Gary Player teeing off
MARK
He’s one of the top three golfers in history more or less and ah… you’d assume that someone like him wouldn’t ah wouldn’t put his name to something that was not legitimate or you know wasn’t going to work out.
The name of golfing titan Gary Player is caught up in a worldwide stock scam. A company - part of Gary Player’s empire - is being sold by fraudulent stock brokers.
MARK
Part of me ah has always wondered for probably the last year how legitimate the whole thing was actually going to be and uh to a point you accept the fact that you may have lost your entire investment.
Australia is just one of the many countries targeted in this global racket and Gary Player’s name - just one of those being used to sell shares to thousands of Australians by overseas brokers. Ordinary Australian investors are parting with millions of dollars to get a piece of what are touted as cutting edge American companies. But the money seems to vanish.
ANTHONY ELGINDY
You add in a little bit of greed, you add a little bit of urgency into the equation, you can create an environment that you know – you need to act now, and that’s really what it’s all about is getting people to act immediately and to send their money immediately to a significant number of strangers.
Tonight Four Corners goes on the chase - tracking international fraud to try to find where money’s gone, who is behind the scams and if Australian investors will ever see their money again.
Title – “ Beyond The Boiler Room”
Eight weeks ago the ABC’s Bangkok Bureau filmed a raid in which over 80 expatriates were arrested – amongst them ten Australians.
They were engaged in an illegal stockbroking operation: selling shares over the telephone to countries like Australia and New Zealand. On offer – amazing deals on discount shares for those who get in quick. It looked like the classic example of what’s known as a “boiler room”.
The Hollywood movie “the Boiler Room” quite accurately shows how this scam works: a very-mobile call centre defrauds mum and dad investors via telephone sales.
The film recreates the hype of brokers selling shares in companies that don’t exist. It’s based on a sting which has been around in the US for more than 20 years – often mafia controlled. The movie shows many of the tricks used.
Recently, the scam has become more sophisticated. Fraudsters have moved from Long Island to Bangkok and sell shares around the world in companies that do exist. Unfortunately these shares can’t be redeemed and investors’ money disappears. The pitch though remains the same. Here’s a recent recording from a Bangkok boiler room.
Audio from boiler room
This is gunna take less than two minutes. Give me a shot here, I gotta tell you something. Now I’ve been in this business 22 years and the reason for the call, it is more important than anything in the world.
Debbie Ireland from Brisbane is the kind of person they’re calling out of the blue. The boiler room that was raided sold her shares in an American company called Interactive Solutions Corporation.
DEBBIE IRELAND
They called my husband at our business offering us offshore shares which my husband declined initially. However, they kept calling with a deal that was too good to miss out on basically. So they asked us to invest a small amount initially – which we thought couldn’t hurt – which we did.
When you direct debit, the form that they actually sent us back said, you know, that we’ve received your direct debit of whatever money you paid. Then, within a week, you will receive the share certificates and, of course, we didn’t receive them but, at the time, I didn’t think it was a big issue. The first investment was $1,830 and, over a period of the next 6 months, it turned into $76,000.
Mark, who doesn’t want his last name used, also got a call.
MARK
I love my golf. My brother introduced me to golf when I was young.
Q- And as a golfer you certainly would have known the name Gary Player?
Exactly, exactly and that was certainly something that gave me a lot of ah belief in the fact that this would be a good opportunity, uh with a name like that it was certainly reassuring.
Two years ago, Mark was phoned by a man claiming to be from a large broking house in Tokyo. He was offered shares in a company called Gary Player Direct: a business that marketed golfing equipment licensed by the famous golfer. The broker claimed inside information that’d bring financial returns in 60 to 90 days.
MARK
They could give you information that other people didn’t really have access to or give you an opportunity that most people wouldn’t.
Q- So you’d have the inside running on certain shares that the general public wouldn’t have?
Exactly.
Q- And that obviously this would bring for bring greater returns?
Indeed, and you know their returns were often suggested to be in excess of 100, 200% so you know for example, if a stock had been $5, they’d you know guarantee that within sort of 6 to 9 months it was likely to be anywhere from 12 to $15.
The brokers sent glossy brochures with extensive information about Gary Player Direct. Mark also received information about the brokers themselves who go by the name of “the Brinton Group”.
MARK
It all looked pretty legitimate, you know there was pretty comprehensive information, um you know they weren’t pushing for eh a great deal of investment. They followed up with a phone call not long after that and ah and asked whether I was interested and I thought well it looked pretty good and started with it just a small investment to see how it panned out.
He started small but, over six months, the Brinton Group sold him shares costing 100s of thousands of US dollars. They told him Gary Player Direct was listed on the prestigious NASDAQ. It wasn’t: it was being traded on a lesser-known and risky market called the Over The Counter Bulletin Board. But the NASDAQ website displays these bulletin board companies. Mark watched the share price go up and phoned Brinton wanting to sell.
MARK
They were pretty reluctant to do that. They’d assure you that, you know, it would either go up further or - if it went down a little bit further - it was going to bounce back up, so they pushed fairly hard not for you to endeavour to get your money back.
What Mark did not know was that Gary Player Direct was in deep financial trouble - and was already delisted - when Brinton started selling him shares. Gary Player Direct did briefly re-list but the share price was crashing. Mark rang his brokers but was reassured that everything would be OK. A deal was being prepared to transfer his shares into a new Gary Player-named company. Mark bought even more shares.
MARK
Right near the end we were assured that you know even if the stock hits 20 10 cents, don’t sell it because this deal will look after you and eventually it did, it hit 10 cents and ceased trading and ah not long after that I asked for written confirmation of the fact that we would receive a stock in this new company. You know that’s a year and a half ago now so we have to see whether that company actually lists and gives us the opportunity to sell that stock and get our money back.
Mark has been given share certificates in a private US company called Gary Player Golf. The old company has gone. Gary Player’s private company, based in the Virgin Islands tax haven, is the largest shareholder in Gary Player Golf. His son and business manager, Marc Player, is also a substantial shareholder and he’s been chairman. The new company has also sold shares to Brinton to be on-sold internationally. The Players have received 100’s of thousands of dollars in endorsements and consultancy fees from Gary Player Golf. For 18 months, Mark, our Australian investor, has been repeatedly assured that Gary Player Golf will soon list publicly. That’d enable him to sell his shares. The reassurance has come from his brokers – the Brinton Group.
COL PEERAPHAN PREMPOOTI from raid
“Please cooperate with us. We have the court order to come and search the place. This is a joint operation with the Royal Thai Police, the Anti Money Laundering Office, the Department of Labour, the FBI and the Australian Federal Police. Please cooperate with us.
This is the outside world’s first glimpse of the Brinton Group. Following extensive surveillance, on the 26th July the Thais led an international team to raid the Bangkok offices. The brokers were working without permits and all but the leaders, would soon be deported back to England, Ireland, the United States and Australia.
COL PEERAPHAN PREMPOOTI
They were trying to leave the premises because they were afraid, you know… the first batch of the advance team were the plain clothes police but the second batch were the police in uniform carried the guns and everything so they afraid.
Raid Video – US dollars stacking up
Inside, the Thai police found: large amounts of US currency; sales pitch scripts; warnings about Australian investors who should not to be called any more; fake company names on the plaque outside; a pile of share certificates for different US companies and detailed instructions on dealing with irate investors.
RAPEE SUCHARITAKUL, ASSISTANT SEC GENERAL, SEC, THAILAND
If the client rings up you know demanding to get the money back there was also instruction that you know to try and calm them down you know lead them on making more investment and then trying not to ah repay the money.
Q- So it seems like they were anticipating some people ringing up and complaining?
Oh yes yes. That’s right yeah mm mm.
