Museum Fraud Case Features Firearms From Custer, Buffalo Bill
Sunday, December 2nd 2007, 2:30 pm
By: News On 6
LOUISVILLE, Ky. (AP) The evidence will look like a prop list from a John Wayne movie when three antique gun enthusiasts go on trial on Monday on charges of bilking a millionaire collector.
Buffalo Bill's Winchester rifle. A pair of Colt six-shooters owned by General George Custer. Geronimo's bow and arrows.
The collector, Owsley Brown Frazier, a well-known Louisville philanthropist, spent millions acquiring the antique arms and displaying in a downtown museum that he opened in 2004.
But federal authorities say Frazier grossly overpaid for the weapons, thanks to an alleged scam hatched by the man he entrusted to find the famous firearms and run the museum.
Prosecutors estimate that Michael K. Salisbury and his wife, Karen Salisbury, turned a profit of at least $1.75 million from 1997 to 2002 by giving Frazier false appraisals.
The Alabama collector and his wife were indicted by a federal grand jury in March 2006 on several counts of fraud, money laundering and tax evasion.
The grand jury also named R.L. Wilson, one of the world's leading authorities on antique firearms, who appraised the weapons at inflated prices, federal officials said. Wilson, who describes himself on his Web site as ``the most published author in the history of arms collecting,'' faces several counts of fraud.
It was not clear how Wilson would have profited from the transactions. Eric Long, the chief prosecutor in the case, declined to comment.
Attorneys for the Salisburys say Frazier had struck an agreement with them to pay higher prices as commission for Salisbury's work in finding the weapons.
``It boils down to one thing: Did Mr. Frazier agree that Mike would get commission for these guns?'' said Gregg Hovious, Michael Salisbury's attorney. ``That's what it's about.''
Calls to Wilson's San Francisco apartment were not answered, and his attorney declined to comment. In court records, Wilson denied the allegations and said he looked ``forward to vigorously defending myself in a court of law.''
Prosecutors say Salisbury's mark-ups sometimes doubled the price he had paid. In one 2000 purchase cited in court records, Frazier bought a Henry repeating rifle from Salisbury for $135,000, though Salisbury had acquired it for just $31,000. Salisbury bought the Custer pistols for $235,000 and sold them to Frazier for $300,000, according to the indictment.
Frazier met the Salisburys through a mutual friend in 1997 when he was a novice collector and eventually ``grew to view them as close personal friends,'' according to court records. Frazier named Michael Salisbury president of the Frazier Historical Museum in 2001, paying him a $100,000 annual salary.
Frazier also had a close relationship with Wilson, who declared bankruptcy in 2001 and recently served a year in a California prison for a conviction in an unrelated fraud case.
The Louisville museum houses several ancient and historical weapons, including Teddy Roosevelt's ``Big Stick,'' a 19th century Holland and Holland rifle. It also has the only permanent U.S. collection from the Royal Armouries, Britain's national repository for arms and armor, which Wilson reportedly helped Frazier acquire.
Frazier, great-grandson of the founder of Louisville liquor giant Brown-Forman, sued the couple and Wilson in April 2004, making similar allegations of fraud. That suit has been put on hold until the criminal proceedings are completed.
Just before Salisbury was named museum president, Hovious said, he and Frazier drew up a document that said Salisbury would receive commissions for finding antique weapons.
Frazier has testified that he wanted to keep his dealings with Salisbury secret from the museum's board because the purchases were funded out of his own pocket. Frazier also said the agreement with Salisbury was not a binding contract.
It was not until 2002 that Frazier and the museum's foundation ``began to comprehend the wrongdoing by Salisbury,'' Frazier's civil suit said.
In a countersuit filed by the Salisburys and Wilson last year, attorneys argued that Salisbury would not have devoted four years of his life to tracking down hard-to-find antique firearms without being compensated.
Both Salisburys face up to 20 years in prison if convicted; Wilson could be sentenced to up to 5 years.