Republic Monetary Exchange Sued by Secret Investor, CEO's Old Buddy, Sherman Unkefer
Republic Monetary Exchange, a prominent Phoenix gold-selling firm, has been sued by an investor whose role in the firm had originally been kept hidden.
The investor, Sherman Unkefer, happens to be an old buddy of Republic Monetary's ex-con CEO, Jim Clark.
The two previously were leaders of North American Coin and Currency, a multi-million-dollar precious-metals company based in Phoenix that infamously went belly-up in 1983. Unkefer served prison time for his role, while Clark did eight months in prison in 1993 for an unrelated scheme.
They joined forced again three years ago when they created Republic Monetary Exchange, which is located at 4040 East Camelback Road.
Now, Clark seems to be trying to force Unkefer out.
Sherman Unkefer's Department of Corrections mugshot from the 1980s.
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In a nutshell, the company that manages a trust account for Unkefer's deceased wife, Occidental Resources, has sued Republic Monetary over a lack of payment. Occidental owns 30.4 percent of Republic, according to the lawsuit, and Unkefer is the general partner of Occidental.
Unkefer claims in the May lawsuit filed in Maricopa County Superior Court that Republic Monetary should be making regular payments to him, but isn't.
This is just the latest financial headache for Unkefer, a star salesman for a company that sells an alleged health-juice. Unkefer boasts that he's made millions in juice marketing, but his reputed fortune is on the line: The Maricopa County Attorney's Office still wants Unkefer to pay a $7.5 million criminal restitution order from 1988. A judge may rule on the order later this year.
Clark and Unkefer's relationship was tight back in the days of North American, during an earlier gold craze. Unkefer had been the president, and Clark the vice-president, secretary and treasurer.
Unkefer served eight years in prison for criminally mismanaging the firm and cheating hundreds of clients out of their investments of silver and gold. And he was ordered to pay millions in restitution.
Clark faced no legal consequences for the firm's problems. But he was later sentenced to prison for selling unregistered securities at a separate Phoenix company he owned, Sheffield Metals. He recovered his financial footing after years of working in the vending-machine business, but he never paid back $1.5 million in court-ordered restitution.
Three years ago, Clark began his latest venture, Republic Monetary Exchange.
Two months after Unkefer's wife, Sharon, died, her trust account sunk more than $200,000 into Clark's business to help start it.
As a July 2010 New Times article exposed, Arizona Corporation Commission records hid Unkefer's involvement behind the name of a purported California corporation, Occidental Resources.
Clark's lawyer, John Jakubczyk, told New Times last year that Unkefer had no role in the business and that Unkefer's dead wife's trust, not Unkefer, owned the interest in Republic Monetary Exchange.
Last week, Jakubczyk admitted he'd given incorrect information to New Times, but claimed he didn't realize it was wrong. Since last year's article was published, Jakubczyk says he's "come to find out" that Unkefer made his initial investment to Republic Monetary by way of personal checks.
However it was done, Occidental Resources -- actually a Nevada company -- owned a 30.4 percent interest in Republic, according to court records.
Unkefer claims he's been paying taxes on his 30-percent share for the last three years, yet received no cash from Republic to offset those expenses. He believes Clark had been paying himself regular profit distributions from Republic Monetary while withholding such payments from Unkefer, records state.
Unkefer's demanding that an independent company audit the firm.
The lawsuit claims that an operating agreement between Occidental and Republic Monetary allowed Unkefer to inspect any financial record of Republic's at any time, and also inspect federal tax returns.
"Clark failed to provide adequate accounting of Republic and worked to undermine the interests of Occidental," Unkefer/Occidental's lawsuit states.
Unkefer's local attorney, Mark Sahl, didn't return repeated calls requesting comment. Clark didn't return a call, either.
Jakubczyk maintains that the Occidental link muddies the role of Unkefer in Republic Monetary.
The money invested by Unkefer in Republic Monetary has been set aside in an escrow account and "should be returned" to Occidental, Jakubczyk says.
But if that's what happens, it seems a might unfair to Unkefer. His investment helped start the company, so it stands to reason that he should be entitled to some returns on that investment.
And if he's managed to increase his original $200,000-plus investment substantially, that could be great news for his financial victims, who have been waiting more than two decades for some kind of payback.
In other words, Clark and Unkefer's gold fever might result in justice for some of Unkefer's victims.
The people who are owed Clark's unpaid restitution, though, are still screwed.
UPDATE: Clark got back to us a few days after this was published, saying he was out of town and didn't get our message. The CEO says he still considers Unkefer a "close, personal friend," and that his problem is with Occidental Resources, not Unkefer.
He says he thought Occidental was merely Unkefer's "personal company" when Unkefer made the investments to Republic Monetary, and he later came to find out that Unkefer wasn't in control of Occidental. However, since Occidental is the company that helps manage the trust of Unkefer's deceased wife, and Unkefer once claimed to be general manager of that company, the whole thing gets too convoluted for our simple mind.
Clark claims he didn't take much notice three years ago that Unkefer's investment came in the form of personal checks -- a claim we find difficult to believe. Clearly, Unkefer and Clark -- friends or not -- will be battling each other in court over these money matters.