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Milan, Welborn--Sky Jones 1997 deposition SEC v. ITEX

SECURITIES AND EXCHANGE COMMISSION
In the Matter: File No. HO-3198
ITEX CORPORATION
Witness: MICHAEL RICHARD WHIPPLE (aka SKY JONES)
PAGES: 1 through 232
PLACE: Fort Worth, Texas
DATE: September 4, 1997

("Milan" cited 8 times. Ronald/ Ron "Wellborn" 58x / "Welborn" (one "L") 1x. "National Institute of Appraisers" 6x/ "NIA" 8x. Use CTRL-F to search)
https://www.bankers.art/about/newsandpress/news/sec/secdeposition1997.pdf

Page 57

1 A: I could go out And sell more and collect a lot
2 more cash, but I have, by my philosophy, I live below the
3 poverty level.
4 Q: What do you do with ...................... now, the 7000 paintings,
5 did they ever get completed?
6 A: Well, they weren'-t done. And then Ronald
7 Wellborn contacts me .................he goes to this art show they have
8 here in Fort Worth, he contacts me-and he says, "Hey, come
9 on out to Fort Worth.11 You know, I says, "Well, geez, I've
10 got to,$250,000 to finish all these paintings." "No
11 problem. I can do it. We'll do it." I says, "Well, it's
12 got to have this and this and this and this." 110h, we'll do
13 it, we'll do it, we'll do it." So I said, 110h, okay."
14 So he shipped out several semi-loads full of this
15 junk
16 Q: Wait. He shipped out. What do you mean?
17 A: That means that from Salt Lake where I was
18 Q: Right.
19 A: ... .. I loaded semi-trailers and he shipped the
20 stuff into Fort Worth, all of it into Fort Worth.
21 Q: When you say "junk," what junk are you talking
22 about?
23 A: Okay. First of all I have to explain my
24 terminology.
25 Q: Yeah, because I didn't understand.

Page 58

1 A: I'm sorry.
2 Q: Yeah.
3 A: Junk means anything in the physical universe. if
4 it's valuable, it's not junk. And if it's valuable, you'd
5 better keep it. And so if you're going to move it, you'd
6 better not think it's that valuable. You'd better think
7 it's junk.
8 Q: Okay.
9 A: And as one trader...... traders always refer to each
10 other's stuff as "junk." In the retail merchandising of
11 merchandise, it's always junk. And that is the standard
12 word. I think if you look it up in the dictionary, it's
13 definition number 11.
14 Q: So Mr. Wellborn did send some large trucks to
15 where you were in Salt Lake to pick up the 7000 unfinished
16 pieces of art work to transfer...
17 A: Plus many others. Keep in mind I work by the
18 mile. You are talking to a guy here that personally has
19 painted mileage purposefully. One year all I had was 5888
20 feet long, and it wasn't a 48-inch one. It was more like
21 60. And I single handedly painted the whole roll. It was a
22 process. And it was a great process. I learned a lot about
23 painting, and, you know, some of the good stuff came out of
24 it. I cut some of the pieces up and then repainted on them
25 again. Threw a lot of it away. But I run mileage.

Page 60

11 Q: Can we get back to the ... now, we've got the
12 paintings being I guess packed on these trucks and then
13 they're being...
14 A: Yeah.
15 Q: And Wellborn sent ... where did Mr. Wellborn
16 A: Haltom City. He had them taken up to Clay Street
17 in Haltom City where he was partners with Mr. Henry Simon,
18 who had a warehouse there. Wellborn, to get me to send the
19 paintings, he promised certain things. He promised that we
20 would be able to complete the project and he promised that
21 he would give money to the Banker Art Museum for
22 certification[. And he made a lot of promises and he never
23 kept any of them.
24 Q: Can you tell us what he promised? I mean he was
25. going to get them all certified through the Bankers Art

