updated 1/3/2007 4:50:06 AM ET 2007-01-03T09:50:06

In a May 17, 2006, deposition taken by federal attorneys, Richard S. Kern said he was mired in debt with zero assets and scant hopes of paying the more than $9 million he owes the U.S. Securities and Exchange Commission. He said he had no business interests outside of being a small-time real estate agent and hustling vitamin products in multilevel marketing schemes. Here are some of the things he said under oath:

  • “I have lots of (bill) collectors pursuing me.”
  • “I don’t own a car. I borrow my neighbor’s car a lot.”
  • “I’m averaging about $50,000 (income) in the last couple of years. … maybe a little bit less than that, 40-something.”

But before and after his deposition, Kern and his associates granted interviews, issued press releases and used Web sites to characterize the former stock scam participant as a sophisticated international developer.

  • “We build with long-term sustainability of the community in mind and create buildings and communities that will protect both the emotional and physical health of our residents.” —  Kern as quoted on Paradise Properties Web site, April 6, 2006
  • “International developer Paradise Properties Group announced last week that Director Richard Kern has been chosen to receive special recognition for the company’s efforts in supporting the rebuilding and revitalization of the storm-ravaged Gulf Coast Region.”Sea Coast Echo, May 10, 2006
  • “I have developed a myriad of projects over the years … a myriad of restaurants and strip centers in Arizona” and “a really big project in Russia.”Kern in June 26, 2006, interview with

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