By: Frank Parlato

This is the second in a series on James D. Clark, the FBI informant who manufactured an attempted kidnapping case against Leo Grillo, 77, founder of DELTA Rescue, the world’s largest no-kill, care-for-life animal sanctuary.

In Part One, we established that Clark was under active FBI investigation for fraud when he approached Grillo, selected him as a target, and delivered an entrapment case in exchange for favorable consideration on his own charges.

In Part Two, we look at where Clark came from — and why his willingness to betray anyone, including his own father, should have told the FBI everything they needed to know about the man they were trusting.

James Clark did not invent this scheme. He inherited it.

His father, Jim Clark, built Republic Monetary Exchange into one of Phoenix’s prominent precious metals firms. Before that, the elder Clark had served seven months in prison after being convicted of selling unregistered securities at Sheffield Metals, which declared bankruptcy in 2003 with $6 million in liabilities and $1.5 million in assets. Customers who had trusted Sheffield with their savings lost everything. The court ordered him to pay $1.5 million in restitution. By the end of his probation in 2006, the elder Clark had paid back $42,000.

Jim Clark was also tied to North American Coin and Currency, a Phoenix firm that collapsed in 1982. Federal investigators found multiple types of fraud. Customers who had trusted North American to store their gold and silver learned the vaults had been cleaned out. Approximately 4,200 people lost $16 million.

In July 2009, James D. Clark joined his father’s new company, Republic Monetary Exchange, as vice president of sales. He worked there for three years.

In January 2012, he resigned. He immediately founded a competing firm called Core Resource Management. Then — aligned with his father’s adversary, Sherman Unkefer — he gave deposition testimony so damaging it nearly put Republic Monetary Exchange into court-appointed receivership.

Sherman Unkefer Grillo - Frank Report — Sherman Unkefer the enemy of Jim Clark got informant James D Clark on his side

His father called the testimony “absolutely and totally false.” He sued his son for stealing client data and handing it to the enemy.

Consider who young Clark’s new partner, Unkefer, was. He had served five years in prison for his role in the North American Coin collapse. Ordered to pay $7.5 million in restitution to 4,200 victims, he had paid $4,030 over the course of decades — allegedly hiding the rest behind Cook Islands trusts, shell companies, and his deceased wife’s estate, to keep the money away from his victims and in his hands. He was running a mangosteen juice MLM scheme while conducting meetings at his dying wife’s hospital bedside to plan his next gold venture with Jim Clark.

This was the man James D. Clark chose over his own father.

The son denied stealing client data. He said he stood by every word of his testimony.

Within two years of leaving his father’s company, Clark had built a competing precious metals operation — Midas Gold Group — targeting the same retirees on the same conservative talk radio networks, using the same IRA conversion pitch. At its peak, Midas Gold generated $143 million in a single year.

The son had learned well. From his father. From Unkefer. Both of whom went to prison.

When his own scheme collapsed, and the FBI came for him, Clark did what the record suggests he had always done. He found someone to hand over.

He had handed his father to Unkefer’s lawyers.

He handed Leo Grillo to the FBI.

A man who will testify against his own father will say anything to save himself. The FBI knew the kind of man they were dealing with. They used him anyway.

Next: The victims — and what Clark actually did to them.