At the beginning, it looked as though it was all going to go wrong. The choppy waters were icy; he was soaked to the skin, and lost. On a moonlit night, he had not thought to pack a chart to lead him back to the spot where he had parked the camper van with $100,000 in getaway money stashed inside, near his luxurious holiday home in nearby Port Stephens. He eventually made it and, filled with regret over his actions, drove to a rest stop where he spent the night.
In the morning, however, he woke up revitalised and started to plan what he was going to do.
For the first few weeks, he stayed at a campsite and then a cheap Sydney hotel. All the while he was following the media coverage of his disappearance, and was surprised to see so much interest being paid to ‘a balding, boring, middle-aged businessman’. Those bland everyman looks, though, provided him with anonymity. He hid in plain sight, doing the things he loved including going to movies, restaurants and the opera. ‘Who’s interested in a middle-aged man in a suit? It’s a wonder wives don’t take the wrong ones home sometimes,’ he said.
Then one day the inevitable happened: he bumped into someone he knew.
‘Aren’t you dead?’ the woman asked.
The silver-tongued fox quickly concocted what would become a reliable cover story — he told her that he had been placed into witness protection. She believed him and Gordon moved smoothly on.
After six weeks, he decided he should tell Sheila that he was not actually dead as she believed. She had been away in Egypt when the ‘accident’ happened and had since, according to Gordon, embraced the role of the gay widow with considerable abandon. He went to their inner-city house in Sydney and left a note for her saying he was outside in the laundry.
When she found him, she was, he would later observe with considerable understatement, very angry. However, he pragmatically reminded her that his businesses were still running profitably and she was enjoying a good income from them, income that would come to an abrupt halt if she reported the ruse. At that moment, Sheila became an accessory to the scheme.
Two months before his pseudo-suicide, Gordon had increased his life insurance by $1 million. Five days after her husband disappeared, Sheila had put in a claim and received $25,000. In July 2001, the coroner declared Gordon dead, despite the lack of a body, which at the time was sipping coffee in Manly and reading about its demise in the paper. Sheila’s solicitor then filed a life-insurance claim for $3.5 million, but AMP’s investigators were suspicious and Sheila decided not to push it. Instead, she and Gordon prudently thought it was time he left the country.
Of course, he could not do that on his old passport. By chance, he met a yachtie in a hotel whose passport was due for renewal. Money exchanged hands and the sailor applied for his new passport with Gordon’s photos. The bland, boring businessman, now going by the name ‘Robert Motzel’, and with blue eyes thanks to contact lenses, passed completely unnoticed through Sydney Airport and flew on to Spain to start a new life running a small hotel.
The plan was for Sheila to follow him after she had sold their assets and gathered together all their cash. When she did eventually turn up, she was, he claimed, awkward and uncomfortable and, more importantly, she had not brought the dough. She left and Gordon, running short on funds, went to, of all places, Wigan in the north of England. Once he had done a little bit of fiddling to get the right documents, he started living the dream as … a quality-control officer in a crisps factory.
For a while his daughter, Josaphine, who had been let in on the secret that her dad was not dead after all, spent time with him in England. Sheila was not quite so forgiving. On a visit to Wigan, she told him: ‘Harry. It’s over! You are the one who f—ed up our marriage with all the shit you brought to it.’
Good point, well made.
It turned out Sheila had found a new man and wanted to get on with her life. Gordon claimed the loss of a relationship with one of the two people that knew he was still alive left him terrified. He decided to return to his homeland, New Zealand, which he had left for the bright lights of Australia 30 years before.
In Auckland, Gordon, still using the alias Robert Motzel, set up a successful career selling garages and doing construction deals on project homes. He was contacted by a social worker called Kristine Newsome who wanted to build a little house on land she had in front of her home on the North Island. Gordon calls red-haired Kristine ‘pixie dust’ because of the magical transformation she performed on his heart. Of course, he did not bother her with any of those awkward little details, like, er, the truth about who he really was. She was given the spiel about being in witness protection and she believed it. They fell in love and agreed to marry, although technically for Harry Gordon that would have been bigamy.