Rapee Sucharitakul says his officers seized 200 boxes of evidence which clearly show the Brinton Group - which also goes by other names - was operating an illegal brokerage. What’s more there’s bad news for our Australian investor Mark who thought he was dealing with brokers in Tokyo when he telephoned Brinton.
Rapee
When we raided the office ah on the wall there were different clocks indicating different time zones OK like in Japan. In effect they were actually speaking out of Bangkok but were representing that they were in Japan and had to use the time zone in Japan for example.
Q- What and they’d be talking about oh it’s a lovely day in Tokyo…?
Yes that right. It is now four o’clock in Tokyo now the market is almost coming to a close you know the you know the … was dying down and things like that.
Q- And you have actual evidence of that?
Oh yes yes.
Q-Written evidence?
Right, right, right, right.
We also checked the address offered as Brinton’s Tokyo office. There was no sign of the company there only a message when you call the Tokyo telephone number.
Tokyo answering machine: You’ve reached the Brinton Group. Unfortunately, due to circumstances beyond our control we are currently unable to take your call. We ask for your patience and rest assured all messages will be retrieved in due course. Thank you for calling the Brinton Group.
Police told us they suspect that telephone calls to more-financially-respectable-sounding Tokyo reached a virtual office and were transferred through to Bangkok.
Even here in Bangkok’s business district, it’s difficult hunting down the many boiler rooms. They go by different names – Brinton, for example, is also called Sigama The Australian Securities and Investments Commission warns against dealing with grand sounding companies like: Dreyfuss Securities, Kensington Group, International Asset Management and more than 50 others. As for the shares, Four Corners has identified at least 20 North American companies the boiler rooms are pushing.
This recording selling US companies is from a second Bangkok Boiler room the police raided.
We are bringing on a company which comes on the NASDAQ within less than 90 days. The minimum is six bucks when it comes on the NASDAQ... OK that is the absolute minimum. If it so happens that it comes on an 11 or 15, God bless you, you have made huge.
IRVING EINHORN
You’re gonna see a boiler room pitching a stock in a cutting edge, high-tech company – either some kind of health care, medical products, the new cure for AIDS – it’s always something new, something exciting, something on the cutting edge so then people hear about it; it sounds exciting to ‘em. Boy that sounds like a good idea.
Audio tape: What we handle is internet gaming - it is a one trillion dollar a year industry.
All I’m saying is I want one chance. I want one vote of confidence. I need you to trust me five per cent: I’ll earn the other 95%. Anyway it’ll be good meeting you, once we… Let’s get some business done.
Anthony Elgindy
The most successful techniques to use in these boiler rooms is a cookie cutter script – a script that’s been formatted, been worked over, that’s been devised in such a manner that ah you overcome all the objections that a person might come up with and you create as much sizzle to the steak as possible, and when you have a significant amount of sizzle, you add in a little bit of greed, you add a little bit of urgency into the equation, you can create a, an environment that you know – you need to act now, and that’s really what it’s all about is getting people to act immediately and to send their money immediately to a significant number of strangers.
Audio tape: I want a firm and definite commitment that if everything is in order OK that you will go to the bank and TT (tele transfer) to our bank, the Bank of America. At that point, get a receipt. Fax that back to me. Let’s go make some money! Yes sir .. oh no, I want you to. Anyway, listen Danny. Good talking to you. Have a good one.
Hangs up) Let’s see what happens. Hey this guy he’s a player. (pause) Did I do it wrong? (laughter)
After many calls and discussions, two Brinton “employees” finally agreed to meet us in a Bangkok hotel to talk about their operation. Irishman Ronan Murray and Englishman Steven Hooper have had their passports confiscated. They await trial for operating an illegal brokerage and fraud. If found guilty they possibly face gaol.
RONAN MURRAY:
There was no boss. No one person ran the company. It’s not like other companies, like I said, where… you know, you’re going to have Coca Cola will have a chairman or CEO, CFO… all of these with numerous vice-presidents. That’s not the way it worked.
Q- Well, who owns it?
Pardon me?
Q- Who owns Brinton?
Pardon?
Q- Who owns Brinton?
Brinton Group is owned by a group of shareholders. And… I’m not at liberty to divulge who the shareholders are.
The man identified by Thai Authorities as the local boss is Australian Scott Fisher.
Four Corners made numerous requests for an interview with Mr Fisher and one was promised. But, the night before we left Thailand, we were told by one of his associates that he’d left Bangkok and wouldn’t be returning till the next day, after we’d left. We were told Mr Fisher had to race “up country” because of urgent family commitments.
That night, when we were out discreetly filming some Bangkok nightlife, who should’ve walked into Patpong Road (the city’s notorious sex show district)? It was none other than the family man himself. It seems Mr Fisher wasn’t “up country” at all. If we’d ever had a chance to interview Scott Fisher we would’ve asked him: why investors can’t sell the shares purchased from his company? Why did he set up in Bangkok to sell US shares to Australians? And, most importantly, who controls the Hong Kong bank accounts that received money from Australian investors?
After Four Corners approached Scott Fisher this night and asked why he wasn’t “up country” as claimed, he declined our invitation for an interview.
There is evidence of where investors’ money goes. Australians think they’re making payments directly to the US companies. In fact, a Brinton employee admitted he was a signatory to a Hong Kong bank account bearing the name of a US company Brinton sold shares in. The police think Brinton controlled the bank accounts receiving the money from Australian investors.
But Brinton protests it’s own legitimacy. The main argument: the actual existence of the US companies they sell.
Ronan Murray:
The fact of the matter is the companies are 100% real. Interactive Solutions, who Edward Tracey works with, has developed software and developed the “Thumb Trax Mouse security system” and have been talking with some of the big casinos in Las Vegas. Um Gary Player golf , Gary Player’s one of the most successful golfers in the world. He’s been here to meet us, he’s played golf with staff and clients and friends, and he’s been to 2 of our Christmas parties.
STEVEN HOOPER
- Sure, he he was making himself available. I mean I’ve had the pleasure of um going round a gold course twice with him. Um… I won’t say I was exactly playing golf. My games more like a croquet player, but he was hitting the ball fairly nicely round the course and he’s been more than supportive. And has met clients, um… and like I said is a few people at the company have had the pleasure of his company round round golf courses.
Q- So there’s no doubt that he’s aware that you’re selling shares?
Ronan:
There’s no doubt whatso-… He’s a 100% aware. I mean, that has to be brought home, I think, right now, simply because, it has been said in the media, on the news, this is a fraud, this is a this is a scam. That’s not correct. Millions of dollars were sent to those companies on a monthly basis. You know… Funds were sent back to clients on a daily basis. And the fact is, Gary Player was here, at our party. He was fully aware that we were dealing with his company.
Q- And you both met him?
Ronan:
Yeah.
Steven:
Oh, yes.
R-
Yeah, I’ve met him on four occasions.
Ronan :
I want to stress the point that it’s important for clients to know. So far, all they’ve heard is that this is a fraud and this is a scam, and the companies don’t exist. But they do. And they’re more than welcome, anybody is more than welcome to fly to the US and visit the companies, and see them.
So that’s exactly what we decided to do.
Entrepreneurial California is the place to find the real companies Brinton sells. Media, communications, and computer businesses are hungry for investment.
Small cap companies dream of a NASDAQ listing but many end up on third and fourth tier trading systems that are not really fully-fledged stock markets at all like the Over The Counter Bulletin Board, and below that, the Pink Sheets.
IRVING EINHORN
It’s the market with the least amount of um integrity in the United States. It’s not a dishonest market, but the companies on there are all small start-up companies – very small assets, little if any revenues and they’re basically high-risk companies. They may not even have audited financials: you know, financial statements that are audited by an accounting firm. So it’s definitely – every pink sheet company is highly speculative and high risk.
Anthony Elgindy
Q-What if a potential investor came to you and said I want to invest in a start-up company that’s on the pink sheets. They say they’ve got a great future?
