Episode 86

Weaponization of DOJ Isn't New: The Untold Story of Stephen Keller

Hosted by Matt Adams and Stephen Keller

“My heart dropped to my feet. And the life just left me, and I knew that at that time we were done. I knew whatever this was, it's not good... After that, the whole demeanor of the judge changed. Anything my attorneys asked for, they were not granted... There was absolutely no due process from that meeting on for me."

Weaponization of the criminal justice system was happening long before it had a name.

That's what Stephen Keller posits in his book, Pay to Play: Political Corruption, Corporate Greed, and the Cost of the American Dream.

In the late 1990s, Stephen was living every entrepreneur's dream. In his late twenties, he entered the viatical settlement market and went on to essentially create the life settlement industry, which today moves $30 billion annually.

But as Stephen's company became the largest player — and disruptor — in the sector, he found himself walking around with a target on his back. A specific, well-resourced insurance company, threatened by his business model, allegedly orchestrated a coordinated effort with federal authorities to bring him down.

In this powerful episode of "The Presumption of Innocence," host Matt Adams sits down with Stephen to discuss the alleged takedown, the pay-to-play political system he encountered while seeking relief, the life-altering moment when the U.S. Attorney General inexplicably arrived at his federal trial to meet privately with the judge, and his ceaseless attempts to clear his name during the nine years he spent in prison.

This is an episode you won't want to miss.

The views expressed in this podcast are those of the participants and should not be considered the views of Fox Rothschild LLP or its attorneys. This podcast is for informational purposes only, is not legal advice, and does not create an attorney-client relationship.

Presumption of Innocence Ep 86 (Matt Adams & Stephen Keller)

===

Speaker: The views expressed in this podcast are those of the participants and should not be considered the views of Fox Rothschild LLP or its attorneys. This podcast is for informational purposes only, is not legal advice, and does not create an attorney-client relationship

Matt Adams: Welcome back to the Presumption of Innocence podcast, brought to you by the White Collar Criminal Defense & Government Investigations Practice at Fox Rothschild. I'm your host, Matt Adams. One of the most powerful tools that the government possesses is the ability to criminally investigate and prosecute.

The mere announcement of criminal charges or even an investigation can destroy reputations, cripple businesses, drain financial resources, and alter lives forever. And this happens even before a single charge is filed, and despite the presumption of innocence that all criminally accused are supposed to enjoy.

When used properly, these powers can protect the public and uphold the rule of law. But when investigations become overzealous, politically motivated, or disconnected from the underlying facts, the criminal justice system itself can become a weapon. The weaponization of the criminal justice system, particularly in the business and political context, has been in the news a lot lately.

Both sides of the ideological spectrum have claimed that the power to prosecute has been misused and abused to p- persecute rather than bring about honest justice. Today, we're exploring a question that has become increasingly relevant in our public discourse. When does aggressive law enforcement cross the line into the weaponization of investigations and prosecutions?

His case generated significant attention, raised questions about prosecutorial discretion, and sparked an entire debate about the devastating personal and professional consequences that can result when the government sets its sights on an individual or business. Years after a lengthy prison sentence, he's written a new book, and it's a great one, _Pay to Play: Political Corruption, Corporate Greed, and the Cost of the American Dream._

It's fresh off the presses, and it's a memoir. In this conversation today, we're going to discuss the realities of being investigated by the federal government, the pressures that defendants face long before a trial ever begins, the role of prosecutors in shaping outcomes, and what lessons can be learned about a balance of accountability and fairness.

We'll also examine the broader implications for entrepreneurs, business leaders, and ordinary citizens who may find themselves caught in the machinery of the criminal justice system. Stephen, we have a lot to unpack. Thank you for joining us, and welcome to "The Presumption of Innocence."

Stephen Keller: Well, thanks for having me here.

And you did a great job summarizing everything that I've experienced.

Matt Adams: So we do have so much to unpack that I'm going to have to take it systematically. I want to start educating our audience from the outset a little bit about the business you got into and why. And then we'll, we'll really jump into the heart of the investigation that thereafter ensued, and talk a lot about what you've detailed in the book.

But specifically, what's a viatical settlement market? How did you get into that business? And, tell us just educate us a little bit about the threshold core business that you were involved with.

Stephen Keller: Okay. So, back when I was around 27 years old, I worked for Dean Witter as a stockbroker. And one of my colleagues that was in my training class, he'd come to me and he said, "Steve," he goes, "Have you read about these people that are now afflicted with AIDS and they've created a market to sell their policies?

That they're selling their life insurance policies to get monies to pay for drugs that are non-FDA approved." He said, "What do you think about that?" And my first blush was this sounds morbid." And it wasn't long after that, that thought resonated in my head. And, when I had another client come to me and he had a water filtration system that goes into a grocery store.

You push a button and a paper carton comes down, and the water goes in it, it flame seals it, and you take it with you. I thought it was a great idea because it's not plastic. And he said, "But we've got a problem." I said, "What's the problem?" He said, "We've oversold our stock, and we're not through with R- R&D.

What can you do?" And I went back to, my colleague's Chris Conway's idea about the uh, the policy swap. And I thought, " Why don't I marry these two together?" I could see the great need in the viatical market that the people needed cash for their survival. So I married these two ideas together, and the company created bonds backed by the policies and raised cash they needed, and we started raising cash back for the viaticals.