Things were about to get a little tricky.
In May 2005, the lovers were walking hand in hand along the walking track at Mount Maunganui in Tauranga, when Gordon’s older brother, Michael, walked right past them. Michael kept walking and then did a double take. He knew his younger brother was dead — he had spent a lot of time comforting his brother’s widow, Sheila, while she grieved — but he needed to be sure. Turning quickly, he caught up with Gordon and said: ‘Hello, is that really you?’
Cool as a cucumber and painfully aware of his fiancée by his side, Gordon did not flinch. ‘Of course,’ he said with practised ease. ‘But look, it’s not convenient to talk now. I’ll call you in a few days.’
As they walked away, he explained to Kristine that Michael was just an old friend.
Michael flew to Sydney and confronted Sheila, who confessed everything. When she learnt of Gordon’s plans to get married, she went to the police, who made him the subject of a special investigation: Strike Force Rebellion.
Unaware of all this, Gordon and Kristine married, using his false name, and headed to Rarotonga in the Cook Islands for their honeymoon. But when he tried to get back on the plane to return home to New Zealand, Gordon was stopped by the authorities. He was, they pointed out, travelling on a false passport. Gordon was stuck and an extremely distressed Kristine had to fly home alone.
A month later, Gordon had lied and cheated his way back to New Zealand via Fiji on a fake passport and confessed some of the truth to Kristine before boarding a flight on his real passport to confront the authorities in Australia. As soon as he landed, he was arrested. He was allowed a phone call and used it to call Kristine from the police station.
‘She was cross,’ he observed with his customary understatement.
He was tried and sentenced to fifteen months for insurance fraud and false representation, which he served in a low-security prison farm. He spent his time productively writing a book about his exploits called How I Faked My Own Death: The Harry Gordon Story. Sheila got eight months’ home detention for helping him in the fraud. Kristine stuck by her man and they now live happily between her home in New Zealand and his rented house in New South Wales.
Gordon’s advice to anyone else considering running away is simple: ‘Leave a note — that’s the key.’ Faking your death is a problem, he said. ‘Say “I’m going off to start a different life” — there’s nothing wrong with that. There’s nothing wrong with profoundly changing the direction of your life. The problem is deceit. That’s the only issue.’
Nobody’s Fuel: Fuel-saving scams
THE magic pill or mystery device that can save energy and cut fuel bills has been a favourite for scammers for decades. Unfortunately, the promise of cheap petrol and low emissions has burnt many Australian investors, who have found out the hard way that where there is no smoke, there is usually a rogue lighting a fire.
Take, for example, former Sydney real estate salesman Jeffrey Alan Muller. The smooth talker claimed to be best buddies with celebrities including Olivia Newton-John, Ted Turner and John Denver. He was the head honcho behind the old Gold Coast Chargers rugby league team — for just a few weeks, until the franchise was taken away from him when he failed to produce the money to actually go through with t
he deal. By that stage, he had already meddled so badly, bringing in a faith-healer to treat the players among other bungles, that the CEO quit.
Muller had already dabbled in the world of miracle fuel economy — he had promoted an engine that ran on nothing but compressed air! — when he met legendary Australian bush artist Kevin ‘Pro’ Hart by chance on the Gold Coast in 1997. Hart was also a keen Professor Branestawm–style garden-shed inventor. His nickname, Pro, was short for professor. Hart had spent 30 years perfecting his Zero Emission Fuel Saver, a shiny piece of metal the size of a cigarette packet with four holes drilled in it, that would then be fitted in the engine between the intake manifold and the carburettor. Hart happily told Muller how the device cut exhaust emissions to nearly zero and almost halved fuel consumption.
Muller was quick to act. He signed a marketing and manufacturing agreement with Hart, promising him twenty per cent of future profits. Then he bought a shelf company in the US, changed the name to Save The World Air Inc., appointed himself president and sold the company his rights to the device for $1 million plus five million shares. Not bad for someone who paid nothing for the rights in the first place.
