ZION.US
id: 540
Zions Bank $2.5M Silver Pool Investors Settlement
D. Utah
Court2:19-cv-00015-HCN-DBP
Case number13 Jan 2000
Class period Start13 Jan 2023
Class period End10 Mar 2023
Claim deadlineZions Bank has agreed to pay $2.5 million to settle claims that it aided and abetted the fraudulent Silver Pool Ponzi scheme run by Gaylen Rust through Rust Rare Coin, Inc. Investors in the Silver Pool alleged that Zions Bank played a critical role in the scheme by processing transactions and failing to act on evident signs of fraud.
Outline
The case against Zions Bank arose after it was discovered that the bank supported Rust’s fraudulent activities by allowing transactions through Rust Rare Coin’s accounts despite clear signs of financial misconduct. Investors claimed that Rust used Zions Bank to facilitate his Ponzi scheme, leading to their financial losses. After the collapse of Rust’s Silver Pool, investors filed a class-action lawsuit, and Zions Bank has now agreed to settle the claims for $2.5 million.
Timeline
- January 13, 2000: The class period begins, marking the date when Rust’s fraudulent activity with Silver Pool investments began.
- January 8, 2019: Plaintiffs file the class-action lawsuit against Zions Bank for its role in abetting Rust’s Ponzi scheme.
- Nov 2022: Zion agreed to a $2.5M settlement with silver pool investors
Background
Rust Rare Coin, through its Silver Pool, operated a Ponzi scheme that misappropriated over $200 million from investors. Rust claimed that the Silver Pool was backed by actual silver holdings and that investors would receive consistent profits from his silver trading operations. However, no actual silver trading occurred. Instead, the scheme relied on new investments to pay earlier investors.
Zions Bank was the primary institution handling Rust’s financial accounts, and processing deposits and transfers related to the Silver Pool. Despite numerous warning signs, such as irregular account activities, overdrafts, and large volumes of suspicious wire transfers, Zions failed to act. The lawsuit argued that Zions Bank either knew or should have known about the fraudulent scheme but continued supporting it by facilitating financial transactions, thus enabling Rust to defraud investors.
The SEC and the CFTC exposed the Ponzi scheme in 2018, after which investors pursued legal action against Zions for its role in aiding Rust. The plaintiffs in the class-action lawsuit included Travis Gregory, Nicole Gregory, Alan Lambert, and Robert Baker, who represented a broader group of defrauded investors.
What Investors Should Expect
Investors who suffered financial losses due to Rust’s Silver Pool scheme may be eligible for compensation from the $2.5 million settlement.
If you were damaged due to this situation, you can file for a payout and get your share of the settlement. You can check if you are eligible and other details in the FAQ section below.
Case Status
Disbursed
Alleged Offence
Other
Suspected Party
Other
Security Type
Unit (ETF, ETN, Unit)
Trade Direction
Long
Filing date
08 January 2019
Plaintiffs
s Travis Gregory, Nicole Gregory, Alan Lambert, Robert Baker
Attorneys
ROSCA SCARLATO, LLC
Judge
Hon. Howard C. Nielson
Administrator
Strategic Claims Services
Settlement agreement date
2022-11-22
Court hearing date
24 April 2023
Exclusion deadline
03 April 2023
Objection deadline
03 April 2023
Hearing deadline
03 April 2023
Settlement conditions
Silver Pool Investors
Trades matching type
FIFO
+$2,500,000
Cash Settlement Amount