So that's how Kelco got started, with that premise.

Matt Adams: And Kelco was your company that was involved in this viatical market?

Stephen Keller: Yes. Yes, it was.

Matt Adams: So-

I've got to, I've got to get this question out of the way, Stephen, right? Okay. From the outset.

Stephen Keller: Yeah.

Matt Adams: How did you reconcile that ethical tension, right?

You even said by your own acknowledgement that it was a little bit morbid. These were people that at the time in the late '90s, a diagnosis of AIDS was still a death sentence.

Stephen Keller: Right.

Matt Adams: This was a situation where terminally ill people were clinging to whatever they could to try to extend their lives, including liquidating these types of policies.

And so how did you, how'd you reconcile that ethical tension of trying to build a profitable business around terminally ill people? Because at the core of the ultimate criminal justice contact that you faced down the road related to your business-

Stephen Keller: Mm-hmm

Matt Adams: ... I think was that ethical tension. I think it was the government drawing a conclusion about the ethics of that business.

So, so let's hear it from your mouth. What was your ethical calculation that said, "Eh, it's okay. We can go into that business"?

Stephen Keller: After my colleague came to me with the idea of people selling their policies to raise cash, I sat with that and I understood that this was a huge need, that there was no insurance for non-FDA drugs, and it was a matter of life and death. And to provide a, such a service was invaluable.

It wasn't a business preying on anybody, it was a service provided for people that desperately needed it, and I could see that. And we did provide an invaluable service to thousands of people.

Matt Adams: In the book you describe the industry as having something like a 90% lapse rate, and that being a, quote-unquote, "dirty secret."

Can you explain that? Can you explain that business model and why it mattered to you as part of your moral justification for getting into that business?

Stephen Keller: Well, starting out, I really didn't realize that, and that's what disrupted the entire life insurance market, which I didn't set out to do.

But, our industry was a... It became a threat to the life insurance market, the life insurance companies. And, the way that they operate is they have a 98 to 99% lapse rate on life insurance policies. So they want you to take a policy out, pay for the premiums for 10 years, and they'll encourage you to lapse that by raising premiums at a certain point in time in your life to where it's non-beneficial for you anymore.

So, they enjoy all those premiums you pay all those years and then the policy lapses and they have, they don't have to pay out. So our business model enabled people to sell their policy. There's a secondary market that gives them a value for that. They get the cash up front, which is a discount to the face, and we pay the premiums, and we collect the death proceeds at the time of mortality.

And the insurance companies did not like that because it went totally against their business model.

Matt Adams: That's the American dream. Become a market disruptor, make a bunch of money doing it. It just so happened that there was people's lives behind it, so it had this kind of, for lack of a better phrase, icky feeling to some people that might be observing, no?

I mean, would you agree?

Stephen Keller: I think it's always been interesting to me that when we deal with death, that it becomes something icky. So like the funeral homes or, mortician market or whatever. But that's just the premise that the the mindset of the people have.

And this was dealing with the hard reality that, people were going to die. We're all going to die. So, it's not something that care to face day in, day out.

Matt Adams: Well, you ultimately built Kelco into a national company. You then began to expand your market beyond AIDS patients to seniors and other people with sort of their demise in sight.

I mean, describe for us how you built this enterprise. How did that expansion take place? And give us a little frame of reference in terms of the life cycle of the business, like how this idea took off.

Stephen Keller: We got involved with a handful of companies in the what's called the viatical market.

And the viatical market was terminally ill people that had been prognosed by a doctor to be five years or less. So I don't know if you remember or not, but at one point in time when the AIDS cocktails were introduced, a lot of businesses went out of business during that time because the people with AIDS, they no longer saw the need to sell their policies.

They thought that this was a cure and investors were not investing dollars into the market. So I began to research who else could use our services. And it wasn't like widgets, so we couldn't produce more product for our investors. And so, we were sitting with a problem, and we had too much cash and not enough product at the time.

And, that's back in the days when "Oprah" was on and everybody and their mom watched "Oprah."

Matt Adams: Daytime TV ...

Stephen Keller: The whole country shut down to watch "Oprah." So, and we just so happened to run that ad. Now, the original ad, when I started this ad, it was actually for the viatical side of the business.

In the middle of the ad, we had created the life settlement. And the ad was very expensive. It w- it was a million dollars, and I had to borrow the money. I leveraged myself out to the hilt. I didn't have a million dollars back then. And if this thing had flopped I wouldn't be here talking to you today.

But during the middle of the ad, I went to the ad company and I said, "Hey, we've got a new product, but I don't have another million dollars to do another ad. So can we just put a tagline on the bottom of that commercial that says, 'If you are 65 years or older, you can sell your policy,' 'Call Kelco.'"

And they said, "Sure, we can do that." So they did that, and the ad hit on "Oprah," and we had experienced all of our phone lines blowing up. We had our backup system in Iowa. They blew their phones up. It jammed everything up. And it wasn't so much people that were contacting me to sell their policies. It was a massive amount of insurance agents wanting to know more, wanting to sign up with Kelco as agents.

And this brought us in some 30,000 agents, and within two months we had $9 billion hit the door with senior policies.

Matt Adams: Nine billion with a B.

Stephen Keller: Yes, sir.

Matt Adams: And what year is this?