Page 61

1 Museum...
2 A: He was going to pay Artie for every single one of
3 them and he didn't. He ordered me off the property at gun
4 point. He put locks on all the trailers. Keep in mind,
5 you're talking ... you've got a guy sitting across ... I may be
6 a dumb shit, I'm a wimp. I'm not going to fight. I am not
7 going to fight. Might yet, maybe not though, but I'm not
8 going to fight. Why? Because if that bird doesn't sing
9 anymore, he has to go back to the pet shot. And I just got
10 out of the pet shop and I'm going to keep on singing. I am
11 not going back in that pet shop.
12 Now, if this guy thinks that he's going to take
13 the.joy out of my spirit, it's real clear that that's what
14 he's trying to do. He lied to me. This guy is really a no
15 good guy. I'm telling you. He was on an ankle bracelet, on
16 parole, and he was committing crimes ...
17 Q: How do you know this?
18 A: Because I talked to his .... after I had the
19 deposition, after the big lawsuit and he stole all my art,
20 just exactly the same thing as Newren. I found out that he
21 was on parole. And he had an ankle bracelet on and had been
22 smuggling, and had pleaded guilty to this and this and this
23 and this,and this. And I said, "I don't believe this-"
24 This was going on and I was sitting there like a lamb at the
25 slaughter. Yeah. Yuck.

Page (61 blank) 62

1 So here I am stuck against a rock in a hard spot,
2 still trying to remember what song I'm suppose to be
3 singing, you know, so I don't have to go back to the pet
4 shop. Man, this guy is just crazy. You know, so what do I
5 do?
6 Okay. Let me tell you what happened.
7 1 guess you've got to change the tape? Okay.
8 Okay. So here I am over there, I'm working
9 on... I showed you the one that had the Florentine finish,
10 the one painting that I said I started and I didn't finish.
11 Believe me, that technique is an advanced technique. It's
12 very refined and high-minded. It would go with a name like
13 "wellborn," but he pronounces it ""will burn."
14 All right. So I look at that. I knew that there
15 was going to be a problem, so I quit painting. On those
16 paintings that I showed you with a beautiful Florentine
17 surfaces. Man, I'd taken it right up to the peak. That's
18 good, good, high-quality stuff. I just stopped painting. I
19 couldn't go on. The guy had defrauded me. He had me sign
20 blank undated checks, endorse them. He had failed on paying
21 my attorney bill from David Newren, which was $1700 to $1800
22 that he promised he would before I ever sent the art out.
23 He just p1crewed me over right down the line, just to get the
24 art, out of pure greed.
25 And I feel so stupid. I feel stupid to even tell

Page 63

1 you this because it's happened over and over. And that
2 wasn't the last time. This last guy I was dealing with did
3 the same thing to me.
4 Who was that?
5 A: It wasn't Lennie Lumpkin. That's David Newren in
6 the book. Artie says you asked'her who Lennie Lumpkin was.
7 Lennie Lumpkin, in my autobiography, is David.
8 Gene Malone. Gene Malone, M-A-L-O-N-E. Mal one.
9 Bad disposition guy.
10 Q: He also,took your art work?
11 A: Yeah. Let me tell you the story. He said, "Oh,
12 put it in my warehouse. You're having problems with
13 Wellborn here. Okay. We'll get the attorney and
14 everything. Put it in the warehouse over here." Okay.
15 Everything all cool.
16 Um, my key doesn't fit here anymore. "Hey,
17 what's going on?" "Oh, we changed the lock on you."
18 Because there's only two people with keys, me and him. But
19 he's changed the lock on me.
20 Q: All-right. Let me make sure
21 A: So then I had to make a big stink after two
22 months and then I got the art back. But he kept 100 pieces,
23 $5 million worth. I need a business guy who's not a thief.
24 Q: Now, so the art work .... just so I know the
25 history. It went to Wellborn's farm or wherever.

Page 64

1 A: We were not -- trailers, semi-trailers.
2 Q: But then later it went over to the other guy. I
3 mean I think you said Wellborn stole your paintings.
4 A: Uh-huh.
5 Q: Did he give them back?
6 A: He kept .... Henry Simon, the famous Fort Worth
7 Henry Simon, the big Henry Simon, whose father was the other
8 big Henry Simon...
9 Q: Famous in what way?
10 A: Real estate, heavy real estate, and a big
11 attorney right across from the courthouse. He's right
12 there. A public ... well, anyway, he got him. He's been his
13 attorney for a while. Keep in mind that Wellborn...
14 Q: Wellborn's attorney?
15 A: That's Wellborn's attorney. Henry Simon. So he
16 got ... he was worth $40 million or $50 million, started
17 losing his money, and then Wellborn took his money, he told
18 me that he split his money up and gave each one of his
19 children a million dollars in their account and put the
20 other stuff in his wife's name. Took everything out of his
21 name so nobody could get it.
22 Now, the property and everything is in his wife's
23 name and,he owns all these corporations, these Global this,
24 Global that, Global, Global, Global. All these
25 corporations ... I thought there was only one Global. It

