By Dan Moffett

Palm Beach Post Editorial Writer

Sunday, February 10, 2008

There are some brainstorms that are so massive and intense that they fall beyond the outer reaches of the Saffir-Simpson Scale.

Certainly the mental picture that Henry "Skip" Clements had 10 years ago was enough to keep any entrepreneur up at night. Imagine this: 1.2 billion Chinese waking up every morning with a glass of Florida orange juice.
That's billion with a "b," glasses with an "OJ" and amazing fortunes with a huge "$" for whomever could deliver the goods.

That could have been Mr. Clements. It really could have. He ran a citrus export business in Stuart and made big news in 1998 when he struck an exclusive deal with the Chinese government to put juice and fruit on all those breakfast tables from Beijing to Shiquanhe.

But few brainstorms have petered out uglier and nastier than this one.

A couple of thousand investors ended up getting burned and lost millions in a pump-and-dump stock scheme, only a few shipments of citrus ever made it to China, Mr. Clements lost everything he had and a half-dozen government lawyers have spent a decade trying to unravel the mess.

On Monday, after two years of failed appeals, Donald Mintmire is scheduled to report to the Federal Correctional Institution in Miami to begin serving a 21-month prison sentence for his part in the scam.

Mintmire, 61, was once a highly regarded Palm Beach lawyer with a stable of well-heeled clients. His name holds a place in West Palm Beach history for a deal brokered in 1991 which became known as the Mintmire Agreement. The attorney was a trustee for the Downtown/Uptown renewal project that paved the way for CityPlace. In 1995, Mintmire got involved in a legal squabble over the naming rights for Au Bar, the Palm Beach nightclub made famous by the William Kennedy Smith court case.

His role in Mr. Clements' citrus venture will not be fondly remembered. A federal jury in Miami convicted Mintmire of obstruction of justice and conspiracy in 2005. Mintmire was the brains behind the disastrous brainstorm.

According to prosecutors and the U.S. Securities and Exchange Commission, Mintmire made at least $705,000 and created a bogus shell company that became the vehicle for the scam. How he did it surprised even seasoned investigators. Mintmire had his son round up 26 friends at an Atlanta bar and paid them each $100 to $200 to sign fraudulent documents that gave the attorney control of the public company called Clements Golden Phoenix.

In 2000, company stock soared from $2 a share to $14 and then split as word of the citrus deal with China hit Wall Street. But within three months it crashed to nothing and considerably more than $15 million pretty much vanished into thin air, as did several of the company's board members. Only Mintmire has been charged. Joseph Rizutti, owner of Beacon Accounting in Palm City, was the firm's chief financial officer; his friend, Nick Salerno, a Fort Myers securities dealer, helped put together the public offering.

Mr. Clements, the CEO, was astonished to learn that - while he was out trying to sell citrus - the company that bore his name had become worthless. He went to federal investigators and told his story. It is some satisfaction to Mr. Clements that the evidence he provided helped get Mintmire disbarred (the Florida Bar gave Mr. Clements a check for $22,500 as compensation for the lawyer's unethical behavior) and sent him to prison. But the losses are great.

"I lost my car, my boat, my house," Mr. Clements, 56, says. "I was embarrassed and humiliated. My kids were taunted at school. Banks wouldn't talk to me, and friends disappeared. But I wasn't going to run."

Federal prosecutors have been slow to do the work that needs to be done on this case. They know Mr. Clements has no money, and they believe Mintmire's take was less than a million.

So then, the questions for U.S. Attorney R. Alexander Acosta are: Who took the other $15 million? And when will the government charge them for their crimes?

Besides Mr. Clements, about 2,000 small investors would like to have the answers.

Source: http://www.palmbeachpost.com/opinion/content/opinion/epaper/2008/02/10/m2e_moffettcol_0210.html