FFCF Investors, LLC, Ascendus Capital Management, LLC, and Smith Holdings, LLC.
PO Box 1836, Salt Lake City, UT 84110, (801) 824-9616

Updates and Descriptions of Recent Developments

February 25, 2015: The Court entered an order authorizing the receiver to make a limited distribution to investors who assigned their claims against Penson Financial Services to the Receivership Estate. The order also closes the Receivership Estate. The Receiver regrets that the bankruptcy of Penson prevented him from recovering additional funds that could have been paid to victims of this fraud, but he has exhausted the potential for further recoveries in this case. A copy of the court’s order can be found here.

January 29, 2015: The Receiver filed a motion today recommending that the FFCF/Ascendus Receivership be terminated. The Receiver provided a status report summarizing developments in the case since May 2010. The motion asks court approval to make limited distributions to investors who assigned their claims against Penson to the Receiver and to enter an order dealing with termination of the estate. A copy of the status report and memorandum in support of the motion can be found here.

June 6, 2013: In the Penson bankruptcy case, a plan of liquidation and disclosure statement describing the liquidation plan have been filed by Penson. The Receiver intends to submit a vote in favor of the proposed liquidation plan. It will be several years before any funds might be available for distribution from the bankruptcy estate. At that point, the Receiver will still need to prove the legitimacy of the claims he has asserted.

February 4, 2013: A copy of the bankruptcy notice filed by Penson Financial Services on January 11, 2013 can be found here.

February 1, 2013: A letter was received today from the Financial Regulatory Authority notifying the Receiver that the arbitration proceeding would be dismissed due to Penson’s bankruptcy. A copy of the letter can be found here. Penson’s bankruptcy attorneys have also filed a notice of the bankruptcy filing with the state court. That means the arbitration proceeding will be dismissed and the court case will both be put on hold. The Receiver is investigating the wisdom of filing a claim in the bankruptcy proceeding.

January 11, 2013: The Wall Street Journal reports that Penson filed for bankruptcy on Friday, January 11. That story can be found here. The news story said the bankruptcy filing is a Chapter 11 reorganization, but the company apparently has ceased operations and plans to liquidate its assets. In the meanwhile, bankruptcy laws prohibit us from proceeding with our litigation or the arbitration while the company is in bankruptcy. We are pursuing options, including making a claim in the bankruptcy proceeding. Here is a link to another news story about the bankruptcy.

November 13, 2012: The Court today entered a judgment against Richard Smith for $3,228,491.89. This judgment was entered by default, after Mr. Smith failed to appear and defend himself in the Receiver’s lawsuit. The Court did hold an evidentiary hearing September 24, 2012 at which time the Court took testimony on the amount of damages. A copy of the judgment can be found here. The findings of fact and conclusions of law issued by the Court in connection with the judgment can be found here.

October 29, 2012: The court today issued a ruling in the lawsuit that the Receiver filed against Capital One Bank, seeking a return of credit card payments made by Ascendus on Richard Smith’s credit card. The judge’s order said that the receiver’s claims for fraudulent transfer were beyond the statute of limitations and he dismissed those allegations. The order says that the receiver’s claims for unjust enrichment are valid and can proceed. A copy of the ruling can be found here.

September 10, 2012: Penson filed its answer today in the arbitration action brought by the Receiver. Not surprisingly, Penson denies any responsibility. A copy of Penson’s answer can be found here.

July 11, 2012: The Receiver today filed an arbitration claim against Penson Financial Services. The arbitration proceedings will be with FINRA, the organization that oversees disputes against brokerage firms. A copy of the “statement of claim” can be found here.

June 12, 2012: The court today issued its ruling on Penson’s motion to dismiss the Receiver’s lawsuit against it. Penson had asked the court to dismiss the lawsuit based on allegations the Receiver lacked standing to assert claims against Penson, the Receiver’s claims were barred by Taylor’s and Smith’s complicity in the wrongdoing, and that the statute of limitations had expired. The court denied Penson’s motion, affirming the Receiver’s authority to proceed with the lawsuit. A copy of the opinion can be read here. This is the latest in a series of vigorous efforts by Penson to prevent the Receiver from proceeding with the litigation. The case will now move forward with some claims proceeding in court and some claims proceeding in arbitration.

March 29, 2012: The Receiver today filed his brief in opposition to Penson’s motion to dismiss the Receiver’s lawsuit against it. The court has set a hearing on this matter for April 12, 2012.


Welcome to the Klein & Associates website! This page contains information regarding the Receivership of FFCF Investors, LLC, Ascendus Capital Management, LLC and Smith Holdings, LLC. On this page, you will find:

  • Copies of the Court Order Appointing a Receiver and other Court filings about the Receivership;
  • Copies of Status Reports and other notices the Receiver has filed with the Court;
  • Copies of lawsuits filed by the Receiver seeking to recover funds;
  • Information relating to tax treatment of Ponzi scheme losses; and
  • General information about the Receivership.