Page 65

1 turns out there's six of them. And he had all six of them.
2 I mean this guy is really a scan artist.
3 Q: Who is this, Simon?
4 A: Ronald Wellborn.
5 Q: Ronald Wellborn. He's the guy that's got all
6 the
7 A: Yeah. Now, he's got 2500 of them. Geez
8 Q: 2500
9 A: I feel bad about this, you know. I mean the
10 anger and the rage inside of me is extreme. The only reason
11 1 haven't done anything violent, even though a lot of the
12 circumstances warrant it, is because I'm a good citizen, as
13 best as I can be. And I do not believe in doing this type
14 of stuff. And if I have to take a beating and lose my
15 art ... see, here I am, I'm talking about it. I don't even
16 care about it in the future.
17 You know, what excites me? I mean I'm combing
18 over the past now, and the past is just a bunch of burnt
19 embers. And hels~going to go out there. He's ripped me
20 off. He thinks he's ripped me off. He works for me now.
21 He'll work for me the rest of his life as long as he's got
22 those paintings. He obviously is trying to get his.money
23 out of them.
24 But I still feel burnt. You know, I don't know
25 if I'm giving you the wrong idea, but you have to

Page 66

1 understand, there's a senior and a junior viewpoint. The
2 junior viewpoint is that he ripped me off. The senior
3 view pointis that I hired him and paid him for the rest of
4 hi-s life until he dies. He has to work for me.
5 Now, I don't know which one is the truth, but I'd
6 prefer to look at the ... he did rip me off, but I do prefer
7 to look at the other one ... what is that, 2500. That's how
8 many 20 by 30-inch paintings that-guy stole from me.
9 Q: , So you never got them back.
10 A: No. He's still got them, and the attorneys took
11 800 of them. And not one of those guys has paid one cent
12 for certification. They all have invalid certification.
13 And until they go through the Banker Art Museum, that
14 painting they've got is junk. And furthermore, Terry Neal
15 has got $20 million worth of my art and I haven't got
16 nothing from it. And he's a criminal thief in the same
17 order that these other guys.
18 And the biggest greatest highest minded thing
19 that Terry Neal came up wit h was how to come up with the IOU
20 to cheat people. It's called a "due bill." All right? And
21 he's a genius in these due bills. And he's so smart. You
22 know what he figured out? He figured out that all the stock
23 was and all the money was and all his paper were was due
24 bills, IOUs. And he didn't really have to ever really honor
25 it. He just put it out.

Page 86

1 to do them and I'm the one that invented the technique,
2 after a huge amount of research. But the guys are out there
3 pretending that the Banker Art Museum has sanctioned and
4 authorized thi-s appraisal. Not one of these things is
5 supposed to be out. You could probably say there's a dozen
6 of these that were supposed to be out that actually
7 something really right happened. Every single other one,
8 all the ones that Wellborn has based ... the way that they
9 obtained these things was fraudulent.

Page 99

16 Anyway, I went and I told him which pieces
17 weren't good and gave him a good run down on what it was,
18 because Wellborn had gone and ran off with all the stuff and
19 was pretending it was worth all this and it wasn't worth
20 that much, you see. So I had to notify the appraiser...
21 Q: Did you ever see any of his appraisals,~ Ed Alba's
22 appraisals or...
23 A:- I saw a couple. Oh, oh, okay. Well, a part
24 of ... geez, I get into these situations. Okay. So Wellborn,
25 he goes and he steals my stuff, but just before he does, I

Page 100

1 notice that he has ordered appraisals for all this stuff,
2 and we're talking about boxes full, and these are
3 independent single things. One page for each painting. it
4 looked like it was right off the computer, all.I did was put
5 in the name of the thing. And then over here, this other
6 pad you stamp onto it and it says all its credentials. And
7 1 said, oh, my golly. And I'm thinking, well, you know, how
8 much do these appraisals cost a piece.
9 Well, he worked out a deal with him for probably
10 five bucks or something. Five bucks a piece or a couple of
11 bucks or something for the whole box of them, so he ran the
12 whole thing off.
13 Now, then all of a sudden, as soon as he's got
14 these appraisals, he runs me off the property at gun point,
15 you know. And then I called the cops and everything. And
16 then I find out...I get these rinky-dink attorneys that are
17 just ... enough of that.
18 Anyway, I end up not getting anything. I said,
19 "1 want a half of the appraisals. I have a right to get
20 half." I didn't get any of those appraisals at all.
21 Q: From Alba?
22 A: The attorneys ... well, the attorneys pick them out
23 and kept-them for themselves.
24 Q: Now, these were the appraisals that were done by
25 the National Institute of Appraisers?