Great I take ‘em and take their money and throw it in the fireplace. Better chance of getting a little heat off that money – some kind of value.
Q- What you – that’s the – you view the companies on the pink sheets in such low regard?
Utter garbage. Absolute garbage.
James Martin driving – This is really an area of research and development. We’ve got a top university here and it’s a perfect place for incubating new companies.
James Martin wanted some capital for his new company making business software.
He says a lot of start up companies based here wind up being sold by boiler rooms.
James Martin
One of the prime attractions to companies that are sold through the boiler rooms is that they’re the latest and greatest new technologies and the latest and greatest is being developed here in San Louis Obispo.
Martin’s experience shows the world of Pink Sheets and the Over The Counter Bulletin Board is easily diverted into fraud.
A promoter injected $7 and a half million dollars into his company, Berten USA, in exchange for control of the stock, according to Martin. He claims the company was hijacked and its shares sold to Australians through a Bangkok boiler room. The promoter who put up the money is said to be the baby-faced Philippino Amador Pastrana (seen here three years ago). Philippino authorities suspect Pastrana has run 21 boiler rooms. James Martin says he’s learnt how the boiler rooms work.
James Martin
The way they make the money is because they sell more shares than there really are and they don’t issue all the certificates. Even if they issue the certificates, by the time they sell them, they’ve had zero value In other words they didn’t have value in the beginning. It’s all hype in a sense that the shares that were sold um and they don’t have to worry about it later because they’ve lowered the value down to you know 5, 10 cents. So every one’s bought the shares, eh starting at $2 or $3, it goes up to as much as 5 or $10 and then it all of a sudden drops.
Irving Einhorn worked for the US Securities and Exchange Commission for 17 years – Now, as a private lawyer, he defends the people he used to prosecute, including boiler room operators.
IRVING EINHORN
The people that do this, do this as a regular business. They don’t do it with just one company. In other words it’s not that little company – start-up company in the United States that is approaching a boiler room in Thailand to market it’s securities throughout the you know eastern or western hemisphere. That’s not the way it works. It’s a promoter or a group of promoters.
They begin to market the shares that they own, or they bought from the company, through their boiler room, which they usually finance and set up and they keep the boiler room supplied with a steady stream of securities to sell.
Q- So if I’m buying stock in US companies through a boiler room, how much of that money is actually going to the companies, the US companies?
Usually nothing goes to the company. Usually the company sold its stock to the group that’s marketing it for one flat price.
James Martin:
These are the certificates that have my name forged on them. As you can see from the dates… that’s four months after I resigned.
Some US companies take money from boiler rooms then turn a blind eye to what happens with their stock. James Martin wasn’t prepared to do that and pulled the pin on his own company.
James Martin
They thought I would be greedy enough, want the money, shut up, take it, turn the other cheek and try and keep the other company going. Who cares if a few people in Australia are losing money, or in South Africa are losing money. Anywhere else in the world, you know don’t worry about them and I said I could not, I could not build a company knowing that it was off of false gains.
Boiler rooms work, in part, because of a loophole in US law. Shares are sold to Australians under “Regulation S” and can’t be resold in the US for one year.
Irving Einhorn
It buys more time for the promoter to support the price of the stock, to keep the price at that level, to sell more of his shares into the marketplace you know, and to allow the people that he wants to get out – you know if he’s sold it – some people that he wants to be good to, let them get out before he lets you get out.
Anthony Elgindy is also familiar with the tricks employed by boiler rooms. He’s been to gaol for insurance fraud and turned prosecution witness in a stock scam. He knows from experience it’s easy to manipulate the price of small stocks. If kept artificially high in the US, shares can be sold offshore, supposedly at a discount rate.
Anthony Elgindy
People will see a quoted price in an issue and think that that’s the price when in reality it’s nothing but a mirage – a propped up price if you will, that is worthless, you know kind of like a Trojan horse or a paper tiger.
Prices on the Over The Counter Bulletin Board and the Pink sheets are just quotes by American traders who are sometimes in on the scam.
When the one-year wait is over for investors carrying “Regulation S” shares, they might not find any traders to buy.
IRVING EINHORN
The people that make these quotations are only obliged to stand by them for very small amounts of shares for a couple hundred shares. So if somebody came in with a large order to sell 10,000 shares of stock – that’s stock that was selling at $8 – might be down to $3 in 5 minutes time.
We haven’t found a single investor who bought shares from Brinton, for example, who’s been able to sell them.
We went to visit the US companies in which Australians supposedly have shares to ask them what’s going on.
As a private company, Gary Player Golf is not yet trading publicly. Our Australian investor has been promised it will list, so he can finally trade his shares.
We’d called the Gary Player Group asking that somebody explain the relationship between any Gary Player companies and the illegal brokers, the Brinton Group.Nobody from Gary Player returned our calls. So we decided to make a face to face request for an interview.
At Gary Player Golf HQ:
His name is Stephen McDonell from the ABC.
Regarding what?
Regarding… we’d like to speak to her about the company: about the fact that Australian investors have put millions of dollars into the company and we’d like to ask some questions about it.
He wants to know why Australian investors have put millions into the company and they want to know what’s going on.
Can I speak to her?
He wants to talk to you.
We were told to come back in forty minutes and somebody would speak to us.
When we returned we met Ed Tracy – former right hand man for casino king Donald Trump.
ED TRACY . CEO , GARY PLAYER GOLF
Gary Player Golf, formerly known as Gary Player Golf dot com, is the arm of the Gary Player empire that manufactures and markets Gary Player hard goods, meaning, clubs, drivers, putters, so on and so forth.
Q- And so if you you order a club… what, on the telephone or over the net, this is where you get it from?
That’s correct. A part of our focus is on direct sales. Part of it comes through the Internet.
Q- And… what are the roles of Gary Player and Mark Player, the people, in this company here?
OK… Ah Gary Player is the largest um shareholder of the company. Ah Mark Player is the chairman of the board of this company and I function as the CEO.
And, according to Mr Tracy, Gary Player Golf owes its business to investment from shares sold by the Brinton Group.
Ed Tracy
All the business that you see here, starting from zero and growing it into ah over a $3 million a year revenue based business is because of that investment, you know.
If it is a $3 million revenue business, that’d be a massive increase on its first five months. The books we’ve seen, to July 2000, show sales of only $100,000 and a loss of $950,000: that’s after paying the Players $175,000 in endorsement fees.Meanwhile Australians have been buying Gary Player Golf shares from Brinton for up to $10 each – shares that Brinton bought for 50c.
From the evidence we’ve seen, Gary Player’s son, Marc, was involved from the start selling shares to Brinton. But there’s no evidence he knew what the shares were being sold for when he and his father visited the Brinton office in Bangkok.
ED TRACY -
Q- And did Gary Player and Mark Player also go and visit the operations there?
Oh, sure they did. Mark was there… in fact, during my due diligence trip, he paid a visit. He and Mr Player, subsequently were there I believe in January or February. I think Mr Player played golf with ah some clients, some big clients, and maybe some of the brokers, and ah paid a visit to their offices, as well.
Q- Yeah, they said he went to their Christmas party for example?
Um… I know that Mark did. I don’t know that Mr Player did, but Mark Mark certainly did.
Q- So you’ve seen the operations of the Brinton Group, and you’re saying you’re happy with it?
Well… when I say I’ve seen the operations, I’ve been on the trading floor. I I’ve listened to how people sell over the telephone. I’ve talked to them about this company, and what our plans are for the future. Ah, I’ve met with the administrators and the executives of company, and I found them to be not only likeable guys, but ah you know, doing what they’re supposed to do.
Q- What about the fact that when they rang up people, they pretended they were in Tokyo, when really they were in Bangkok?
