Pennsylvania Superior Court Forced To Intervene In Fallout From A Prominent Former Politician’s Participation In A Multi-Million-Dollar Advance-Fee Scam
September 11, 2023
By: Carl L. Engel
The Pennsylvania Superior Court was forced to intervene in the aftermath of an advance-fee scam (also known as a “Nigerian prince scam”) involving a former United States Congressman and the majority shareholder of a local television station. After the pair lost millions of dollars to a couple of Ghanaian bankers, a receiver was appointed to seize the television station and distribute its assets to creditors. The Superior Court held that the trial court could order the transfer of the physical assets, but the broadcasting license had to be transferred in a separate proceeding with the FCC. More than anything, this case illustrates how even prominent politicians and successful business owners can fall victim to a commonly known scam.
Curt Weldon is a former United States Congressman who represented Pennsylvania’s 7th district from 1987 to 2007, when it was mostly comprised of portions of Delaware and Chester counties. Richard Glanton is the largest shareholder of Philadelphia Television Network, Inc. (“Philly TV”), which has an FCC license to broadcast several channels in the region, and operates stations that air community-affairs programs, infomercials, and B-movies.
In 2015, Congressman Weldon approached Mr. Glanton about the chance to manage a former Libyan oil minister’s $350 million wealth fund. After several months, Mr. Glanton informed Congressman Weldon that he thought the deal was legitimate, and suggested that they travel to Ghana, where the minister would turn over the funds. Upon arriving in Ghana, Mr. Glanton and Congressman Weldon met with the minister’s representative, Kweku Amedume Thorpe. Mr. Thorpe informed them that the funds were being held by a company called Standard Express Security under the supervision of the Ghanaian Interior Ministry. He also told them that, to release the funds, they would need to wire approximately $45,000 in “late storage fees” to Standard Express Security, which they agreed to do.
After wiring the money, Congressman Weldon, Mr. Glanton, Mr. Thorpe, and several others, including a banker named Chris Obareki, met at the offices of Standard Express Security to inspect three boxes of hundred-dollar bills. The money was taken to a bank called ECO Bank, which confirmed that the money was real and totaled $360 million. However, ECO Bank informed them that “each of the bills had an invisible insignia in Arabic that would need to be removed before the funds could be deposited.” The removal process would cost $2.4 million up front, with Mr. Thorpe and Mr. Obareki contributing $900,000 and Congressman Weldon and Mr. Glanton contributing the other $1.5 million.
After Congressman Weldon and Mr. Glanton paid the $1.5 million, Mr. Thorpe and Mr. Obareki informed them that the Central Bank of Ghana had seized the $360 million, and were requiring payment of a $3.6 million fine to release the money. Mr. Thorpe and Mr. Obareki said that if Congressman Weldon and Mr. Glanton paid $800,000 toward the fine, they would pay the remainder. When Mr. Thorpe and Mr. Obareki didn't provide any money of their own, Congressman Weldon and Mr. Glanton contributed additional funds toward the fine. Ultimately, Mr. Thorpe and Mr. Obareki reneged on the deal, and Congressman Weldon and Mr. Glanton don’t know what happened to all the money they contributed.
To obtain funds to pay the Ghanaian bankers, Congressman Weldon and Mr. Glanton had obtained loans from Brian Roche and his affiliate, Luxury Asset Lending. By June 2017, Congressman Weldon and Mr. Glanton had defaulted on loans totaling $490,000. Mr. Roche and Luxury Asset Lending agreed to lend them another $40,000, if Congressman Weldon and Mr. Glanton agreed to pay back an additional $3.3 million. They agreed. Without informing anyone at Philly TV, Mr. Glanton obligated it on the loan and pledged its assets as collateral.
After Congressman Weldon and Mr. Glanton defaulted on the loans, Luxury Asset Lending filed a lawsuit in California against them and Philly TV seeking $3.9 million in damages. Mr. Glanton and Philly TV did not respond to the complaint, and a default judgment was entered against them in the amount of $3,897,919.22. Congressman Weldon and Luxury Asset Lending agreed to take their dispute to private arbitration.
On July 13, 2017, Mr. Glanton filed for Chapter 11 bankruptcy protection, but soon thereafter filed a motion to allow for the voluntary dismissal of his case because he had reached a settlement with Luxury Asset Lending. Luxury Asset Lending transferred its default judgments against Mr. Glanton and Philly TV to another company owned by Mr. Roche, called Newport Investment Group, LLC (“Newport”). On April 30, 2018, Newport filed an order in the California lawsuit whereby Mr. Glanton agreed to transfer his shares in Philly TV and control of the company and its assets, including its FCC broadcast license, to Newport.
On May 4, 2018, Newport filed an action in Philadelphia County to transfer the judgment to where Philly TV and its assets are located. On May 11, 2018, the trial court entered an order directing Mr. Glanton to transfer his shares in Philly TV to Newport, along with control of the company and its assets. On June 5, 2018, Philly TV filed a request with the FCC to dismiss the order on the grounds that Mr. Glanton did not have authority to assign the license. The FCC granted the request to block the transfer, but stated that if a court-appointed receiver authorized a sale of the license, the FCC could approve the transfer.
On November 19, 2018, Newport filed an emergency petition for the appointment of a receiver to take control of Philly TV. That same day, the trial court granted the petition without a hearing and appointed Joseph Bernstein as receiver. Mr. Bernstein immediately filed an application with the FCC to transfer Philly TV’s broadcasting license to Newport, which the FCC granted on November 28, 2018. Philly TV then filed a motion to open the judgment against it and vacate the receivership appointment. The trial court denied these requests, but agreed to stay the case pending a review by the Superior Court. Philly TV and Newport both appealed.
On May 24, 2019, the Superior Court remanded the case back to the trial court, asking it to reconsider its appointment of the receiver. On October 24, 2019, the trial court struck the receivership, finding that the FCC prohibits the use of temporary receiverships to foreclose on broadcasting licenses. On June 23, 2021, the trial court struck the judgment against Philly TV. On May 19, 2022, Philly TV filed a motion to enforce the orders striking the receivership and judgment, and to compel the return of its assets, including the FCC license. The court denied Philly TV’s motion, finding that only the FCC had the authority to order Mr. Bernstein to return the broadcasting license. Philly TV appealed a second time.
On September 7, 2023, the Superior Court affirmed the trial court as to the broadcasting license, but reversed as to Philly TV’s physical assets. In reaching its decision, the Superior Court found that the FCC has exclusive “unified jurisdiction and regulatory power over all forms of electrical communication, whether by telephone, telegraph, cable, or radio.” Therefore, only the FCC has the authority to approve the transfer of a broadcast license. However, the Superior Court found that the FCC’s jurisdiction did not extend to Philly TV’s physical assets, such as its broadcast tower. Therefore, the trial court had the authority to order the return of Philly TV’s physical assets.
Even successful people, such as business owners and former politicians, can fall victim to an advance-fee scam. Here, Congressman Weldon and Mr. Glanton were hooked as soon as they paid the first $45,000 advance fee for “late storage.” After that payment, their egos clouded their judgment as they refused to acknowledge that they had been scammed out of this relatively small amount, and instead spent and borrowed millions more dollars to convince themselves that there really was a pot of gold at the end of the rainbow. A great amount of pain could have been avoided had they simply admitted a mistake and swallowed the initial loss.