Before we get into the turmoils and tumult of your life, which is really the key character arc that we're here to explore today about your impacts with the criminal justice system. But this market didn't go anywhere. It-- This-- you were part of the origin story of this market, but you, in fact, are one of the founders of this financial instrument, I think you call it in the book.

Stephen Keller: Yeah, that's correct. I mean, the-- I created the life settlement. I did not create the the viatical that, that, that was created organically through that other market. But, we definitely created the life settlement product. We were the first out there.

Matt Adams: And today that, that life settlement market is a multimillion-dollar, billion-dollar industry, right, Steve?

Stephen Keller: Yeah. I think they leveled out right now. They do about $30 billion a year.

Matt Adams: Wow. So here you are on the precipice of this financial product. I'd imagine you're experiencing the American dream.

You're experiencing the success that we all set out to strive for. And what is the first sign that is going to potentially come crashing down?

Stephen Keller: When we realized that we had a large volume coming into Kelco, the $9 billion, my staff came to me and said, "Keller," said, "we got a problem." I said, "Well, looks like it's going pretty good. What's the problem?" And they said, "We have more policies than there are money to, to purchase the policies the the viatical market."

Said, "It's bigger than the whole viatical market." And, they said, "What are we going to do?" And I said, "There's only one thing to do is go to Wall Street." So I, started my journey in Wall Street at that time. I spent the next two years up there. I dealt with... Or I knocked on 230 doors, and we had 80 deals signed with banks, insurance companies, totaling around $13 billion we raised in two years.

And one of the things that I had done in Wall Street that I'd read about with what Bill Gates did with IBM in the early days, Bill signed a noncompete with IBM. He owned the software, they owned the hardware. They thought the hardware was more valuable, but he showed them otherwise.

Matt Adams: Turns out he was right.

Stephen Keller: He was right, yeah. So I thought, "Well, if it works for Bill, it'll work for me." So everywhere that I went and everybody I met with I signed a noncompete with them. So I literally in two years I had majority of Wall Street locked out of this industry.

Matt Adams: And in, in the book, you describe this burgeoning industry as the Wild West.

And because you were one of its founders, you then endeavored to set out to try to regulate it because there was a lot of shenanigans going on. Talk to us a little bit about that to segue into the discussion of how you actually sought to at least have some regulatory constraints placed around this industry so as to prevent the moral guardrails just coming off altogether.

Stephen Keller: Yeah it was. I mean we had some very unscrupulous people in the industry committing fraud right and left. And it was, it was hurting us. I mean, every time somebody would do something bad to the industry, it would cause us to have a black eye as well. I thought, somebody's got to clean this up, and somebody's got to start regulating the market.

There was too many gray areas there and which opens us up for liability as well. So we employed the ex-deputy insurance commissioner from the state of Kentucky, who's an attorney, to head up anti-fraud department, and also to pass legislation in, in our state. We drafted the bill, wrote the legislation, had a representative to represent us in congress, in the state congress, and got the bill passed.

And we were instrumental with the NCI of passing legislation throughout the country.

Matt Adams: And you co-wrote legislation, by my count, for something like 38 states. Why did you feel like it was your responsibility as a private company to push to regulate and reform your own industry, conceivably to your own detriment?

Stephen Keller: Yeah. My thought process was that if we could regulate the industry, we could get rid of the bad players because they couldn't afford the bonding and the requirements for the state regulation. It, and it kind of cleaned up the industry in itself and it held them to a higher level too.

Matt Adams: So I want to segue then into the more provocative side of the character arc that you describe in your memoir, and it really starts as I think, and correct me if I'm wrong, more and more unscrupulous characters begin to enter your industry, and you start to realize that there might be a target on your back.

Talk to us about that.

Stephen Keller: Yeah, I mean, we kept having a revolving door of characters, if you will, and a lot of them I put in the book that, that we dealt with and the experiences thereof. But yeah, I mean, there was a lot of stuff going on at the time that didn't make sense. There started being a lot of state investigations out of the blue, back to back, and there was of turmoil going on in the, within the industry.

But honestly didn't think that we had anything to worry about because we were heading up most of the regulation in the country. And, I certainly, we wrote the laws for our state, for our company, and we knew we certainly weren't going, we weren't breaking our own laws we wrote. We wrote them.

So, I never worried about the bullseye being pointed at us.

Matt Adams: But when did you realize that it was? When it was too late, or did you sense that something had shifted, some dynamic that, made the hairs on the back of your neck stand up and say, "Whoa, hold on for a second.

They're coming after us"?

Stephen Keller: Yeah. I think at one point in time when they started going after brokers and different companies throughout the country, and their, their focus was evident about they were going after contestable policies. These are policies under two years old. And in our industry, especially our company, we tried to appease to the brokers what everybody was selling. So let's say if we didn't buy every policy that was being tendered or every type of policy, and we only, you know, segmented to half of what was being tendered and the brokers are lazy. They would go with somebody that was acting like Walmart, one-stop shop that they could sell everything they, they had coming in.

So we would consider every types of policy, including contestable policies at the time. Contestable policies were a gray area. There's no regulations against buying those policies. There was risk to us buying them because if the insurance companies contested those policies within two years, then we ultimately, we would lose money because we would have to pay back the investors that money.

It was a risky, proposition, one that's not profitable for us. So ultimately we stopped buying that market, and especially at the time we stopped buying it we really backed off on the viaticals as well because the life settlement market was so huge, and that was our main focus, and we were the creators of that market.