I don’t have any knowledge of that.
Q- Well, how would you feel to know that ah they did do that? That’s what the authorities are claiming?
I I don’t know if they did or didn’t, so I won’t comment.
I don’t pretend to understand why they’re located in any given place, or why any company necessarily picks their location.
Q- But you never asked yourself that? (No) Why a bunch of ex-pats, based in Thailand would be selling to Australia and New Zealand based in Bangkok? (No)
Q- Didn’t strike you as an attempt to avoid jurisdiction, to avoid scrutiny?
No, I asked tho- ah… in fact, I asked those questions… And both our attorneys, and from our due diligence reports, the the answer was they’re located there because the costs of doing business was low.
We were happy to talk to Ed Tracy because, coincidentally, he’s also involved with another Californian company sold by Brinton: “Interactive Solutions Corporation”. It has no link to any Australian company.Debbie from Brisbane bought shares in this company from Brinton yet she’s failed to get any share certificates out of Interactive Solutions.
Debbie Ireland
I e-mailed them on several occasions and the first two e-mails I got back simply stated that the shares had been sold to a money lender and we’ve actually purchased the shares through a money lender and not through their company.
Ed Tracy
Interactive Solutions is a company that the Brinton Group has raised money for. I’ve joined the board of directors. Um.. the company is ah currently in the process, has just made it’s first retail deal for play for fun um ah internet gaming, so it’s not for real money, it’s play for fun.
Q- So you’re saying that you’re on the board of directors of Interactive Solutions, but… do you hold any other position there?
No.
Q- You’re not the chairman?
No.
Q- It’s funny because…?
Oh, wait a minute… I was elected chairman. I’m sorry. When was that announced?
Despite being the Chairman of Interactive Solutions he couldn’t tell us its share price. Ed Tracy said he didn’t have all the answers regarding the company. That we’d have to go to the CEO for accurate financial information.
Four variously-named boiler rooms have sold Australians shares in Interactive Solutions. We were keen to speak to the company about this. Neither the CEO nor any of its managers returned our calls so we also decided to pay them a visit: Two hours south of LA in the city of Irvine, California.
Stephen:
Well, no evidence here of Interactive Solutions. I suppose we could just have a walk around and see if there’s anyone who’ll talk to us.
Upstairs we found a receptionist who took calls for the company… and a couple of others.
I don’t work for them. I work for three different companies here but I do know we can’t have the cameras and stuff in here.
Q- Do you have a direct number for her that I could call?
No I sure don’t.
We’d driven about 10 kilometres away when we were phoned and told the company’s CEO, Anthony Geisler, would speak to us.
ANTHONY GEISLER, CEO, INTERACTIVE SOLUTIONS CORPORATION
Our ah main collection of products that we just got done producing today is ah Vegas Fever Winner Takes All. Ah, we did this with a publisher Encore Software, which is the ah largest privately held software publisher in the United States, Fortune 500 Company – um, we did this. It’s available in 36,000 retail locations beginning next month.
Q- And what is it?
Um – it’s a basically – a PC based ah Casino Game Product – it has the first ever play for fun sports book, which ah you’re obviously using points when you gamble, but it sends an email list out to friends and family letting them know, hey I’ve laid a billion points on Dallas Cowboys and they’re gonna win. And they have the ability to refute your bet and raise you, and back and forth.
Mr Geisler is holding an empty cardboard box. He said he couldn’t show us the game because it’s in production. The distributor told us the game will be available, making it the only product which Interactive Solutions sells.
Anthony Geisler
Q- Why were shares in your company being sold through Bangkok boiler rooms?
I decline to comment. Are these questions gonna keep going down this way, because I’m gonna get real busy if they, so..?
Q- Well, can I ask you – can you confirm for us that you authorised the sale of shares in your company by Draper Securities, Benson Dupont, Sigama and the Brinton Group?
No, everything that I have to say, is in that press release right there.
Q- Why can’t you tell us that?
No one, no one has been authorised to – you know, we have our press release right there and that’s what I’ve given you, so..
Q- What, you can’t tell me if those companies were authorised to sell shares in your company?
No.
Q- Why not?
Because I decline to comment on all of those things.
Q- But why?
Because I’ve been advised by counsel and as an officer and director of a public corporation I retain counsel in Australia and both in the United States and …..
Q- Why did your counsel say you should not speak about it?
You’d have to interview my counsel for that answer?
Q- But didn’t they give you a reason?
Huh – no, they told me to decline to comment.
Q- Without any reason?
Mmm.
Debbie Ireland
The company that we bought or supposedly bought through (sic) were listed on the NASDAQ which we looked up on a daily basis and the shares did exactly what they said they were going to do and that was increase. So then we got more telephone calls asking us to invest more which, at the time, seemed like a reasonably good idea.
But Interactive Solutions is trading on the highly risky Pink Sheets – not the NASDAQ. Brinton also told us otherwise.
Ronan Murray:
Interactive Solutions is publicly quoted, yes… on the NASDAQ.
Anthony Geisler –
Q- If somebody bought shares in your company ah and they were sold as being traded on the main NASDAQ board, you’d agree that was deception?
Um, I don’t know, I’d have to decline to comment on that right now.
Q- Well, it would be deception though, wouldn’t it?
That might be your opinion, I have no idea.
Q- But wouldn’t it be your opinion?
No. I am not making a comment on that.
Q- So it would be your opinion – if I said to you…?
No, I said I’m not making a comment on it.
Q- I’ll sell you these shares in a company that’s being traded on the main NASDAQ board and it’s not really …
(3rd party interjects – “….. end this interview right now, because you’ve completely got outside the scope of things”
It’s easy for the boiler rooms to mislead investors - suggesting companies are trading on the NASDAQ - because, as a web host, the NASDAQ site features pink sheet companies.
NASDAQ, the United States Securities and Exchange Commission and the NASD (the regulator for all US exchanges) all refused to be interviewed for this programme. It’d be nice to know if they’re comfortable that boiler rooms are using little confusions in the US system to rip-off Australians.
Gary Player also refused to be interviewed. We’re not saying that he was aware of the tactics being employed to sell the shares that bore his name. But you’d expect someone with such a reputation to be more careful about the way his name is used. And, after all, his own private company is the largest shareholder in Gary Player Golf: an entity that owes its capital to an illegal Bangkok boiler room.
Mr Player did issue a statement that said:
The Gary Player Group is deeply concerned about the recent allegations about the alleged activities of the Brinton Group. The allegations that have been printed in the press are alarming and, if true, must be addressed swiftly and appropriately. The Gary Player Group has no knowledge whatsoever of any wrongdoing and, along with the public, awaits the results of the investigation into the Brinton Group’s activities.
ED TRACY
I think anytime there’s negative publicity the unfortunate backlash is that there’s going to be some, some erosion of credibility. And I hope that’s not the case with Mr Player. And we hope it’s not the case with this company.
Ed Tracy says it’ll be another 12 to 14 months before his company lists. Investors will just have to wait and see: and Australian investors, in general, will have to wait to find out what happened to more than $200 million they handed over to the boiler rooms.For one investor it was too much. After losing $750,000 he took his own life. For others it’s only been an expensive lesson.
Mark –
When someone gives you or tells you that you can you know double and triple, quadruple your money in half the time that you could probably do it, part of your head says this has got to be great, and there’s a small part that you know says if it doesn’t sound real, it probably isn’t but um greed’s always a pretty strong factor so you know you generally want to believe that but ah yeah it might be a lesson I come to learn I think.
Debbie Ireland
And, in recent weeks, Brinton has been in touch with Australian investors, assuring them that it’ll soon be back in operation.