Later, Hart denied ever signing the agreement — the signature says Pro Hart, as on his paintings, but on legal documents he always signed with his real name, K.C. Hart. He was appalled at the way his invention was being promoted.
Muller was flying, spruiking the device on Fox Television and in the New York Times. He got his old Hollywood star mate Steven Seagal to endorse the product. ‘I will do everything I possibly can to help promote your company throughout the world to my millions of fans,’ Seagal was quoted as saying in a press release in 2000. ‘Anything that will reduce hydrocarbons in the air and all the horrible emissions that are so toxic to the population of the world, for me is a great blessing. I think that this astounding device is, well, as long as we are using internal combustion engines with gasoline, this is as far as I am concerned the key.’
Motorcycle world champion Barry Sheene, PGA golf maestro Wayne Grady and motor racing legend Jack Brabham also jumped on board to endorse the Zero Emission Fuel Saver. Australian sports minister John Brown wrote: ‘I have never been more impressed over my long life in business and politics with any other venture.’
With that kind of publicity, people could not buy into Save The World Air Inc. quick enough. Shares soared in value from a few cents to $28 each, and Muller, who owned a quarter of the stock, joined the Australian Rich List with a paper wealth of $100 million. He claimed to have sold the first distribution franchise for the Zero Emission Fuel Saver to an autoparts dealer in Jamaica for $4 million, with another 100 franchise sales in the pipeline at $20 million a pop. He was on target for a $2-billion payday. The only problem was that he had not actually made anything. The only Zero Emission Fuel Savers in existence were some prototypes knocked up for him at a Gold Coast auto-wrecking yard.
American Joe Daniels, who at one time had worked as an Elvis impersonator, had taken on the job of managing Save The World Air Inc. in Australia and had moved into Muller’s luxury waterside mansion on the Gold Coast. He was later tracked down by reporter Ben Hills from the Sydney Morning Herald and told Hills that he did not believe Muller ever intended to sell the cheap magnetic devices. ‘Once somebody sees one and holds one in their hand, they can go out and make one in their garage,’ he said. ‘He’s got no product; he’s out there peddling air.’ The whole shaky sham was starting to fall apart.
The fuel saver had also never been independently tested or verified, despite receiving an endorsement from Queensland’s Griffith University, which fell apart under scrutiny from the Herald. On Muller’s website, sports and marketing lecturer Dr Allan Edwards was quoted as saying the device was ‘highly effective’. But when contacted by Hills, Dr Edwards said he had not realised how his friend Muller would use his letter: ‘I was a frightful goose. I’d like to wring his effing neck. I feel used and abused by him.’
An investigation by Stock Patrol on the internet raised the alarm and the share price plummeted. The stunning endorsements Muller had received from celebrities were all retracted. Daniels found his time running the company very busy. ‘I answered the phone and I tried to take care of people’s bitches,’ he said. ‘And 85 per cent had legit bitches; “Where are my shares I paid for?”, “Why can’t I sell my shares?” All day long, every day. They had [bought] something that was worth absolutely nothing.’
In 2005, the US Securities and Exchange Commission’s case against Muller was finally decided in the US District Court in New York. Muller was found to have violated the anti-fraud and reporting provisions of the federal securities laws and was given a permanent injunction, barred for twenty years from serving as a director or officer of a public company, and held liable for $7.5 million in illicit gains — plus interest — and $100,000 in civil penalties.
* * *
Another Aussie who fell foul of the US authorities and, at the time of writing, is avoiding Mr Big in the showers of a Las Vegas jail in Nevada, is Sydney property tycoon Nati Stoliar. He was a former partner of flamboyant stockbroker Rene Rivkin, and mate of Labor powerbroker Eddie Obeid. He once owned the prestigious property Boomerang in Elizabeth Bay, and had even planned to make the $80-million fourth instalment of the Godfather movie series with shopping trolley tycoon and con man Karl Suleman.