Page 101

I A: Yeah. For Wellborn.
2 Q: For Wellborn.
3 A: Wellborn.
4 Q: Did you look at those appraisals?
5 A: I never saw them.
6 Q: You never saw them.
7 A: No., I never saw them. All I knew was somebody
8 told me there was a box of them this big full. I said,
9 "Well, I want some." I think it was the attorneys who told
10 me, "Oh, he's got a box this big of them." "Oh, does he?"
11 Q: All right. I'm going to hand you something to
12 look at. The first one I'm going to hand you... this is an
13 appraisal that was prepared for Itex Corporation by the
14 National Institute of Appraisers. It's identified as
15 Exhibit 14. And attached to this appraisal are some work
16 sheets that were produced in connection with the appraisal.
17 Some of the documents that are attached to the appraisal and
18 the work sheets appear to be out of the Bankers Art Museum.
19 A: Uh-huh.

(more pages about fraudulent artworks, bogus appraisals by the same company providing valuations for artworks being offered in 2022. Also more dubious characters, fictitious names and crazy dealings)

Page 159

2 Q: Okay. This art show that was held at the Milan
3 Gallery.
4 A: Uh-huh.
51 Q: Do you know anything about that?
6 A: I wasn't invited and I didn't go, and I'm so
7 embarrassed about it because all the paintings that were
8 displayed, none of them were by me.
9 Q: How do you know that?
10 A: I know what was in there. These were paintings
11 that Dave Newren ... okay. Dave used to take like $20 million
12 at a pop and he ... now, I'm not ... keep in mind, everything
13 I'm telling you is what I think. I might be dead wrong
14 about this. But what I think and what I knew... okay. Sky
15 Scientific in Southern Florida, he moved a bunch of millions
16 of art work to them, a great big chunk. AIN.
17 Q: How do you know that? What do you know about
18 Sky...
19 A: Because he shipped them off.
20 Q: Oh, he shipped them to Sky Scientific?
21 A: Yeah. He shipped them to Sky Scientific. He
22 shipped the stuff that was at the Milan Gallery to AIN,
23 American-Independent Network, a TV cable network here, that
24 goes all over the United States. $20 million worth of the
25 stuff. AIN contacted the Milan Gallery...

Page 160

1 Q: Who contacted ..... just for clarification, when you
2 say $20 million worth of the stuff, you're referring to $20
3 million worth of art work?
4 A: Yeah.
5 Q: Your work?
G A: Yeah.
7 Q: Okay.
8 A: Yeah. He shipped off $20 million worth of art
9 work to AIN and they were supposed to give us TV advertising
10 time, which, of course, you know, Artie got that and she
11 took it and tried to set somebody up, and they came in there
12 and undercut her and wouldn't do it, and cheated her and
13 everything else. And I guess she's handling it okay now,
14 and she's trying to get ... apparently they're running some
15 ads or something now she said.
16 But it's a problem. I won't even go talk to
17 these people. I've never talked to Sky Scientific. I've
18 never talked to one person in AIN. I've never talked to
19 Terry Neal. I've never talked to any of those guys that are
20 doing that, because, you know, they're off my purpose.
21 Q: So this art work that was displayed at the Milan
22 Gallery was not your art work?
23 A: Well, it was done under my direction but it
24 wasn't completed under my direction. I broke my leg in
25 Thailand before I ... when I came back and the did the