Debbie Ireland
If criminal charges can be pursued then I’d like to see them charged because it’s bad enough that people have lost their money but the worst scenario is that they’ll be able to walk around and be able to do it to someone else again.
ends
MARK
He’s one of the top three golfers in history more or less and ah… you’d assume that someone like him wouldn’t ah wouldn’t put his name to something that was not legitimate or you know wasn’t going to work out.
The name of golfing titan Gary Player is caught up in a worldwide stock scam. A company - part of Gary Player’s empire - is being sold by fraudulent stock brokers.
MARK
Part of me ah has always wondered for probably the last year how legitimate the whole thing was actually going to be and uh to a point you accept the fact that you may have lost your entire investment.
Australia is just one of the many countries targeted in this global racket and Gary Player’s name - just one of those being used to sell shares to thousands of Australians by overseas brokers. Ordinary Australian investors are parting with millions of dollars to get a piece of what are touted as cutting edge American companies. But the money seems to vanish.
ANTHONY ELGINDY
You add in a little bit of greed, you add a little bit of urgency into the equation, you can create an environment that you know – you need to act now, and that’s really what it’s all about is getting people to act immediately and to send their money immediately to a significant number of strangers.
Tonight Four Corners goes on the chase - tracking international fraud to try to find where money’s gone, who is behind the scams and if Australian investors will ever see their money again.
Title – “ Beyond The Boiler Room”
Eight weeks ago the ABC’s Bangkok Bureau filmed a raid in which over 80 expatriates were arrested – amongst them ten Australians.
They were engaged in an illegal stockbroking operation: selling shares over the telephone to countries like Australia and New Zealand. On offer – amazing deals on discount shares for those who get in quick. It looked like the classic example of what’s known as a “boiler room”.
The Hollywood movie “the Boiler Room” quite accurately shows how this scam works: a very-mobile call centre defrauds mum and dad investors via telephone sales.
The film recreates the hype of brokers selling shares in companies that don’t exist. It’s based on a sting which has been around in the US for more than 20 years – often mafia controlled. The movie shows many of the tricks used.
Recently, the scam has become more sophisticated. Fraudsters have moved from Long Island to Bangkok and sell shares around the world in companies that do exist. Unfortunately these shares can’t be redeemed and investors’ money disappears. The pitch though remains the same. Here’s a recent recording from a Bangkok boiler room.
Audio from boiler room
This is gunna take less than two minutes. Give me a shot here, I gotta tell you something. Now I’ve been in this business 22 years and the reason for the call, it is more important than anything in the world.
Debbie Ireland from Brisbane is the kind of person they’re calling out of the blue. The boiler room that was raided sold her shares in an American company called Interactive Solutions Corporation.
DEBBIE IRELAND
They called my husband at our business offering us offshore shares which my husband declined initially. However, they kept calling with a deal that was too good to miss out on basically. So they asked us to invest a small amount initially – which we thought couldn’t hurt – which we did.
When you direct debit, the form that they actually sent us back said, you know, that we’ve received your direct debit of whatever money you paid. Then, within a week, you will receive the share certificates and, of course, we didn’t receive them but, at the time, I didn’t think it was a big issue. The first investment was $1,830 and, over a period of the next 6 months, it turned into $76,000.
Mark, who doesn’t want his last name used, also got a call.
MARK
I love my golf. My brother introduced me to golf when I was young.
Q- And as a golfer you certainly would have known the name Gary Player?
Exactly, exactly and that was certainly something that gave me a lot of ah belief in the fact that this would be a good opportunity, uh with a name like that it was certainly reassuring.
Two years ago, Mark was phoned by a man claiming to be from a large broking house in Tokyo. He was offered shares in a company called Gary Player Direct: a business that marketed golfing equipment licensed by the famous golfer. The broker claimed inside information that’d bring financial returns in 60 to 90 days.
MARK
They could give you information that other people didn’t really have access to or give you an opportunity that most people wouldn’t.
Q- So you’d have the inside running on certain shares that the general public wouldn’t have?
Exactly.
Q- And that obviously this would bring for bring greater returns?
Indeed, and you know their returns were often suggested to be in excess of 100, 200% so you know for example, if a stock had been $5, they’d you know guarantee that within sort of 6 to 9 months it was likely to be anywhere from 12 to $15.
The brokers sent glossy brochures with extensive information about Gary Player Direct. Mark also received information about the brokers themselves who go by the name of “the Brinton Group”.
MARK
It all looked pretty legitimate, you know there was pretty comprehensive information, um you know they weren’t pushing for eh a great deal of investment. They followed up with a phone call not long after that and ah and asked whether I was interested and I thought well it looked pretty good and started with it just a small investment to see how it panned out.
He started small but, over six months, the Brinton Group sold him shares costing 100s of thousands of US dollars. They told him Gary Player Direct was listed on the prestigious NASDAQ. It wasn’t: it was being traded on a lesser-known and risky market called the Over The Counter Bulletin Board. But the NASDAQ website displays these bulletin board companies. Mark watched the share price go up and phoned Brinton wanting to sell.
MARK
They were pretty reluctant to do that. They’d assure you that, you know, it would either go up further or - if it went down a little bit further - it was going to bounce back up, so they pushed fairly hard not for you to endeavour to get your money back.
What Mark did not know was that Gary Player Direct was in deep financial trouble - and was already delisted - when Brinton started selling him shares. Gary Player Direct did briefly re-list but the share price was crashing. Mark rang his brokers but was reassured that everything would be OK. A deal was being prepared to transfer his shares into a new Gary Player-named company. Mark bought even more shares.
MARK
Right near the end we were assured that you know even if the stock hits 20 10 cents, don’t sell it because this deal will look after you and eventually it did, it hit 10 cents and ceased trading and ah not long after that I asked for written confirmation of the fact that we would receive a stock in this new company. You know that’s a year and a half ago now so we have to see whether that company actually lists and gives us the opportunity to sell that stock and get our money back.
Mark has been given share certificates in a private US company called Gary Player Golf. The old company has gone. Gary Player’s private company, based in the Virgin Islands tax haven, is the largest shareholder in Gary Player Golf. His son and business manager, Marc Player, is also a substantial shareholder and he’s been chairman. The new company has also sold shares to Brinton to be on-sold internationally. The Players have received 100’s of thousands of dollars in endorsements and consultancy fees from Gary Player Golf. For 18 months, Mark, our Australian investor, has been repeatedly assured that Gary Player Golf will soon list publicly. That’d enable him to sell his shares. The reassurance has come from his brokers – the Brinton Group.
COL PEERAPHAN PREMPOOTI from raid
“Please cooperate with us. We have the court order to come and search the place. This is a joint operation with the Royal Thai Police, the Anti Money Laundering Office, the Department of Labour, the FBI and the Australian Federal Police. Please cooperate with us.
This is the outside world’s first glimpse of the Brinton Group. Following extensive surveillance, on the 26th July the Thais led an international team to raid the Bangkok offices. The brokers were working without permits and all but the leaders, would soon be deported back to England, Ireland, the United States and Australia.
COL PEERAPHAN PREMPOOTI
They were trying to leave the premises because they were afraid, you know… the first batch of the advance team were the plain clothes police but the second batch were the police in uniform carried the guns and everything so they afraid.
Raid Video – US dollars stacking up
Inside, the Thai police found: large amounts of US currency; sales pitch scripts; warnings about Australian investors who should not to be called any more; fake company names on the plaque outside; a pile of share certificates for different US companies and detailed instructions on dealing with irate investors.
RAPEE SUCHARITAKUL, ASSISTANT SEC GENERAL, SEC, THAILAND
If the client rings up you know demanding to get the money back there was also instruction that you know to try and calm them down you know lead them on making more investment and then trying not to ah repay the money.
Q- So it seems like they were anticipating some people ringing up and complaining?
Oh yes yes. That’s right yeah mm mm.