Click Here For FFCF Claim Form

***Filing Deadline: April 30, 2010***


1. Order Appointing Receiver and Litigation Against the Receiver

2. Status Reports to the Court

3. Motions Filed by Receiver in Receivership Lawsuit

4. Receiver Lawsuit against Penson

5. Other Lawsuits Filed by the Receiver

6. Court Notices Regarding Settlements

7. Filings Relating To The Claims Process

8. Other Receivership Filings with the Court

9. Criminal Filings with the Court



Dear Investor:

On March 17, 2009 the IRS announced significant tax relief for victims of Ponzi schemes.  The ability to take tax deductions for past years and future years has been greatly expanded.  I have added information here that will help you understand the new tax relief and that your accountants and tax advisors can use in determining how to deduct losses from this scheme.

  1. Article from March 18 2009 Wall Street Journal
  2. IRS Revenue Ruling 09-09
  3. IRS Revenue Procedure 09-20
  4. Testimony To Congress By A Top IRS Official Explaining the New Tax Relief Procedures

This information is being posted for investor information.  The Receiver has no opinion on how individual investors treat their investment for tax purposes.  Investors are urged to contact their own tax professionals for advice on tax treatment of their situation.


The attached form is designed to help the Receiver understand what claims might be made against FFCF, Ascendus, and Smith Holdings, including what amounts were given to them by investors.  Please complete and submit this form by clicking on the following link:

Investor Preliminary Questionnaire


On March 18, 2009, Wayne Klein was appointed as Receiver for:

  1. FFCF Investors, LLC,
  2. Ascendus Capital Management, LLC, and
  3. Smith Holdings, LLC.

The appointment was made by Utah Third District Judge Denise P. Lindberg in connection with litigation filed against these companies and their managers.  The Receiver is providing the following information that may be helpful to investors regarding the FFCF, Ascendus, and Smith Holdings Receivership:

What is a Receiver? A Receiver is a person appointed by a court to take control of companies or assets.  This prevents any dissipation or misuse of the assets and begins the process that hopefully will lead to recovering money that can be used to pay investors and other creditors.  As the Receiver, I am an officer of the court.  It is my duty to gather and protect the assets of FFCF, Ascendus, and Smith Holdings.  I am experienced in analyzing investment programs, having served as Director of the Utah Division of Securities, Chief of the Utah Attorney General’s Commercial Enforcement Division, and Chief of the Idaho Securities Bureau. I do not work for any of the parties in the lawsuits that have been filed.

What will the Receiver do now? The immediate tasks for the Receiver are: 1) locating the assets and records of the companies and transferring them to my control, 2) conducting an analysis of the company’s operations to determine where the funds were expended and determining what claims, if any, the company may have against third parties to recover more funds, 3) recovering any deposits in brokerage or bank accounts, 4) seeking to recover any improper payments made to others, 5) selling any assets of the company, and 6) recommending to the Court a plan to distribute funds the Receiver is able to recover.  The Receiver expects to be able to take advantage of work already done in gathering and analyzing information.

When can I get my money back?  How much? It is too early to say how much, if any money the Receiver will be able to locate and recover.  The Receiver will analyze the records of the company, including bank records, and identify where assets might be.  The Receiver will then seek to recover those assets.  The Receiver also must evaluate claims against the company, such as investor claims.  It will likely take several months to completely gather and evaluate this information.  It is not possible to determine, at this early date, what funds, if any, will be located and returned.

How can I keep informed about what the Receiver is doing? The Receiver must file regular progress reports with the court.  Those reports are public information and will be shared with investors.  The Receiver will post these reports, copies of court filings, and other information about the receivership on its web site: Investors are encouraged to check the web site for updated information.

How do the Receiver and his staff get paid? We are paid out of assets of the estate, generally from monies we recover.  All payments must be approved by the Court.

What information will the Receiver want from me? The Receiver will be sending investors a form requesting information about your investments and asking for copies of documents you received from the company.  If there is information you think the Receiver should know now, before he finishes his preliminary review of records of the company, you can send them to the Receiver at: Wayne Klein, Receiver for FFCF, Ascendus, and Smith Holdings, 10 Exchange Place, Suite 502, Salt Lake City, UT 84111.  The Receiver can be contacted at (801) 534-4455 or via e-mail at


Wayne Klein
PO Box 1836
Salt Lake City, UT 84110
Telephone: (801) 824-9616
James D. Gilson (5472)
Zachary T. Shields (6031)
Callister Nebeker & McCullough
Attorney for A. David Barnes
Zions Bank Building Suite 900
10 East South Temple
Salt Lake City, UT 84133
Telephone: (801) 530-7300
Facsimile: (801) 364-9127
Erik A. Christiansen (7372)
Parsons Behle & Latimer
Attorney for Albert Wirth
One Utah Center
201 South Main Street, Suite 1800
Post Office Box 45898
Salt Lake City, UT 84145-0898
Telephone: (801) 532-1234
Facsimile: (801) 536-6111
Jonathen O. Hafen (6096)
Matthew J. Ball (9414)
Parr Brown Gee & Loveless
Attorney for Annette Kay Donnell
185 South State Street, Suite 800
Salt Lake City, UT 84111
Telephone: (801) 532-7840
Bruce L. Dibb (0879)
Jensen, Duffin, & Dibb, LLP
Attorney for Plaintiff Lighted Candle Society
311 South State Street, Suite 380
Salt Lake City, UT 84111
Telephone: (801) 531-6600
Facsimile:  (801) 521-3731