KICKED TO THE CURB
Ex-Saints punter Erxleben remains on probation and an outsider to
the University of Texas 27 years after he was a first-round pick by
New Orleans
Monday, April 24, 2006
By Ted Lewis
Staff writer
There are worse things than being considered the biggest draft bust
at your position.
Like serving five years in federal prison for securities fraud and
being such a pariah at the college where you were a three-time All-
American that no one there wants to talk about you.
Such is the standing of Russell Erxleben, whom the Saints made the
highest drafted kicking specialist when they took him with the 11th
pick in 1979. Erxleben could never win the team's place-kicking job,
although he spent five years as the team's punter.
Since his release from prison in November, Erxleben is living near
Austin, Texas, with his wife, Kimberly, and their three children. He
remains on probation.
Erxleben, who declined to be interviewed, is "doing great"
and "doing the same work he was doing before, " according to his
mother, Patsy Erxleben.
In September 2000, Erxleben was sentenced to seven years in prison,
fined $1 million and ordered to pay $28 million in restitution after
pleading guilty to defrauding nearly 500 people who lost $34 million
investing in Austin Forex International Inc., a foreign currency
trading firm he operated from 1996 until 1998, when the firm was
closed by state securities regulators.
Erxleben promised investors that no more than 10 percent of their
money would be at risk and boasted investment returns between 70
percent and 100 percent.
"I'm sorry for what I did," Erxleben said at his sentencing. "I
never intended to harm anybody from the very beginning.
"I tried to save my business. I knew what I was doing was wrong when
I did it. But I did it with the right intent."
The government didn't see it that way.
The prosecutors said Erxleben was running a Ponzi scheme, making
false representations about the past returns Austin Forex was
generating plus the risks involved and keeping things afloat by
sending out false account statements.
Erxleben's notoriety as a former Texas Longhorn football player was
cited as his entr?e to many of the investors, although reportedly
none of his former teammates were among them.
"There's a clique that loves to be around Texas football players no
matter what," said Ed Martin, an IRS special agent who investigated
the scheme. "And you can sting them once, sting them twice, and they
keep coming back for more. Unbelievable."
During Austin Forex's heyday, Erxleben was riding high.
He had a suite near the 50-yard line at Darrell K. Royal-Texas
Memorial Stadium and was a regular on the city's best golf courses.
A 1997 story in the Austin Business Journal called Erxleben an NFL
legend and talked of a trading style that blended an instinctive
feel for market dynamics with his own innate conservatism.
"Russell has a God-given talent," Leslie Katz, chief administrative
officer of Austin Forex, was quoted in the article. "This is not the
kind of thing you can pick up from books."
But Martin said it was all a front.
"Russell was shameless," he said. "He'd be out playing golf with
someone, his pager would go off, and he would claim that he'd just
made $100,000. Anything to induce people to invest. And it was a
good con, because he was convincing people that if you're not in it,
you should want to be, because everybody else is making money on
it."
Said former Texas Securities commissioner Denise Voigt
Crawford, "It's much harder for people to be appropriately skeptical
and do their homework when they're in the vicinity of such a
charismatic person."
Austin attorney Michael Shaunessy, who filed the class-action
lawsuit on behalf of investors that got $22 million in restitution
from the law firm that represented Erxleben while Austin Forex was
in operation, said that Erxleben probably did not start out to
deliberately commit fraud.
"Russell perceived himself to be a very successful foreign currency
trader," he said. "But Russell was not a successful foreign currency
trader. As the losses mounted, instead of reporting them, he lied to
keep getting more people to invest. Many of the investors were
seniors whom Russell convinced to borrow equity out of their homes
and hand over their IRA money to him. That was the real crime."
The Austin Forex case wasn't the first time Erxleben had run afoul
of the law.
In the early 1990s he was involved in numerous alleged ripoff
investment schemes along with having to answer charges concerning
worthless checks, promissory notes and court judgments.
In one sworn affidavit, a former business partner claimed Erxleben
told him that "I wouldn't live past the weekend," if he didn't leave
town, citing his Mafia ties.
Erxleben filed for bankruptcy in 1991, saying he was unable to repay
debts totaling about $2 million, claiming as his only assets $1,000
in clothes, some furniture and other household goods plus a $35,000
retirement fund.
In 1993 Erxleben spent a night in the Harris County Jail in Houston
after allegedly hitting a former business associate in the mouth
with a cellphone.
But none of those problems resulted in any other jail time and three
years later, Erxleben apparently had put the bad days behind him --
at least until investors started complaining.
"Erxleben was the perfect con man," said Martin, who now runs a
private investigation firm in Austin. "He was the guy next door,
your buddy on the golf course -- not to mention being a former Texas
football star.
"The trouble was he'd shake your right hand with his right hand, but
his left hand would wind up in your pocket."
Even after his guilty plea in November 1999, Erxleben could not
avoid trouble.
He had requested and received several sentencing delays but found
his bond revoked after he was accused of threatening a former friend
and investor.
"It's like Kimberly said afterwards, 'As we all know, Russell's
mouth can get him into a whole lot of trouble,' " Shaunessy said.
Erxleben served his sentence at a minimum security facility in
Beaumont, Texas, and was released two years early for good behavior.
According to a U.S. Probation Department spokesperson, Erxleben has
been abiding by the terms of his release, but his financial
activities are subject to investigation.
And at the University of Texas, Erxleben is Longhorn-non-grata.
Former Texas coach David McWilliams, now head of the T Association,
the school's lettermen's group, did not return phone calls
concerning Erxleben.
And despite Erxleben's exploits on the football field, which include
a 67-yard field goal that still is the NCAA record almost 30 years
later, he has never been elected to the athletic department's hall
of honor.