Rapee Sucharitakul says his officers seized 200 boxes of evidence which clearly show the Brinton Group - which also goes by other names - was operating an illegal brokerage. What’s more there’s bad news for our Australian investor Mark who thought he was dealing with brokers in Tokyo when he telephoned Brinton.
Rapee
When we raided the office ah on the wall there were different clocks indicating different time zones OK like in Japan. In effect they were actually speaking out of Bangkok but were representing that they were in Japan and had to use the time zone in Japan for example.
Q- What and they’d be talking about oh it’s a lovely day in Tokyo…?
Yes that right. It is now four o’clock in Tokyo now the market is almost coming to a close you know the you know the … was dying down and things like that.
Q- And you have actual evidence of that?
Oh yes yes.
Q-Written evidence?
Right, right, right, right.
We also checked the address offered as Brinton’s Tokyo office. There was no sign of the company there only a message when you call the Tokyo telephone number.
Tokyo answering machine: You’ve reached the Brinton Group. Unfortunately, due to circumstances beyond our control we are currently unable to take your call. We ask for your patience and rest assured all messages will be retrieved in due course. Thank you for calling the Brinton Group.
Police told us they suspect that telephone calls to more-financially-respectable-sounding Tokyo reached a virtual office and were transferred through to Bangkok.
Even here in Bangkok’s business district, it’s difficult hunting down the many boiler rooms. They go by different names – Brinton, for example, is also called Sigama The Australian Securities and Investments Commission warns against dealing with grand sounding companies like: Dreyfuss Securities, Kensington Group, International Asset Management and more than 50 others. As for the shares, Four Corners has identified at least 20 North American companies the boiler rooms are pushing.
This recording selling US companies is from a second Bangkok Boiler room the police raided.
We are bringing on a company which comes on the NASDAQ within less than 90 days. The minimum is six bucks when it comes on the NASDAQ... OK that is the absolute minimum. If it so happens that it comes on an 11 or 15, God bless you, you have made huge.
IRVING EINHORN
You’re gonna see a boiler room pitching a stock in a cutting edge, high-tech company – either some kind of health care, medical products, the new cure for AIDS – it’s always something new, something exciting, something on the cutting edge so then people hear about it; it sounds exciting to ‘em. Boy that sounds like a good idea.
Audio tape: What we handle is internet gaming - it is a one trillion dollar a year industry.
All I’m saying is I want one chance. I want one vote of confidence. I need you to trust me five per cent: I’ll earn the other 95%. Anyway it’ll be good meeting you, once we… Let’s get some business done.
Anthony Elgindy
The most successful techniques to use in these boiler rooms is a cookie cutter script – a script that’s been formatted, been worked over, that’s been devised in such a manner that ah you overcome all the objections that a person might come up with and you create as much sizzle to the steak as possible, and when you have a significant amount of sizzle, you add in a little bit of greed, you add a little bit of urgency into the equation, you can create a, an environment that you know – you need to act now, and that’s really what it’s all about is getting people to act immediately and to send their money immediately to a significant number of strangers.
Audio tape: I want a firm and definite commitment that if everything is in order OK that you will go to the bank and TT (tele transfer) to our bank, the Bank of America. At that point, get a receipt. Fax that back to me. Let’s go make some money! Yes sir .. oh no, I want you to. Anyway, listen Danny. Good talking to you. Have a good one.
Hangs up) Let’s see what happens. Hey this guy he’s a player. (pause) Did I do it wrong? (laughter)
After many calls and discussions, two Brinton “employees” finally agreed to meet us in a Bangkok hotel to talk about their operation. Irishman Ronan Murray and Englishman Steven Hooper have had their passports confiscated. They await trial for operating an illegal brokerage and fraud. If found guilty they possibly face gaol.
RONAN MURRAY:
There was no boss. No one person ran the company. It’s not like other companies, like I said, where… you know, you’re going to have Coca Cola will have a chairman or CEO, CFO… all of these with numerous vice-presidents. That’s not the way it worked.
Q- Well, who owns it?
Pardon me?
Q- Who owns Brinton?
Pardon?
Q- Who owns Brinton?
Brinton Group is owned by a group of shareholders. And… I’m not at liberty to divulge who the shareholders are.
The man identified by Thai Authorities as the local boss is Australian Scott Fisher.
Four Corners made numerous requests for an interview with Mr Fisher and one was promised. But, the night before we left Thailand, we were told by one of his associates that he’d left Bangkok and wouldn’t be returning till the next day, after we’d left. We were told Mr Fisher had to race “up country” because of urgent family commitments.
That night, when we were out discreetly filming some Bangkok nightlife, who should’ve walked into Patpong Road (the city’s notorious sex show district)? It was none other than the family man himself. It seems Mr Fisher wasn’t “up country” at all. If we’d ever had a chance to interview Scott Fisher we would’ve asked him: why investors can’t sell the shares purchased from his company? Why did he set up in Bangkok to sell US shares to Australians? And, most importantly, who controls the Hong Kong bank accounts that received money from Australian investors?
After Four Corners approached Scott Fisher this night and asked why he wasn’t “up country” as claimed, he declined our invitation for an interview.
There is evidence of where investors’ money goes. Australians think they’re making payments directly to the US companies. In fact, a Brinton employee admitted he was a signatory to a Hong Kong bank account bearing the name of a US company Brinton sold shares in. The police think Brinton controlled the bank accounts receiving the money from Australian investors.
But Brinton protests it’s own legitimacy. The main argument: the actual existence of the US companies they sell.
Ronan Murray:
The fact of the matter is the companies are 100% real. Interactive Solutions, who Edward Tracey works with, has developed software and developed the “Thumb Trax Mouse security system” and have been talking with some of the big casinos in Las Vegas. Um Gary Player golf , Gary Player’s one of the most successful golfers in the world. He’s been here to meet us, he’s played golf with staff and clients and friends, and he’s been to 2 of our Christmas parties.
STEVEN HOOPER
- Sure, he he was making himself available. I mean I’ve had the pleasure of um going round a gold course twice with him. Um… I won’t say I was exactly playing golf. My games more like a croquet player, but he was hitting the ball fairly nicely round the course and he’s been more than supportive. And has met clients, um… and like I said is a few people at the company have had the pleasure of his company round round golf courses.
Q- So there’s no doubt that he’s aware that you’re selling shares?
Ronan:
There’s no doubt whatso-… He’s a 100% aware. I mean, that has to be brought home, I think, right now, simply because, it has been said in the media, on the news, this is a fraud, this is a this is a scam. That’s not correct. Millions of dollars were sent to those companies on a monthly basis. You know… Funds were sent back to clients on a daily basis. And the fact is, Gary Player was here, at our party. He was fully aware that we were dealing with his company.
Q- And you both met him?
Ronan:
Yeah.
Steven:
Oh, yes.
R-
Yeah, I’ve met him on four occasions.
Ronan :
I want to stress the point that it’s important for clients to know. So far, all they’ve heard is that this is a fraud and this is a scam, and the companies don’t exist. But they do. And they’re more than welcome, anybody is more than welcome to fly to the US and visit the companies, and see them.
So that’s exactly what we decided to do.
Entrepreneurial California is the place to find the real companies Brinton sells. Media, communications, and computer businesses are hungry for investment.
Small cap companies dream of a NASDAQ listing but many end up on third and fourth tier trading systems that are not really fully-fledged stock markets at all like the Over The Counter Bulletin Board, and below that, the Pink Sheets.
IRVING EINHORN
It’s the market with the least amount of um integrity in the United States. It’s not a dishonest market, but the companies on there are all small start-up companies – very small assets, little if any revenues and they’re basically high-risk companies. They may not even have audited financials: you know, financial statements that are audited by an accounting firm. So it’s definitely – every pink sheet company is highly speculative and high risk.
Anthony Elgindy
Q-What if a potential investor came to you and said I want to invest in a start-up company that’s on the pink sheets. They say they’ve got a great future?