So we, we had our hands full with Wall Street and perfecting that market.

Matt Adams: And along comes Barbara Farrington and Operation Clean Sheet. Talk to us about that.

Stephen Keller: Yeah. So I don't even know where to start with that. It's, I put it in the book and I describe this, rogue company in Carmel, Indiana.

I did change the name in, in the book to protect myself. But, how that happened, that company had a highly accoladed attorney, a really good attorney, but... And the guy was like 6'10". So the president of the company and they, every meeting they went to, they went usually by helicopter. And the pilots told them, the walk path to the helicopter, which they ignored.

It's almost like they had an attitude to be above the law, and they did their own thing their own way. And in that mindset, the attorney walked in a different flight path to the helicopter, and it decapitated him. And so after that, Barbara Farrington took his place. And so at that time, this company was buying other small insurance companies.

They would raid the companies, what I call it. So they would go in and strip all the assets out, take the cash, and put it back in with the holding company to increase capital, increase their stocks. They were publicly traded, so the stock was going crazy by them doing this, the, in, in multiples.

But there, there was no underwriting whatsoever done when they acquired these companies. So when Barbara Farrington took the place of this attorney that got decapitated, she then discovered-

Matt Adams: It's a hell of a way to go.

Stephen Keller: Yeah. She then discovered that their lapse rate was decreasing and their payables were increasing, and she took this information back to the president of the company and told him that they had a problem, that all of the smaller insurance companies they had been purchasing, that my company, Kelco, was listed as the owner for a majority of the insurance policy that he acquired.

And so at that time they began a scheme to look at our industry and see how they could eradicate the entire industry, and we were the largest so they came after me the hardest.

Matt Adams: So here it is, private industry, a private insurance company. You've changed the name of the insurance company in the book to protect yourself.

I'm not asking you to reveal the name of it. But this insurance company, with all its resources, sets its sights upon you and this financial instrument that you have created at the peak of your success. And basically convinces the government to come in and take on this mission. It sounds to me like a very well-placed attorney inside a very powerful, very resourced company that said, "This is an existential threat to our business, and therefore we are going to put them on their heels or worse, and begin to cooperate with the government."

Now I'm struck by the fact that you discovered a letter essentially soliciting a partnership with the government. Talk to us about that.

Stephen Keller: Can you believe that? So the audacity of these people, they had two meetings in the headquarters of this insurance company in Carmel, Indiana.

And one meeting was some 50 insurance companies got together to come up with a scheme to sell the federal government on to eradicate the industry, to use them as a hit person, if you will. And the letter came from Barbara Farrington out to the insurance companies and also the government.

And the letter was basically stating that they have an unprecedented opportunity to partner with the government. And that was to entice the, the next meeting. And the next meeting was, they invited one postal service worker from each state to a four-day seminar, and the insurance companies drafted indictments, sold them a bill of goods that we're in conspiracy with these thousands of agents, that there's no possible way that anybody with any conscience at all would, could believe that, but, that's what they did, and they sold them a bill of goods and gave them the indictments and said, "Go get 'em."

Matt Adams: And so here it is, government in your opinion at least, is just taking its marching orders from a private segment of the industry. And I could imagine that the initial instinct is to say, "Wait a second.

We're helping to regulate this space. We're the good guys in this whole thing. What the heck are you doing coming after us? Because we're just trying to exist with this new financial product." Where did that take you? I know in the book you outlined some steps that you took to try to engage in the political system to-

Stephen Keller: Mm-hmm

Matt Adams: presumably get them to intervene on your behalf, or at least recognize that this was a bonafide business in your view. Talk to us what that was like, because as the name of your book suggests, _Pay to Play_, there was a very seedy underbelly of our political system that exposed you to, which it sounds like you may not have had that much experience with to begin with.

But talk to us about what that was like. I mean, was that the direct response to learning of this investigation that was focusing on your industry and you in particular, that you decided to seek relief from the political system? Or was it just a coincidence that happened?

Stephen Keller: All right, so, I'm going to answer you in two parts. All right? The pay-to-play system and how this worked is the company in Carmel, Indiana, they had more deputized police than Marion County in Indiana had in the whole county.

They had the staff working for them. So ex-CIA, ex-FBI, ex-Postal Service, you name it, they had them. So when it came time to do this, they went to their contacts internally and said, "Who do you know? Who do you know in DC?" And so, they would reach out to their lobbyists, they would pay people off in DC, they would go to their law enforcement to create a task force, and off they go.

They did go to the FBI to begin with, and the FBI told them, said, "There's no fraud there. We're not getting involved." So then they picked it up with the the Postal Service. Well, at that time, I had no idea. I mean, I believed that in the government, in our Justice Department, and I thought, if anybody was sideways with them, then they probably deserved it.

I had no idea.

Matt Adams: You're a bit, you're a bit naive.

Stephen Keller: I was very naive. And I think most people in my age at that time, younger and entrepreneurs and just, trying to live the American dream, we had no idea this beast existed out here how it trampled on people.

So, it was my accountant that came to me and he said, "Steve," he goes, "Look, I've been doing the books for you since you started the company, and if there was fraud going on, I would know about it before anybody." And he said, "This is political." And I... He said, "I don't know who's doing this to you or, what else is going on," but he said, "I can guarantee you it's political and it's got to stop politically."