Ex-Saints punter Erxleben remains on probation and an outsider to
the University of Texas 27 years after he was a first-round pick by
New Orleans
Monday, April 24, 2006
By Ted Lewis
Staff writer
There are worse things than being considered the biggest draft bust
at your position.
Like serving five years in federal prison for securities fraud and
being such a pariah at the college where you were a three-time All-
American that no one there wants to talk about you.
Such is the standing of Russell Erxleben, whom the Saints made the
highest drafted kicking specialist when they took him with the 11th
pick in 1979. Erxleben could never win the team's place-kicking job,
although he spent five years as the team's punter.
Since his release from prison in November, Erxleben is living near
Austin, Texas, with his wife, Kimberly, and their three children. He
remains on probation.
Erxleben, who declined to be interviewed, is "doing great"
and "doing the same work he was doing before, " according to his
mother, Patsy Erxleben.
In September 2000, Erxleben was sentenced to seven years in prison,
fined $1 million and ordered to pay $28 million in restitution after
pleading guilty to defrauding nearly 500 people who lost $34 million
investing in Austin Forex International Inc., a foreign currency
trading firm he operated from 1996 until 1998, when the firm was
closed by state securities regulators.
Erxleben promised investors that no more than 10 percent of their
money would be at risk and boasted investment returns between 70
percent and 100 percent.
"I'm sorry for what I did," Erxleben said at his sentencing. "I
never intended to harm anybody from the very beginning.
"I tried to save my business. I knew what I was doing was wrong when
I did it. But I did it with the right intent."
The government didn't see it that way.
The prosecutors said Erxleben was running a Ponzi scheme, making
false representations about the past returns Austin Forex was
generating plus the risks involved and keeping things afloat by
sending out false account statements.
Erxleben's notoriety as a former Texas Longhorn football player was
cited as his entr?e to many of the investors, although reportedly
none of his former teammates were among them.
"There's a clique that loves to be around Texas football players no
matter what," said Ed Martin, an IRS special agent who investigated
the scheme. "And you can sting them once, sting them twice, and they
keep coming back for more. Unbelievable."
During Austin Forex's heyday, Erxleben was riding high.
He had a suite near the 50-yard line at Darrell K. Royal-Texas
Memorial Stadium and was a regular on the city's best golf courses.
A 1997 story in the Austin Business Journal called Erxleben an NFL
legend and talked of a trading style that blended an instinctive
feel for market dynamics with his own innate conservatism.
"Russell has a God-given talent," Leslie Katz, chief administrative
officer of Austin Forex, was quoted in the article. "This is not the
kind of thing you can pick up from books."
But Martin said it was all a front.
"Russell was shameless," he said. "He'd be out playing golf with
someone, his pager would go off, and he would claim that he'd just
made $100,000. Anything to induce people to invest. And it was a
good con, because he was convincing people that if you're not in it,
you should want to be, because everybody else is making money on
it."
Said former Texas Securities commissioner Denise Voigt
Crawford, "It's much harder for people to be appropriately skeptical
and do their homework when they're in the vicinity of such a
charismatic person."
Austin attorney Michael Shaunessy, who filed the class-action
lawsuit on behalf of investors that got $22 million in restitution
from the law firm that represented Erxleben while Austin Forex was
in operation, said that Erxleben probably did not start out to
deliberately commit fraud.
"Russell perceived himself to be a very successful foreign currency
trader," he said. "But Russell was not a successful foreign currency
trader. As the losses mounted, instead of reporting them, he lied to
keep getting more people to invest. Many of the investors were
seniors whom Russell convinced to borrow equity out of their homes
and hand over their IRA money to him. That was the real crime."
The Austin Forex case wasn't the first time Erxleben had run afoul
of the law.
In the early 1990s he was involved in numerous alleged ripoff
investment schemes along with having to answer charges concerning
worthless checks, promissory notes and court judgments.
In one sworn affidavit, a former business partner claimed Erxleben
told him that "I wouldn't live past the weekend," if he didn't leave
town, citing his Mafia ties.
Erxleben filed for bankruptcy in 1991, saying he was unable to repay
debts totaling about $2 million, claiming as his only assets $1,000
in clothes, some furniture and other household goods plus a $35,000
retirement fund.
In 1993 Erxleben spent a night in the Harris County Jail in Houston
after allegedly hitting a former business associate in the mouth
with a cellphone.
But none of those problems resulted in any other jail time and three
years later, Erxleben apparently had put the bad days behind him --
at least until investors started complaining.
"Erxleben was the perfect con man," said Martin, who now runs a
private investigation firm in Austin. "He was the guy next door,
your buddy on the golf course -- not to mention being a former Texas
football star.
"The trouble was he'd shake your right hand with his right hand, but
his left hand would wind up in your pocket."
Even after his guilty plea in November 1999, Erxleben could not
avoid trouble.
He had requested and received several sentencing delays but found
his bond revoked after he was accused of threatening a former friend
and investor.
"It's like Kimberly said afterwards, 'As we all know, Russell's
mouth can get him into a whole lot of trouble,' " Shaunessy said.
Erxleben served his sentence at a minimum security facility in
Beaumont, Texas, and was released two years early for good behavior.
According to a U.S. Probation Department spokesperson, Erxleben has
been abiding by the terms of his release, but his financial
activities are subject to investigation.
And at the University of Texas, Erxleben is Longhorn-non-grata.
Former Texas coach David McWilliams, now head of the T Association,
the school's lettermen's group, did not return phone calls
concerning Erxleben.
And despite Erxleben's exploits on the football field, which include
a 67-yard field goal that still is the NCAA record almost 30 years
later, he has never been elected to the athletic department's hall
of honor.