Great I take ‘em and take their money and throw it in the fireplace. Better chance of getting a little heat off that money – some kind of value.
Q- What you – that’s the – you view the companies on the pink sheets in such low regard?
Utter garbage. Absolute garbage.
James Martin driving – This is really an area of research and development. We’ve got a top university here and it’s a perfect place for incubating new companies.
James Martin wanted some capital for his new company making business software.
He says a lot of start up companies based here wind up being sold by boiler rooms.
James Martin
One of the prime attractions to companies that are sold through the boiler rooms is that they’re the latest and greatest new technologies and the latest and greatest is being developed here in San Louis Obispo.
Martin’s experience shows the world of Pink Sheets and the Over The Counter Bulletin Board is easily diverted into fraud.
A promoter injected $7 and a half million dollars into his company, Berten USA, in exchange for control of the stock, according to Martin. He claims the company was hijacked and its shares sold to Australians through a Bangkok boiler room. The promoter who put up the money is said to be the baby-faced Philippino Amador Pastrana (seen here three years ago). Philippino authorities suspect Pastrana has run 21 boiler rooms. James Martin says he’s learnt how the boiler rooms work.
James Martin
The way they make the money is because they sell more shares than there really are and they don’t issue all the certificates. Even if they issue the certificates, by the time they sell them, they’ve had zero value In other words they didn’t have value in the beginning. It’s all hype in a sense that the shares that were sold um and they don’t have to worry about it later because they’ve lowered the value down to you know 5, 10 cents. So every one’s bought the shares, eh starting at $2 or $3, it goes up to as much as 5 or $10 and then it all of a sudden drops.
Irving Einhorn worked for the US Securities and Exchange Commission for 17 years – Now, as a private lawyer, he defends the people he used to prosecute, including boiler room operators.
IRVING EINHORN
The people that do this, do this as a regular business. They don’t do it with just one company. In other words it’s not that little company – start-up company in the United States that is approaching a boiler room in Thailand to market it’s securities throughout the you know eastern or western hemisphere. That’s not the way it works. It’s a promoter or a group of promoters.
They begin to market the shares that they own, or they bought from the company, through their boiler room, which they usually finance and set up and they keep the boiler room supplied with a steady stream of securities to sell.
Q- So if I’m buying stock in US companies through a boiler room, how much of that money is actually going to the companies, the US companies?
Usually nothing goes to the company. Usually the company sold its stock to the group that’s marketing it for one flat price.
James Martin:
These are the certificates that have my name forged on them. As you can see from the dates… that’s four months after I resigned.
Some US companies take money from boiler rooms then turn a blind eye to what happens with their stock. James Martin wasn’t prepared to do that and pulled the pin on his own company.
James Martin
They thought I would be greedy enough, want the money, shut up, take it, turn the other cheek and try and keep the other company going. Who cares if a few people in Australia are losing money, or in South Africa are losing money. Anywhere else in the world, you know don’t worry about them and I said I could not, I could not build a company knowing that it was off of false gains.
Boiler rooms work, in part, because of a loophole in US law. Shares are sold to Australians under “Regulation S” and can’t be resold in the US for one year.
Irving Einhorn
It buys more time for the promoter to support the price of the stock, to keep the price at that level, to sell more of his shares into the marketplace you know, and to allow the people that he wants to get out – you know if he’s sold it – some people that he wants to be good to, let them get out before he lets you get out.
Anthony Elgindy is also familiar with the tricks employed by boiler rooms. He’s been to gaol for insurance fraud and turned prosecution witness in a stock scam. He knows from experience it’s easy to manipulate the price of small stocks. If kept artificially high in the US, shares can be sold offshore, supposedly at a discount rate.
Anthony Elgindy
People will see a quoted price in an issue and think that that’s the price when in reality it’s nothing but a mirage – a propped up price if you will, that is worthless, you know kind of like a Trojan horse or a paper tiger.
Prices on the Over The Counter Bulletin Board and the Pink sheets are just quotes by American traders who are sometimes in on the scam.
When the one-year wait is over for investors carrying “Regulation S” shares, they might not find any traders to buy.
IRVING EINHORN
The people that make these quotations are only obliged to stand by them for very small amounts of shares for a couple hundred shares. So if somebody came in with a large order to sell 10,000 shares of stock – that’s stock that was selling at $8 – might be down to $3 in 5 minutes time.
We haven’t found a single investor who bought shares from Brinton, for example, who’s been able to sell them.
We went to visit the US companies in which Australians supposedly have shares to ask them what’s going on.
As a private company, Gary Player Golf is not yet trading publicly. Our Australian investor has been promised it will list, so he can finally trade his shares.
We’d called the Gary Player Group asking that somebody explain the relationship between any Gary Player companies and the illegal brokers, the Brinton Group.Nobody from Gary Player returned our calls. So we decided to make a face to face request for an interview.
At Gary Player Golf HQ:
His name is Stephen McDonell from the ABC.
Regarding what?
Regarding… we’d like to speak to her about the company: about the fact that Australian investors have put millions of dollars into the company and we’d like to ask some questions about it.
He wants to know why Australian investors have put millions into the company and they want to know what’s going on.
Can I speak to her?
He wants to talk to you.
We were told to come back in forty minutes and somebody would speak to us.
When we returned we met Ed Tracy – former right hand man for casino king Donald Trump.
ED TRACY . CEO , GARY PLAYER GOLF
Gary Player Golf, formerly known as Gary Player Golf dot com, is the arm of the Gary Player empire that manufactures and markets Gary Player hard goods, meaning, clubs, drivers, putters, so on and so forth.
Q- And so if you you order a club… what, on the telephone or over the net, this is where you get it from?
That’s correct. A part of our focus is on direct sales. Part of it comes through the Internet.
Q- And… what are the roles of Gary Player and Mark Player, the people, in this company here?
OK… Ah Gary Player is the largest um shareholder of the company. Ah Mark Player is the chairman of the board of this company and I function as the CEO.
And, according to Mr Tracy, Gary Player Golf owes its business to investment from shares sold by the Brinton Group.
Ed Tracy
All the business that you see here, starting from zero and growing it into ah over a $3 million a year revenue based business is because of that investment, you know.
If it is a $3 million revenue business, that’d be a massive increase on its first five months. The books we’ve seen, to July 2000, show sales of only $100,000 and a loss of $950,000: that’s after paying the Players $175,000 in endorsement fees.Meanwhile Australians have been buying Gary Player Golf shares from Brinton for up to $10 each – shares that Brinton bought for 50c.
From the evidence we’ve seen, Gary Player’s son, Marc, was involved from the start selling shares to Brinton. But there’s no evidence he knew what the shares were being sold for when he and his father visited the Brinton office in Bangkok.
ED TRACY -
Q- And did Gary Player and Mark Player also go and visit the operations there?
Oh, sure they did. Mark was there… in fact, during my due diligence trip, he paid a visit. He and Mr Player, subsequently were there I believe in January or February. I think Mr Player played golf with ah some clients, some big clients, and maybe some of the brokers, and ah paid a visit to their offices, as well.
Q- Yeah, they said he went to their Christmas party for example?
Um… I know that Mark did. I don’t know that Mr Player did, but Mark Mark certainly did.
Q- So you’ve seen the operations of the Brinton Group, and you’re saying you’re happy with it?
Well… when I say I’ve seen the operations, I’ve been on the trading floor. I I’ve listened to how people sell over the telephone. I’ve talked to them about this company, and what our plans are for the future. Ah, I’ve met with the administrators and the executives of company, and I found them to be not only likeable guys, but ah you know, doing what they’re supposed to do.
Q- What about the fact that when they rang up people, they pretended they were in Tokyo, when really they were in Bangkok?
I don’t have any knowledge of that.
