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CHICAGO - After decades of litigation over his claims of miracle schemes to lose weight or gain wealth— and more than eight years in federal prison — TV pitchman Kevin Trudeau still has fans willing to give him millions of dollars.
The Kevin Trudeau Fan Club, founded by devoted followers to route money onto Trudeau’s commissary account while he was serving a federal prison sentence for making fraudulent claims in infomercials, has raised approximately $3 million, according to testimony this week at hearings aimed at learning whether Trudeau is hiding still more millions he could be using to pay off a $37 million fine levied by the Federal Trade Commission more than a decade ago.
Lawyers for the FTC allege Trudeau has hidden gold bars and other assets from the government and raised questions about donors who have made five-figure donations to support Trudeau’s legal defense and living expenses — which included a $750 dinner at Michelin-starred Alinea.
Testifying by remote video from her home in Texas on Wednesday, fan club co-owner and retired schoolteacher Tonya Canada testified she collects $5,000 per month to manage the club, with the proceeds doled out to Trudeau upon request.
Trudeau "has, probably millions, hundreds of thousands of fans around the world who love his teachings," Canada said.
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Of the $3 million raised, only a little more than $1 million has gone to pay the FTC, commission lawyer Jonathan Cohen noted, while Trudeau has directed Canada to make $7,500 payments to "volunteers" who help maintain his website and also to a woman Cohen identified as Trudeau’s girlfriend.
Cohen also noted that the fan club website until recently was selling a "Tesla" device, with claims that it would lower blood pressure and blood sugar, reduce inflammation and increase circulation — all health benefits Trudeau himself is barred by the court from promoting. The club counted several donors who had made multiple five-figure gifts, Cohen noted.
"It’s true you did nothing at all to … determine the source of those funds," Cohen asked.
"Right," Canada said. "We just accepted the contributions."
The hearings this week are a continuation of court proceedings that were interrupted in 2014 by Trudeau’s prison sentence in a separate case for violating terms of a 2003 settlement with the FTC over bogus claims made in his best-selling diet book "Weight Loss Secrets ‘They’ Don’t Want You To Know."
On Tuesday, a forensic investigator hired by Trudeau detailed an investigation that cost more than $200,000 to Trudeau’s bank accounts and corporations. FTC lawyer Cohen questioned whether that investigation, which targeted Trudeau’s known accounts and a search of Trudeau’s properties, was sufficient to determine whether Trudeau was hiding assets in other accounts or shell companies. Trudeau’s ex-wife earlier this year testified that Trudeau had gold bars hidden around their house, and he had filled a duffel bag with gold bars before making a trip to Guatemala.
"Did you look under [Trudeau’s] bed?" during a search of Trudeau’s home, Cohen asked Kroll forensic investigator Ryan Pisarek, who said his investigators had looked for hollow walls and hidden safes.
"I did not," said Pisarek, who later repeatedly invoked his Fifth Amendment right against incriminating himself when Cohen asked him questions about how an employee apparently used Trudeau’s wife’s Social Security number to access her financial accounts.
At the close of the hearing Wednesday, Judge Robert Gettleman appearing weary after nearly two decades of litigation in Trudeau’s case, snapped at Trudeau’s lawyer, Giel Stein, when Stein complained the FTC was drawing out the process.
"Let’s go back to the source," Gettleman said. "It was caused by [Trudeau’s] continued contemptuous conduct in this court. I don’t know how many times I’ve held him in contempt. He went to jail for it. Don’t blame the FTC."
Trudeau is set to be the featured speaker at a Boston event hosted by Global Information Network, the company he founded but that was later purchased by associates, and which now counts him as a salaried employee — eligible for bonuses if the business is successful, Stein told the judge, who had previously approved Trudeau’s out-of-state trip.
"The sad fact about all this is, had he been hard at work, Mr. Trudeau could have been doing what he does best," Stein said. "He would have been able to pay off whatever was owed in a matter of a year or a year and a half."