But in 2009, it all started to unravel when his company was bankrupted over its failure to deliver on promises to redevelop the iconic TNT towers in Sydney’s inner-city suburb of Redfern. He went to Poland, dabbled in real estate and then moved on to Canada, where he teamed up with property developer James Jariv, who had fled Australia in 2004 owing creditors $6 million for an uncompleted apartment block in Chippendale, also in inner-city Sydney. Stung creditors dubbed the block ‘the nightmare on Regent Street’.
Together these two scoundrels cooked up a scheme to cash in on the market for renewable energy and the American government’s equivalent of the carbon credits scheme.
In Canada, they set up a firm called City Farm Biofuel, which, according to its website, produced biodiesel fuel by reprocessing used vegetable oil. They then claimed to sell this fuel to a company in Las Vegas called Global E Marketing, which was owned by Jariv. But there was no sale. Instead, they instructed tanker drivers to drive backwards and forwards across the border to give the impression they were shipping 4.2 million litres of biodiesel. This generated regulatory information notices, or RINs, which they sold for more than $7 million. At the same time, they falsely sold fuels bought in the US as pure biodiesel, which allowed them to increase the price and enabled buyers to claim green credits. Stoliar and Jariv kept the $30 million worth of RINs generated by the fake biodiesel.
When the law caught up with him in 2015, Stoliar ended up with two years in the big house plus three years’ supervised release. His six-bedroom, six-bathroom house in Henderson, Nevada, was sold under forfeiture for $1,140,000, and among other items he also forfeited was his gold Bulgari chronograph and a diamond tennis bracelet. Jariv himself went down for a ten-year spell.
‘Stoliar and his co-conspirator [James Jariv] perpetrated a massive fraud against a renewable fuels program created to protect our nation’s energy security and independence,’ said Sam Hirsch, acting assistant attorney-general for the Justice Department’s Environment and Natural Resources Division. ‘The Justice Department will continue to pursue fraudsters at home and abroad and protect the integrity of federal programs as it protects the environment.’
* * *
Unbelievably, these fuel-saving scams pale into insignificance when compared with the global con pulled off by Tim Johnston, a Jehovah’s Witness who learnt to sell by preaching the gospel on people’s doorsteps. It was perfect training for a man who, in 1992, came up with the notion of selling people a mere concept with no physical evidence to back it up.
Johnston’s idea was a blue pill that could cut fuel consumption by up to twenty per cent, reduce emissions
and clean the engine at the same time. It worked, he claimed, by burning more of the heavier elements of the fuel, which increased power and fuel economy. This, of course, was complete cobblers — the pill was really made up of old moth balls — and the assertion that just one pill inserted into a 60-litre tank of petrol would make any discernible difference was far-fetched, to say the least. But it is astonishing just how many people, from mum-and-dad investors, right up to the highest levels of government, trade and industry, desperately wanted to believe it.
Johnston started out in New Zealand in 1991 and moved to Australia, making slow steady progress selling his blue pill to investors. By 2006, the con man’s lies had been exposed a number of times. However, cometh the hour, cometh the man. The world was waking up to a global energy crisis. In automobile-loving Australia, every single head of the population was matched by a car or a truck, which collectively slurped up almost 40 billion litres of fuel a year. Now, just imagine a little blue pill that could make your vehicle run longer and cleaner. It was the Viagra of the petrol pump, and Johnston was its supplier.
In December 2004 he started a company called Firepower to market his magic pill. It was actually a complex web of companies that trailed back to a $1 company called Firepower Operations Pty Ltd in the British Virgin Islands that was first registered in 2004. Once Johnston had a few people on board who believed in the product, the Firepower investment story snowballed. Many passed on the tip of the fantastic get-rich-quick scheme to family, friends and workmates. These ‘lucky’ few felt as though they were being welcomed into a secret club, a feeling that prevented many of them from raising the alarm when things started to go wrong. It may have seemed a little too good to be true, but nobody wanted to mention the elephant in the room.
Dirty Rotten Scoundrels Page 8