Q- Well, how would you feel to know that ah they did do that? That’s what the authorities are claiming?
I I don’t know if they did or didn’t, so I won’t comment.
I don’t pretend to understand why they’re located in any given place, or why any company necessarily picks their location.
Q- But you never asked yourself that? (No) Why a bunch of ex-pats, based in Thailand would be selling to Australia and New Zealand based in Bangkok? (No)
Q- Didn’t strike you as an attempt to avoid jurisdiction, to avoid scrutiny?
No, I asked tho- ah… in fact, I asked those questions… And both our attorneys, and from our due diligence reports, the the answer was they’re located there because the costs of doing business was low.
We were happy to talk to Ed Tracy because, coincidentally, he’s also involved with another Californian company sold by Brinton: “Interactive Solutions Corporation”. It has no link to any Australian company.Debbie from Brisbane bought shares in this company from Brinton yet she’s failed to get any share certificates out of Interactive Solutions.
Debbie Ireland
I e-mailed them on several occasions and the first two e-mails I got back simply stated that the shares had been sold to a money lender and we’ve actually purchased the shares through a money lender and not through their company.
Ed Tracy
Interactive Solutions is a company that the Brinton Group has raised money for. I’ve joined the board of directors. Um.. the company is ah currently in the process, has just made it’s first retail deal for play for fun um ah internet gaming, so it’s not for real money, it’s play for fun.
Q- So you’re saying that you’re on the board of directors of Interactive Solutions, but… do you hold any other position there?
No.
Q- You’re not the chairman?
No.
Q- It’s funny because…?
Oh, wait a minute… I was elected chairman. I’m sorry. When was that announced?
Despite being the Chairman of Interactive Solutions he couldn’t tell us its share price. Ed Tracy said he didn’t have all the answers regarding the company. That we’d have to go to the CEO for accurate financial information.
Four variously-named boiler rooms have sold Australians shares in Interactive Solutions. We were keen to speak to the company about this. Neither the CEO nor any of its managers returned our calls so we also decided to pay them a visit: Two hours south of LA in the city of Irvine, California.
Stephen:
Well, no evidence here of Interactive Solutions. I suppose we could just have a walk around and see if there’s anyone who’ll talk to us.
Upstairs we found a receptionist who took calls for the company… and a couple of others.
I don’t work for them. I work for three different companies here but I do know we can’t have the cameras and stuff in here.
Q- Do you have a direct number for her that I could call?
No I sure don’t.
We’d driven about 10 kilometres away when we were phoned and told the company’s CEO, Anthony Geisler, would speak to us.
ANTHONY GEISLER, CEO, INTERACTIVE SOLUTIONS CORPORATION
Our ah main collection of products that we just got done producing today is ah Vegas Fever Winner Takes All. Ah, we did this with a publisher Encore Software, which is the ah largest privately held software publisher in the United States, Fortune 500 Company – um, we did this. It’s available in 36,000 retail locations beginning next month.
Q- And what is it?
Um – it’s a basically – a PC based ah Casino Game Product – it has the first ever play for fun sports book, which ah you’re obviously using points when you gamble, but it sends an email list out to friends and family letting them know, hey I’ve laid a billion points on Dallas Cowboys and they’re gonna win. And they have the ability to refute your bet and raise you, and back and forth.
Mr Geisler is holding an empty cardboard box. He said he couldn’t show us the game because it’s in production. The distributor told us the game will be available, making it the only product which Interactive Solutions sells.
Anthony Geisler
Q- Why were shares in your company being sold through Bangkok boiler rooms?
I decline to comment. Are these questions gonna keep going down this way, because I’m gonna get real busy if they, so..?
Q- Well, can I ask you – can you confirm for us that you authorised the sale of shares in your company by Draper Securities, Benson Dupont, Sigama and the Brinton Group?
No, everything that I have to say, is in that press release right there.
Q- Why can’t you tell us that?
No one, no one has been authorised to – you know, we have our press release right there and that’s what I’ve given you, so..
Q- What, you can’t tell me if those companies were authorised to sell shares in your company?
No.
Q- Why not?
Because I decline to comment on all of those things.
Q- But why?
Because I’ve been advised by counsel and as an officer and director of a public corporation I retain counsel in Australia and both in the United States and …..
Q- Why did your counsel say you should not speak about it?
You’d have to interview my counsel for that answer?
Q- But didn’t they give you a reason?
Huh – no, they told me to decline to comment.
Q- Without any reason?
Mmm.
Debbie Ireland
The company that we bought or supposedly bought through (sic) were listed on the NASDAQ which we looked up on a daily basis and the shares did exactly what they said they were going to do and that was increase. So then we got more telephone calls asking us to invest more which, at the time, seemed like a reasonably good idea.
But Interactive Solutions is trading on the highly risky Pink Sheets – not the NASDAQ. Brinton also told us otherwise.
Ronan Murray:
Interactive Solutions is publicly quoted, yes… on the NASDAQ.
Anthony Geisler –
Q- If somebody bought shares in your company ah and they were sold as being traded on the main NASDAQ board, you’d agree that was deception?
Um, I don’t know, I’d have to decline to comment on that right now.
Q- Well, it would be deception though, wouldn’t it?
That might be your opinion, I have no idea.
Q- But wouldn’t it be your opinion?
No. I am not making a comment on that.
Q- So it would be your opinion – if I said to you…?
No, I said I’m not making a comment on it.
Q- I’ll sell you these shares in a company that’s being traded on the main NASDAQ board and it’s not really …
(3rd party interjects – “….. end this interview right now, because you’ve completely got outside the scope of things”
It’s easy for the boiler rooms to mislead investors - suggesting companies are trading on the NASDAQ - because, as a web host, the NASDAQ site features pink sheet companies.
NASDAQ, the United States Securities and Exchange Commission and the NASD (the regulator for all US exchanges) all refused to be interviewed for this programme. It’d be nice to know if they’re comfortable that boiler rooms are using little confusions in the US system to rip-off Australians.
Gary Player also refused to be interviewed. We’re not saying that he was aware of the tactics being employed to sell the shares that bore his name. But you’d expect someone with such a reputation to be more careful about the way his name is used. And, after all, his own private company is the largest shareholder in Gary Player Golf: an entity that owes its capital to an illegal Bangkok boiler room.
Mr Player did issue a statement that said:
The Gary Player Group is deeply concerned about the recent allegations about the alleged activities of the Brinton Group. The allegations that have been printed in the press are alarming and, if true, must be addressed swiftly and appropriately. The Gary Player Group has no knowledge whatsoever of any wrongdoing and, along with the public, awaits the results of the investigation into the Brinton Group’s activities.
ED TRACY
I think anytime there’s negative publicity the unfortunate backlash is that there’s going to be some, some erosion of credibility. And I hope that’s not the case with Mr Player. And we hope it’s not the case with this company.
Ed Tracy says it’ll be another 12 to 14 months before his company lists. Investors will just have to wait and see: and Australian investors, in general, will have to wait to find out what happened to more than $200 million they handed over to the boiler rooms.For one investor it was too much. After losing $750,000 he took his own life. For others it’s only been an expensive lesson.
Mark –
When someone gives you or tells you that you can you know double and triple, quadruple your money in half the time that you could probably do it, part of your head says this has got to be great, and there’s a small part that you know says if it doesn’t sound real, it probably isn’t but um greed’s always a pretty strong factor so you know you generally want to believe that but ah yeah it might be a lesson I come to learn I think.
Debbie Ireland
And, in recent weeks, Brinton has been in touch with Australian investors, assuring them that it’ll soon be back in operation.
Debbie Ireland
If criminal charges can be pursued then I’d like to see them charged because it’s bad enough that people have lost their money but the worst scenario is that they’ll be able to walk around and be able to do it to someone else again.
ends