And he suggested some contacts that I make to get me involved in DC and try to figure out who was behind this and try to stop this.

Matt Adams: And so what'd you do? Who'd you go to?

Stephen Keller: So in over the course of the next two years, the government had, had this investigation going over us.

And, we at that time had befriended the majority leader of Senate. And so this involved many contacts back and forth with him, many meetings. His son owned a polo team in Lexington, Kentucky, and sometimes we would meet out on the polo fields and at halftime we were like in the movie "Pretty Woman" out stomping divots. So

he would ask me what's going on, and the more I would talk, the madder I would get about it, and the harder I would start stomping. But, I was like, "Can you please get these people off, o- off our tail?" And he would tell me whatever I wanted to hear to appease me. And I believe the insurance industry was paying him more money than I possibly could behind my back to make sure my data didn't go good.

So, one year after the raid, I was summonsed to DC, taken into a private room up there. I was with one of my attorneys and my CFO, and the son of the senator was with me. And he was starting a lobbying firm at the time. And so the chief of staff for the majority leader came in this room grinning from ear to ear like he'd won the lottery.

And he said, "So Steve, have you learned your lesson yet?" And I said, "What lesson might that be?" And he said, "Up here, you gotta pay to play." That's the name of the book. So, we did pay. We paid the the senator's son an enormous amount of money per month plus expenses, but we couldn't keep up with the amount that was being spent behind our back, I think, to the senator.

Matt Adams: So you, you attempted to lobby to have this industry recognized for what you thought was a legitimate business. But at the senator's request, you're now lobbying his son, paying for access, but you're being outpaced by a multibillion-dollar industry. At the end of the day you're running out of money.

You can't keep up. It's like being in a foot race with Carl Lewis or, one of these, Usain Bolt, one of these sprinters. You just, at a certain point, you just you run out of gas, right?

Stephen Keller: Exactly. Yeah. I mean, that, it just it's a game that milks you by the time you're into the race.

But, this was not about lobbying. There's no insurance laws at the federal level. It's all state. That's why I never could understand why I was in the federal web. But we were simply told to pay, pay to play, and we were paying to try to garner influence possibly with the attorney general at that level, to stop this or tell us, what was going on or, make some kind of sense out of it.

But ultimately to stop it and save our company.

Matt Adams: Did it feel wrong? Did it feel morally against your personal ethics?

Stephen Keller: Absolutely. I mean, it was totally wrong. It was wrong of us to be asked that. But if you're in a situation of life and death and you're trying to do everything you can to save it, then, when I was told to pay to play, then we started paying. I didn't feel like we had a choice. Did I feel good about it? No. I think it's wrong-

Matt Adams: In the book-

Stephen Keller: ... and it's wrong today.

Matt Adams: In the book, you write something to the effect of a story being told to you by the senator about somebody in his orbit that sort of did their time and kept their mouth shut.

Was that a harbinger for what was to come? How did you interpret that at the time? As a threat?

Stephen Keller: I think it was foreshadowing. It was a very chilling conversation, I remember. And

Matt Adams: Tell us about

it. Describe it for us ...

Stephen Keller: The, yeah, the senator was actually in my building at that time, and I was touring him around, showing him the, all the destruction the federal government, did to the building.

Just, it was unbelievable, that they just came in and tried to, tried to destroy as much as they could. And I said, this should not be going on in America. I mean, this is unbelievable." The disrespect for other people's properties and how they just acted like this rogue people.

And-

Matt Adams: You mean, you mean the investigators coming in and tossing the buildings? Is that what you're referring to?

And they destroyed as much as they could. I mean, just for example, like they were offered keys to certain file cabinets, and they threw the keys down on the ground and drilled the locks out. So just stuff they didn't have to do, but they made a point to, to show their force and destruction.

So I was touring the senator around, showing him, how bad we'd been treated, and I said, "This should not happen." And the senator, he stopped me and he said, "I'm going to share a story with you." And I was like, "Okay." And so he began, he proceeded to tell me that when he started out in politics, there was this man and his wife that had got into some trouble, and I think, the senator was being investigated for in-inappropriate funding for maybe a family member.

And he said that they were coming down on him hard and that they were going to ask this guy to testify against him. And he said, "I owe everything I have to this day and my whole career to this guy." And he said, "You know what he did, Steve?" And I said, "What?" He said, "He did the right thing. He went to prison and never said anything to anybody."

And he said I never will forget that." And so-- And that was it. That was the end of the conversation. So, I mean, what was you supposed to infer from that, this is-

Matt Adams: So here you-

Stephen Keller: ... the majority leader telling you to go to jail and keep your mouth shut.

Matt Adams: Here you are then with one of the most powerful political figures in the country in the crosshairs of a federal investigation in the aftermath of the execution of a a search warrant where you are, property is destroyed, records seized.

Everything that's going on is antithetical to what is supposed to happen in the United States of America. Everything that's going on is absolute power having been corrupted absolutely, and it still gets worse for you because ultimately you're charged, right?

Stephen Keller: Yeah. Yeah, so, we went through all these motions in trying to do everything we could to, make sense of this and put this thing back on the tracks.

And we stayed in business, by the grace of God. We did everything we could to endure this, and we did have massive layoffs, throughout the next couple years. But, we were still hanging on. And ultimately at the end of two years we got indicted.

Matt Adams: Did you ever think of cooperating against the senator, or was that even an option?

