Utsick Waits In Brazil

Once-prominent concert promoter Jack Utsick is facing a new round of legal problems, including an FBI criminal investigation and a potential contempt citation since he moved to Brazil in 2007.

He’s missed two court-ordered appearances and is attempting to postpone a third because he believes he will be arrested if he returns to the U.S., according to his attorney, D.C. lawyer Richard Kraut.

While his receivership estate was granted permission Jan. 21 by a Florida judge to begin making disbursements to investors, the Securities and Exchange Commission continues to look into his finances. Now, the FBI is investigating Utsick for allegedly diverting millions from his investors to pay for rare cars, artwork, his luxury South Beach condo and other “personal” expenses.

Utsick has contended that he did not receive a salary when he ran Worldwide Entertainment, and those expenses were paid in lieu of salary.

Utsick, through his Washington attorney, filed papers in Miami’s U.S. District Court Feb. 4 opposing an SEC motion for contempt proceedings and other sanctions against him.

“I think the government is being heavy handed,” Kraut told Pollstar. “Jack has also offered an offer of settlement to the SEC, which is confidential and included in the filings.”

According to court documents cited by the Miami Herald, Utsick left his Florida home and moved to Brazil in 2007, but not until after he’d allegedly sold a Porsche and a Mercedes-Benz and pocketed the money – in violation of a court order ordering his companies and assets frozen.

Records state that Utsick has “refused” to return to the States despite two court orders to return to Miami in the civil case. Kraut said he did not know whether Utsick would enter the States for a third court date Feb. 6.

“The key point is the SEC wants answers to their questions and Jack is prepared to answer their questions about the so-called ‘personal’ expenses to show they are business expenses and that the dollar amount was nowhere near as high as the SEC claims,” Kraut said. “But he wants to do so outside the U.S. If the SEC wants answers, the reasonable question is, why don’t they go to [Utsick in Brazil] or a reasonable other place?”

The question could as easily be asked why Utsick doesn’t just make the Miami court appearance.

“He’s requested assurance of safe passage in and out of U.S. and the Department of Justice and the SEC have not provided that assurance,” Kraut explained. “Under those circumstances, why can’t they go someplace else to take the depositions? We infer that they want to lure him in so they can arrest him, and that’s wrong.”

In addition to motions filed opposing the SEC’s request for a contempt citation and requesting the court vacate the order compelling Utsick to appear in Miami or postpone the Feb. 6 hearing, Utsick also filed a final settlement offer in the case that includes an irrevocable trust agreement for the benefit of participants of the Entertainment Group Fund, Inc. and American Enterprises, Inc.

The latter corporation was headed up by Robert and Donna Yeager, former Utsick partners who were also sued by the SEC in the case. Kraut could not confirm that the FBI is also conducting a criminal investigation of the Yeagers but added, “that would be a fair inference.”