Page 161

1 sculpture. I broke my leg. And I broke the ball in my hip
2 off the femur, okay. Bone. We were out in the jungle kind
3 of, and it took three days to get.into Bangkok to a
4 hospital. It was a miserable thing. And when I got back to
5 the United States that ended off right there. There was
6 no more painting. Artie went in. She packed all the stuff
7 up and shipped it back to the United States.
8 After it got back to the United States, Dave
9 Newren went through the stuff, packaged up stuff and shipped
10 it off to different locations that he had been working on,
11 because he wasn't I was in Thailand for six months, and he
12 was only there he was there for about two months or
13 something and came back here. So he had a four-month run
14 saying, "Well, the stuff is coming in," you know.
15 So he went and he packaged the stuff up and I
16 mean these were big paintings. Six foot by four foot, you
17 know, and like that. 51 inches by six-foot-four, and stuff
18 like that. Plus probably some small ones too.
19 Those paintings ended up .. I was surprised at how
20 many there were, you know, the big ones. But there he had
21 the Milan Gallery now. A lot of them down in the basement.
22 They have a vault down there with a big wheel and everything
23 and they take people down in the vault and show them the Sky
24 Jones paintings. And that's the only art work that I know
25 that's in the vault down there.

Page 162

1 And the paintings that were displayed ... the show
2 was put on without me even being invited, nobody giving me a
3 ticket to it. And I didn't get one thing out of it. Not
4 one thing out of that show. And the only thing that came
5 out of it, was Ronald Welborn, and he called and said, 110h,
6 1 like your stuff," and he apparently picked up a couple of
7 paintings.
8 But according to Tal, 80 or 90 percent of the
9 pieces sold, and over half the pieces sold the first night.
10 That probably means barter. The article said, you know,
11 that's probably what it meant. That was $5 million worth,
12 the night of the opening.
13 Q: And how do you know this? Is this based on
14 A: Tal Milan told me that, the owner of the gallery.
15 Q: He told you that?
16 A: Yes. And it's also printed in Decor magazine.
17 Q: But you don't have any firsthand knowledge
18 A: I wasn't there. You know, I wasn't there.
19 Q: okay.
20 A: I wish I would have been. Finally when I met
21 Tal, he's complaining about this and that. I said, "Well,
22 look, let me give you this painting here. It'll help solve
23 any of the hard feelings you have about not having been
24 paid, this and that." He had a problem with the framer. I
25 gave him a painting out of goodwill, and that was the only

Page 163

1 stuff I've done.
2 Now, Artie handles all that type of stuff. I
3 don't even want to see it, you know, because she's in charge
4 of any galleries and so forth.
5 Tal didn't know that the paintings .. that none of
6 the paintings were by me, that they were all done by my
7 assistants under my direction. Since he found out, he just
8 about had a heart attack. He said, "Don't tell me that-" I
9 said, "Well, you know, they were done under my direction.
10 Do you think Leroy Neiman does all his prints himself?"
11 Everybody knows he doesn't. Do you think Andy Warhol does
12 any of his?" No, he doesn't do it all. He's got people
13 doing them, under their direction.
14 But he said, "Well, I would like to have a show
15 of the stuff that you have painted while you've been here in
16 Fort Worth." And Artie is currently establishing... setting
17 up that show, and they'll print up some posters, you know,
18 do the whole routine. gut it will be some of these new
19 pieces that I've brought it and showed you.
20 Q: Okay. Now, in your book you mentioned ...... the
21 reference to Lennie Lumpkin is really ... you're talking about
22 David Newren?
23 A: Uh-huh.
24 Q: There's another person
25 A: What's the name?

Page (163 blank) 164

1 Q Dudley
A: Burnass.
3 Q: Burnass.
4 A: These are all a play on words.
5 Q: Who is Dudley Burnass?
6 A: Ron "Will burn."
7 Q: That's Ron Wellborn?
8 A: Uh-huh. Now, I have gone through here and in the
9 autobiography... I haven't finished it. It's 900 pages
10 short. It's at 900 pages right now and I don't know if you
11 have all 900 pages.
12 But can I look at it?
13 Q: Sure.
14 A: Now, this is supposed to ..... Book I and Book II,
15 right? So I haven't seen this Book I and Book II. When I
16 saw it, it was just Book I. It was just one big thing. And
17 1 just want to double-check the back here.
18 Q: Who is typing it for you?
19 A: I typed it all myself.
20 Q: Oh, you did.
21 A: I didn't even do it in a computer. I just typed
22 it up. Okay. Yeah. It looks like you're missing ... yeah,
23 there's a big section missing out of this.
24 Q: Okay. That's fine.
25 A: But it's taken up to a certain point. Okay.