Stephen Keller: It was not an option. But my mind wasn't thinking that way at the time. It, it was not never a thought in mind because I mean, I knew we didn't break a law, 'cause like I- I said before, we wrote the laws for the State of Kentucky. I knew we didn't break what we wrote.

So I was actually trying to get this thing behind me as, quickly as I could. And I said, "All right, I've been indicted. Let's go to trial because what are you going to bring against me?" Because we didn't break a law, we didn't break an insurance law. So I was like, "Let's get this over with." And I was thinking that we'd be exonerated if we went to trial.

Matt Adams: So you went to trial and you learned the hard way that the truth doesn't always set you free, I guess. But talk to us a little bit about the trial. I think the parts of the book that describe the trial are particularly poignant. From my assessment, you describe this parade of cooperators who are reciting rehearsed scripts and your defense team is severely limited.

There's even this dramatic moment when the US Attorney General appears at your trial. So talk to us about this. Like, a motorcade shows up and the Attorney General of the United States of America engages with your judge.

Stephen Keller: Yes. Which goes back to that senator, and that's one of the reasons that we had seeked him out, because of his influence with the attorney general.

They were in a quartet together. They called themselves the Singing Senators, and he was one of them. And i- if you fast-forward four or five years ahead, that senator was caught up with his brother-in-law in a case where the brother-in-law was convicted for bribing judges. So they were swaying judges to go, their, th- their way on, on the trials so th- they would win the judgments.

And he ended up going to prison and the the senator ended up stepping down from office. So same senator that had influence there on, on judges, now you see his partner coming to our trial, going in and speaking with my judge, getting back in his motor brigade and taking off.

Matt Adams: What'd you think-

Stephen Keller: And it-

Matt Adams: when you saw that? What'd you think- Oh, I- ... when you saw that?

Stephen Keller: When we were coming back from recess from our company, at noon, I had like 16 people with me, this entourage of people and attorneys, and we came back and we were frozen in our tracks. Every- I think everybody stopped at the same time.

This, it was this like, this eerie feeling come over us and my heart dropped to my feet. And the life just left me, and I knew that at that time we were done. I knew whatever this was, it's not good. We saw Secret Service guys on the steps of the courthouse and then we saw Ashcroft get back in his car, and they drove off.

And after that, the whole demeanor of the judge changed. Anything my attorneys asked for, they were not granted. The jury instructions were slided, incredibly one-sided to the government. I mean, there, there was absolutely no due process from that meeting on for me.

Matt Adams: And ultimately, you were convicted in this case. How was it possible in your assessment for you to be convicted at the federal level for crimes related to your insurance business when insurance is regulated by the states?

Stephen Keller: It was the most incredible thing, and I kept asking why I'm here.

Why don't we go back to the states? And, I didn't know it at the time, and none of my attorneys, no attorney in there was used to having a case like this in federal court. And that was evident because the prosecutors, they actually hired a lady that was an attorney from the Department of Insurance and put her on their team so they could understand insurance.

Nobody had a clue at that level about what was going on. So, and no insurance laws got brought up because there are none at that level. And the most incredible thing is there's a McCarran-Ferguson Act, that in layman's terms basically says if you're caught up in the federal level as a business of insurance, that you're to be remanded back to the states where the insurance laws are found.

Of course that never happened. And we were charged with conspiracy to commit mail fraud because we bought and sold these contestable policies where people had lied sometimes on their applications. Like, for example, if they had AIDS, maybe they answered no, or if they had HIV, it asked, "Do you have AIDS?" And they said no. Maybe they answered truthfully, I don't know.

But, anyway, they made exceptions to that, and these were only on the policies that were under two years old. That was their whole case. And, there was no laws against buying these policies at that time. And one year after I was in prison or actually, I think it was like four years later maybe, Kentucky amended the bill that we passed and added onto it that it was illegal to buy policies under two years old.

So it was clearly evident that this practice was not illegal whatsoever.

Matt Adams: So ultimately you are convicted, you are sentenced, and you make a deeply personal decision, and that is to run.

Stephen Keller: Yeah.

Matt Adams: Talk to us about that.

Stephen Keller: I think after seeing the John Ashcroft sight and how the cards were so against us, it... I just felt hopeless. I felt like there's not going to be any due process whatsoever.

I was facing a 14-year sentence. I had two small kids, a wife, and we'd lost just practically everything we, we ever built. So I had a guy that I knew that I'd hired at the time for w- the day of the raid. It was his first day to come and act as a ghostwriter to write a financial manual for me.

So he and I, were talking after at this point and he mentioned me. He said, "Look, if you ever want to leave the country, I've got a guy to help you disappear." And at first blush, I thought that was a ludicrous idea. I didn't even entertain it whatsoever. But then there was a point in time when things started happening and we were on appeal, out, not on bond or anything, just out.

And, things started happening about, My attorney called me one day and said that they're, they wanted to incarcerate me right away. And I was like, "How can this happen? We're still on direct appeal." And he goes, "I don't know." So there was lack of information given to me what was going on at that time.

And, I really started thinking back about what the ghostwriter had told me. It was embedded in my mind as an option, like the last option possible. So, we actually had a meeting with all of our families and we said, "Look, here's the deal. This is an option we have. I would really like to, stay a father to my kids and there's not an easy solution here."

