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Ex-radio host sues Star Tribune, Pioneer Press over Ponzi reportage

Former Christian-network radio host Pat Kiley, mixed up in twin federal investigations involving admitted Ponzi schemer Trevor Cook, is suing the Star Tribune, Pioneer Press and reporters Dan Browning, Sarah Gorvin and Frederick Melo for a total of

Former Christian-network radio host Pat Kiley, mixed up in twin federal investigations involving admitted Ponzi schemer Trevor Cook, is suing the Star Tribune, Pioneer Press, and reporters Dan Browning, Sarah Gorvin and Frederick Melo for a total of $17 million.

Kiley asks for the following defamation damages: from the Strib’s Browning, $4 million; from Gorvin, an intern who shared bylines with Browning, $2 million; from the PiPress’ Melo, $2 million. The Strib and PiPress claims are for for $6 million and $3 million respectively. The broadcaster also claims damages of $25 million from non-media figures.

Kiley — who is serving as his own lawyer — filed the complaint Monday in U.S. District Court in Minneapolis. A linchpin of his media beef?

“On or about July 19, 2009, defendant Browning wrote an article stating Plaintiff had traveled to foreign countries on a spending spree with Trevor Cook where he and Cook spent 40 million dollars worth of defendants’ money.”

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Kiley contends he showed Browning his passport which showed he only traveled once, to Belize in 1999.

A search of the Strib’s archives doesn’t find the $40 million reference in a July 19 story, though it does appear Nov. 25. The source? Securities and Exchange Commission regional director Merri Jo Gillette, who in a prepared statement announcing a court order freezing Cook’s and Kiley’s assets, said:

“Cook and Kiley told investors that their money would be invested safely and profitably. Instead, they went on a $40 million-plus spending spree with investors’ money and lost another $40 million in risky foreign currency trading.”

Gillette doesn’t allege Kiley physically traveled anywhere as part of the alleged scheme.

In another count leveraging the passport, Kiley notes that Browning wrote, “Cook and Kiley, in effect operating a Ponzi scheme, diverted approximately $51 million of the investors’ funds to pay ostensible returns and principal to other investors.”

Again, the source is the SEC statement. That agency’s complaint is here, and the investigation is open. Kiley has not been charged.

Cattily, Kiley alleges that Melo “has never interviewed Plaintiff, but yet has written articles which have ‘piggy-backed’ the articles written by defendant Browning. To the extent that Browning failed to check his facts, defendant Frederick Melo has failed to check his facts also.”

Melo, however, relies on the same SEC and Commodity Futures Trading Commission documents Browning used. Melo’s stories indicate he contacted Kiley’s criminal defense attorney, Peter Wold, for comment.

Star Tribune senior vice-president and general counsel Randy Lebedoff termed the complaint “completely without merit and [we] will vigorously defend against it.” Melo told City Pages, “I’m going to let my employer handle it and I’m moving on to the next story.”

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See Kiley’s full complaint below:

Kiley v. Browning, et. al.