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Weed Man Guilty of 28 Felony Counts

Chiropractor faces about 25 years in prison over money laundering, fraud

By Jim Schultz
Saturday, June 7, 2008

SACRAMENTO — A 55-year-old Weed man was convicted by a federal jury Thursday of 28 felony counts of money laundering and bankruptcy fraud.

Thomas M. Klassy, a former Weaverville chiropractor, faces up to about 25 years in prison and up to $750,000 in fines.

He is being held without bail at Sacramento County Jail and is set for sentencing Aug. 14. He faces eight to 10 years in federal prison.

A federal grand jury indicted Klassy in 2005 on charges of money laundering, making false declarations and concealing property in a bankruptcy case, said Assistant U.S. Attorney Matthew Stegman.

Klassy was convicted of the felony charges after a three-week trial in U.S. District Court.
Stegman and Assistant U.S. Attorney Russell Carlberg, who both prosecuted the case, said Friday that evidence introduced at trial showed that Klassy committed perjury during bankruptcy proceedings and concealed substantial assets from the bankruptcy court.

Stegman said Klassy lied under oath, claiming that he did not own an airplane, a pickup, a one-third interest in a 220-acre ranch, $205,000 he received for the sale of his chiropractic business and two shell corporations named Rose Ventures Inc. and Aromor Inc., which he used to hide many of his assets, Stegman said.

Klassy said that he sold his chiropractic business for $60,000, but he really sold it for $265,000 and gave a bankruptcy court trustee a forged contract for the lesser amount, Stegman said.

He also was convicted of money laundering for funneling the money he received through the sale of his business through an attorney’s trust account and then back to Rose Ventures Inc. and Aromor Inc. bank accounts, Stegman said.

In a separate state case, Klassy was arrested in April on suspicion of illegally prescribing medical marijuana to patients.

He was charged in Siskiyou County Superior Court with practicing medicine without a certificate and advertising as a doctor without a valid certificate.

His medicinal marijuana case is still pending in Siskiyou County Superior Court, but court documents allege that Klassy also possessed illegal explosives and firearms, including an anti-tank rocket, at his Old Edgewood Road property.

The documents say he also threatened a witness, Caleb Cheyenne Wolfe, then 28, in connection with those alleged crimes.

Klassy has not been charged in those cases, but Wolfe, who lived on Klassy’s property, was arrested along with him in April.

Wolfe was arrested on suspicion of making a destructive device without a permit, possessing a destructive device, possessing fireworks without a permit, possessing a controlled substance and marijuana possession.
Wolfe’s next court appearance is June 19.

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