Report: Salem Paid Millions To Settle Suit In Case Of Brokered-Time Host's Ponzi Scheme

Resolution

Documents from a civil lawsuit filed by victims of a Ponzi scheme run by WILLIAM NEIL "DOC" GALLAGHER, an investment advisor who bought time on SALEM News-Talk KSKY-A (660 AM THE ANSWER), SALEM Business KEXB-A, and CRAWFORD Religion-Brokered Talk KAAM-A/DALLAS for his "MONEY DOCTOR" and "THE JOY OF A RICH RETIREMENT" shows and was sentenced to 25 years in prison, indicate that SALEM paid $5.3 million to a court-appointed receiver to settle KSKY's part of the lawsuit and $250,000 to settle KAAM's potential liability, according to a report in the DALLAS MORNING NEWS.

SALEM, KSKY host MARK DAVIS, and retired Contemporary Christian KLTY host FRANK REED, who endorsed GALLAGHER in spots on the stations, were among defendants named in the suit, and SALEM's position in court was that the stations merely sold advertising to GALLAGHER and did not know of his activities. The settlement does not constitute an admission of guilt; the suit, which sought restitution for the victims of GALLAGHER, alleged that SALEM had knowledge that there may have been problems with GALLAGHER's operation but chose not to discontinue their relationship until his indictment.

GALLAGHER is serving three life sentences for the Ponzi scheme, convicted in cases in TARRANT and DALLAS COUNTIES. The scheme took between $19.6 million and $29.2 million from 60 elderly investors in 2014-19, leading to his 2019 arrest.

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