican (and Catholicism in general) is a frequent target. In the contemporary United States, America–especially under the leadership of politicians seen as “liberal”, though hardliners can take a very pessimistic view of the entirety of American culture, regardless of political leaning–is sometimes labeled as such.
In his pitch, Larry Bates interpreted “Mystery Babylon” to mean a coming economic, spiritual and political catastrophe that would devastate the U.S. along with the rest of the world.
But have hope. There was something that decent, god-fearing Christians could do to survive these tribulations before Judgment Day.
The Federal Government claims that Bates purposefully targeted Christians and the elderly with his “End of the World” scheme, which again, started in 2002 and ran for more than 11 years.
Bates promoted the buying and selling of silver and gold coins on his radio network, and hundreds of listeners responded. The government’s case against Mr. Bates states that there were over 360 victims, many of them elderly. Many victims stated that they bought the precious metals from Bates and his company specifically because he presented himself as a devout Christian. One victim, a pastor from Mesa, Colorado named Charles Grimsley, testified that he and his wife gave FAMC $200,000 out of their retirement funds. The pastor and his wife never got their order.
More than 300 customers received an invoice confirmation in the mail, but after their payment went through, no gold or silver was ever delivered. Calls and emails from customers asking about the status of their orders were often slow to be returned, if they were returned at all.
When a customer actually managed to make their complaints heard, Bates and his employees (mostly members of his immediate family) would make promises to rectify the situation that were soon broken.
When Bates’ victims demanded their coins, they were often given an excuse as to why the company could not deliver the product at this time. Sometimes the gold coins were too scarce. Sometimes they were being shipped from Europe. Sometimes the United States Mint had shut down…
On top of that, Bates embezzled company proceeds for personal use. Before the radio station was up and running in Memphis, Larry Bates would convey the same message at conferences he organized, predicting economic pandemonium and emphasizing the necessity of investing in precious metals. Four million dollars worth of revenue from subsequent sales eventually went into the creation of IRN itself.
Bates also rerouted company money into his own commodities trading activities and a 10,000 square-foot mansion.
Over the years, customers gave FAMC about $87 million in exchange for gold and silver. By the year 2009, FAMC had accumulated $26 million in unfulfilled orders, affecting customers from Tennessee, Texas, Alabama, Kansas, Vermont, Oklahoma, Missouri, Florida, Massachusetts, among many others.
Receivership and Trial
Finally, a class action lawsuit was filed against the company in 2012 (Case No. 2:11-cv-01396, U.S. District Court, Western Dist. of Tenn., Western Section). As a result, the court placed First American Monetary Consultants in receivership, and the receiver who oversaw the company’s finances concluded that FAMC would not be able to compensate its victims.
The company went out of business shortly thereafter.
In 2015 Bates, along with his sons Chuck and Robert (and Robert’s wife Kinsey), was indicted by the feds on several counts of mail and wire fraud. The case was investigated by both the United States Postal Inspection Service and the Federal Bureau of Investigation (FBI). Assistant U.S. attorneys Larry Laurenzi (acting U.S. attorney for the Western District of Tennessee) and David Pritchard prosecuted the case in court.
None of this deterred Larry Bates.
In a defiant statement weeks before the trial, Bates claimed to be the victim of a conspiracy by the powers-that-be, out to silence him for revealing the truth. He referred to the indictments and his prosecution as “institutional tyranny”, and said that the would be cleared of all charges.
“Are they going after Bates because he stole money or because he’s telling it like it is? He says the system is going to collapse,” said Bates lawyer Duncan Ragsdale.
Responding to such claims, John Ryder, the lawyer appointed as receiver to manage the assets of FAMC after the class action lawsuit, said “He was not targeted for any other reason, other than a lot of people that gave his company money, or precious metals, didn’t get anything in return.”
Making more excuses, Bates said that health problems got in the way of filling orders, and that an employee he trusted to run the company while he was ill was more to blame than he was.
He also argued for the complete dismissal of the case against him, seizing upon the fact that in January of 2017, a witness for the prosecution admitted to stealing up to $400,000 in cash and coins from FAMC customers. Receiver John Ryder pointed out that the amount of this theft was far less than the amount of money Bates and the company had taken in as a whole for gold and silver that it never delivered.
And to top it all off, Bates also declared–with a fair amount of chutzpah–that the prosecutors in the U.S. Attorney’s Office should “confess their sins”.
“I have to say, I do say, the devil and all the devils that are being controlled by Satan himself. I mean we [have] a courtroom full of devils here. I just say to them I pray for your salvation and pray you will repent,” he said in court.
In the end, Larry Bates was convicted of all 46 counts as in the indictment.
His son Chuck Bates was found guilty of 18 counts of mail and wire fraud and one count of conspiracy to commit mail and wire fraud.
Larry’s other son Robert Bates was convicted of five counts mail fraud, three counts wire fraud, and one count of conspiracy.
Kinsey Bates, Robert’s wife, was found guilty of one count conspiracy and two counts wire fraud.
Each count of mail and wire fraud carries a possible maximum sentence of 20 years in federal prison. Each count of conspiracy carries a maximum sentence of 20 years and a $1 million fine.
Western District judge Sheryl H. Lipman will preside at their sentencing.
* * *