Months after release from federal prison, TV pitchman Kevin Trudeau could face jail again




  • In US
  • 2022-12-01 00:09:00Z
  • By Chicago Tribune

CHICAGO - TV pitchman Kevin Trudeau was warned years ago by a federal judge that a 10-year prison sentence for contempt wasn't going to magically erase the whopping $37.6 million civil penalty he still owes for lying about his controversial weight-loss book.

"He told me he was broke when he had hundreds of millions of dollars going through his hands," U.S. District Judge Robert Gettleman said back in 2015. "When he gets out, we're going to be going right back into this."

Now, months after Trudeau was released from federal prison, he could soon find himself back behind bars after Federal Trade Commission attorneys told Gettleman they believe the self-described infomercial king turned convicted fraudster is still hiding potentially millions of dollars in assets overseas.

In a letter to the judge on Monday, the FTC said Trudeau had not responded to a request for a detailed accounting of his assets, including any cash, gold bars, jewelry, vehicles and safe deposit boxes, as well as an inventory of a storage facility recently visited by his ex-wife in Switzerland, court records show.

After nearly 20 years of thumb-nosing from Trudeau, the government doesn't seem to be holding its breath that he'll suddenly come clean.

"Coercive incarceration is the only way to force Trudeau to comply with the court's orders to redress all the consumers his contumacious conduct injured," FTC attorney Jonathan Cohen wrote.

At a hearing Wednesday, Cohen revealed newly discovered emails that he said show Trudeau was seeking to ship and store 300 pounds of gold bars and other precious metals in Switzerland in 2013, the same time he was crying poor to the court.

The FTC has also learned that around the same time, Trudeau hired two law firms in Switzerland to research what impact pending lawsuits in the U.S. would have in Switzerland as well as the logistics of legally changing your name in that country, Cohen said.

Trudeau's attorney, Giel Stein, accused the FTC of jumping the gun, saying Trudeau "is acutely aware of the consequences here" and only wants to know how much he still owes so he can figure out how to begin repaying it.

Stein also said it made no sense to put Trudeau in jail before he's given the chance to answer questions under oath about his assets at a deposition, which is scheduled for Dec. 9.

Seated at the defense table, Trudeau nodded in agreement as his attorney spoke. Unlike a decade ago when he always appeared in court in tailored suits and black-coiffed hair, Trudeau on Wednesday was wearing an untucked shirt and Adidas track pants.

In addition to the repayment of the judgment, Gettleman has also ordered Trudeau to show why he should not be held in contempt "yet again" for failing to report to the court when he was released from incarceration in May, which he had promised to do.

The judge declined to incarcerate Trudeau immediately, however, instead setting a Dec. 15 hearing to decide both issues and possibly order Trudeau back into custody. In the meantime, the judge has ordered the formerly jet-setting Trudeau to remain in the Chicago area.

"There's a lot of history between Mr. Trudeau and this court," Gettleman said. "We don't have to ignore that history."

Trudeau, 59, was convicted in 2014 of criminal contempt for violating a consent order in which he promised to stop making the misleading ads touting his hit book, "The Weight Loss Cure 'They' Don't Want You to Know About."

More than 800,000 people bought the book that Trudeau claimed was filled with "easy" weight-loss techniques when it called for prescription injections of a hormone found only in pregnant women, a month of colon hydrotherapy and a 500-calorie-per-day diet.

Trudeau was sentenced to 10 years in prison by U.S. District Judge Ronald Guzman and was released from a minimum-security federal prison camp in Alabama in January, followed by a stint in a halfway house that ended in May.

But the contempt case was separate from the civil suit brought by the FTC in 2004 that led to Gettleman's judgment order. After Trudeau failed to pay a penny of what he owed, a court-appointed receiver was able to recover about $8 million in Trudeau's assets, but the rest of the debt remains outstanding.

Shortly before Trudeau entered prison, the receiver released a report alleging Trudeau was still hiding tens of millions in an elaborate "asset protection plan" that diverted funds to banks in Switzerland and the Caribbean as well as various business entities and shell companies controlled by his wife and his personal attorney, Marc Lane.

In all, Trudeau's vast business empire collected more than half a billion dollars in revenue from 1999 to 2013, according to the receiver's report at the time.

Gettleman said the report was further evidence that Trudeau lied under oath when he repeatedly told the court two years earlier that he was penniless, even though he continued to lead a lavish lifestyle that included jetting around the world.

The judge said then that if Trudeau thinks there will be a "pot of gold" waiting for him when he's released, he should reconsider.

A charismatic motivational speaker, Trudeau had a two-year prison stint in the early 1990s for credit card fraud, records show. After his release, Trudeau transformed himself into an author, growing his business from his base in suburban Chicago and touting products such as pain-relief adhesive tape and a cancer cure involving coral calcium.

Soon his infomercials began popping up across the country advertising solutions for everything from hair loss and weak memory to excessive levels of debt.

After federal authorities started cracking down on his informercials, Trudeau started a new venture called the Global Information Network, which the FTC described as a multilayered "club" founded in the notorious Caribbean asset shelter of St. Kitts and Nevis.

The club charged membership fees in exchange for the wealth- and success-building secrets of its anonymous but allegedly rich and famous founding council. Members who recruited others to join receive a portion of each new member's dues, and the company sponsors lavish gatherings on cruise ships as well as smaller events in more than 150 countries, according to court records.

Meanwhile, the FTC alleged that Trudeau and his then-wife, Ukrainian-born Nataliya Babenko, were using Rivers Casino in Des Plaines to launder money, buying up hundreds of thousands of dollars in chips in the high rollers area and cashing them in after a short time gambling at the tables.

Authorities traced records that linked Trudeau to a $1.5 million home in coastal California and a $340,000 Bentley car registered in his name, while other companies were paying the $12,000-a-month rent on his suburban Chicago mansion as well as Trudeau's travel expenses on a private jet and meals at expensive restaurants, according to the court records.

Court records show Babenko filed for a marriage annulment in Los Angeles last year, which was granted several weeks ago.

Stein said Wednesday he wants to question Babenko under oath about "eight suitcases of materials that (she) absconded with" from Trudeau's storage facility in Zurich.

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