If we leave, we didn't know if we're ever going to come back or not. We didn't know if we're ever going to see our families again or not. So there was not a win on any decision we made. But the families decided that, given the history of what we had endured, that they thought it was best that we just, we just leave.

And that's what we tried to do. And it might not have been the most rational thing, but, And people ask me, they say, "Would you do it again if you had the opportunity?" And at that time, there was really no other option for me.

Matt Adams: So your book details the extent to which you went to get out of the United States.

Particularly I was struck by the fact that you bribed a pilot with a Mickey Mantle rookie card, and as a sports card collector myself, I recognize that's a valuable and very rare card.

Stephen Keller: Yes.

Matt Adams: You are that... i'm envisioning this private plane with your wife, your children, some basic belongings, and this new identity.

It's like witness protection, except you weren't doing this with the government's say so. You were doing this to flee. Do you recognize now that was wrong?

Stephen Keller: Yeah, looking back at the at where we were with all that going on, with the Ashcroft scene and everything that was happening and how the corruption that we were enduring during this trial.

I mean, there was one prosecutor that, on the government's team, the lead prosecutor, his ex-wife, who they had the same name and they shared a autistic daughter together, she worked for me. So she was in the finance department, so ... And she left, before the raid came. So there was all kinds of illegal activity that was happening, coming at us like a tsunami.

And it just went on. The show went on. nobody took exception to it. I mean, it was just, it was unbelievable. It wasn't the best option to take, granted, but we felt like at the time it was the only option available. And going through this, I mean, I, I had been through the mill for two years and, a lot of people that go through so much pressure like that of unwinding the company and trying to survive and trying to fight the fight, I mean, it, it takes a toll on you.

Matt Adams: Well, how long were you on the run? You went to Panama. You're now trying to integrate you and your family into this foreign society. How long did you, you make it on the run?

Stephen Keller: Well, we were only gone about six months before they caught up with me. So eventually went to Cancun.

That, that was our first stop.

Matt Adams: And when, wh- how, describe how you got caught and what it was like. The book- So- ... it's a prof- it's a profoundly human moment too, a- and I'm just going to set the stage for it because I can just picture it's so mundane, and all of a sudden you think you're free and clear of this corruption machine that incarcerated you, and it caught up to you.

Talk about it.

Stephen Keller: Yeah. So, we were in Panama and I was actually working with an attorney there. His father was a judge in Panama. And I was like the business guru for this guy. So people would come in and propose deals for him to look at or investments or whatever. So I would figure it out, what's real, what's good, what's bad, what's fraud.

So you know, this guy took us in and had us set up an apartment. He had kids our kids' age, so he would take us with him when we would go on trips or weekend outings or whatever. So it was working out really well. And then one day I got a phone call by my wife at the time, and she called me to tell me that she was extremely ill and she wanted me to come home.

So I had the attorney to drive me back to the house.

So the attorney drove me back home and I met my wife and she looked deathly ill. And she said I think I've got the flu or something." She said, "I felt awful." And my son Cole, he had karate class later that day. She goes, "Would you mind driving him to karate class?"

And I said, "You know how I feel about this. We talked about this. I don't want a small traffic infraction to bring down the house, so you know I really don't want to do that." And she begged and begged, and finally I gave in and I took him to the karate class. And back then that was before cell phones, GPS, and I was the world's worst on directions.

I would get lost in a paper sack. So, that probably was a benefit for me at that time because it was really hard to, put a tail on me because I was making wrong turns and trying to correct. But I got to the school and we stayed there, and he got done. And so I got back in the car, we were going back home, and I was pulled over with this policeman on a motorcycle.

And I don't know if they still do this now, but back then they had AK-47s strapped to their backs and which was very intimidating for an American. And so he pulled me over and I told him I didn't speak the language. And he motioned for me to pull over in this vacant lot. This lot looked like it had been a parking lot at one time for like a Walmart.

There was no building there, so it had been torn down. It was just a huge space. So I pulled over in that space, and here cars out of nowhere, they just started forming a half-moon around our car. My son's in the backseat in his little karate outfit. And when these cars would pull to a halt, they would come to a screeching halt, they would throw their doors open and guns would be laid on top of the car doors pointed at us.

So there must've been some 30 cars that accumulated this half-circle.

Matt Adams: Wow. So you were taken into custody, you were extradited back to the United States and ultimately served a nearly nine-year prison sentence. During that time, I can just imagine how life had many ups and downs. But what did you learn about yourself during those nine years in prison as you sat there and life seemed to come undone?

Stephen Keller: I learned who I thought I was and who I really was. And, I started formulating, what I can do with this time and so this time's not wasted. And that's when I started to learn how to write. I self-taught myself in there. I read books on how to write by Stephen King and John Grisham and other writers out there and, I just started practicing.

So I wrote 7,000 pages by pen and ink before I perfected what's now Pay to Play. I did that and-

Matt Adams: Wow.

Stephen Keller: ... I got my paralegal certificate to fight my case. I never gave up the fight and, I think I have a title filing the most motions ever filed in that district. But, you know what they say about how you can tell if people are guilty or innocent in federal prison is, they run out of appeals, so eventually you appeal to the point where you can't.

But if you're actual innocent, you never run out.

Matt Adams: What's the status of your case today?

But right now, it's been dormant for years. So, I just wanted to get the book out and use this story to tell folks that this can happen to anybody. It can happen to you. It's like carte blanche out here. It can happen to anybody. So, and I want to try to use the story to make a difference, so this doesn't happen to other people.

Matt Adams: What would you say, Steve, to the skeptics out there that might say you were putting your toe on the line, you were operating in a gray area, that some of this corruption you describe may not be truly there? What about the people who don't necessarily believe you? What would you say to them?

Stephen Keller: Well, I mean, I think the majority of businesspeople out there, especially entrepreneurs, they're pioneers in their areas and they're going to explore gray areas. We certainly did, and the contestible market was a gray area. A lot of our business was a gray area. I mean, for years we had no regulation, so it was truly one of the true free markets out there, supply and demand.

But we didn't set out to build this company on fraud. You'll see a lot of companies like it's, pick "The Wolf of Wall Street." I mean, that, that company was built on fraud. This was not. The fraud happened externally. There was f- there was fraudulent activity with these insurance companies that used the- their fraudulent schemes to come after us.

So we, we did not build our foundation on fraud, nor did we think that anything we were doing was criminal.

Why tell the story now?

Stephen Keller: I wrote this book, for my kids and for my ex-employees, and so that one day, one day know what happened the true story. But several reasons why I waited. I've had three publishers, and they kept getting bigger as I waited, so I guess I waited for the right time. But I think timing is everything, and I was fearful for a long time that people would come after me.

I was feared for my safety and my kids and they're older now and obviously, and then, and time's going by. But we have the greatest tools in the world right now with all the platforms, AI we can create the greatest transparency ever now to ferret out the truth, and I think that's what's going on, and people are finally seeing the inner workings of the government.

And years ago, if I would've come out with this story back then, there's nobody would've believed me. They would've said, you've made all this up." And Matt, in coming out with the book, I started getting exposed to these organizations that they didn't have when I was going through this, which I think are tremendous.

These white-collar support groups, other support groups that are people going through this that are truly getting help from the communities. But the thing that bothered me is

I started hearing the same playbook that I went through. And I thought, "My gosh," "it's been all these years, all these white-collar guys with triple A personalities, nobody's done anything to stop this?" We got to stop attacking the innovators and entrepreneurs, the fiber of this country.

So it was like a kick in the gut to me. And I realized that this was no longer about me or my book. My book was going to be a a showcase for how this can happen to anybody. So I started, a nonprofit organization called Justice Restoration Foundation. And I really want to start presenting some laws or amend some laws that help level the playing field out between the prosecutors and the defense attorneys.

And also provide relief for people if the government comes after them, I mean, they don't s- they just don't say, "I'm sorry" over a bogus case and leave them bankrupt. There's got to be some repayment. I mean, we're looking at the Hyde Amendment and we're looking at other things out there to amend to, help repay people that go through this.

So my goal is to help bring, if you will the civil type of actions up to the federal level. So we do have fair playing field. Because right now it's not. It's the most one-sided, court system that, that I know of in, in the world.

Matt Adams: Well, if you'll indulge me for a second, I want to read the inscription that you wrote in the autographed copy of the book that you sent me.

It says, "Matthew, when prosecution becomes the crime, defenders like yourself are what stands between citizens and the abyss. Grateful for the conversation." That's pretty powerful stuff, Stephen. In my waning moments with you today, I got to ask, have you lost faith in the criminal justice system, or is there something that can be saved from your experience?

Is there somebody else that can be saved? Is the system still... is it rotten to its core in your mind, or is it something worth fixing?

It would be so easy for you to just throw up your hands and say, "I've been screwed. I'm going to live out my remaining days as angry as I want to be.

I did my time. I'm out of prison. I'll just sit here and stew over it." But that's not what you're doing. That's not what you're doing. So I think I know the answer to my question. But go ahead.

Stephen Keller: No, I feel like this story needed to be told, and I'm the one to tell it.

A- and I feel like that I have the wherewithal and support now, and I'm gaining more support every day, to make a difference. I think we have the greatest system in the world. I think it's very corrupt. We just have to clean the corruption out of it and make it a level playing field, and then we can go back to where it's supposed to be.

I had a conversation with the that senator in my office at one time, and he looked at me and he said, "Steve," he goes, "We know there are problem on Capitol Hill, but we don't know what to do about them." And I retorted and I said, "I do." I said, " Do you think our forefathers ever set out to incentivize the justice system?"

And he said, "What do you mean?" I said, "It goes on from the lower rung all the way to the top." So, at the end of the month, you've got s- speeding quotas and speeding tickets being given out by the local cops because they have these quotas. And I said it, it goes all the way to the u- up, upper top to, with the federal government.

I said, "You guys give them points, you give them monies, you give them bonuses for, convictions, for forfeitures." I said they forfeit a company's money, they get a percent of that." And I said, this is not the way it's supposed to go." I said, "If you get rid of the i- incentivized scheme that's set up now in all law enforcements then you can take it back to where it's supposed to be credible."

Matt Adams: Our guest has been Stephen L. Keller. His book is _Pay to Play: Political Corruption, Corporate Greed, and the Cost of the American Dream_. It is a must-read. The story, whether you want to believe every angle of it or not, is a compelling one, an eye-opening one, and something that should be studied. Steve, it's been so great to have you on "The Presumption of Innocence."

That's all the time we have for this episode, but until next time, I'm your host, Matt Adams. We'll see you then. Take care.