Old Duffers have their uses

Some time ago in response to the vigilantism of shop keepers and home owners in dealing with annoying and or dangerous offenders I wrote a blog, "the thin Blue line" in essence examining the role of law enforcement , the failure of such laws, and the rise in vigilantism, and the possible leap to anarchy.

In Germany last month vigilantism came to the forefront of consciousness in the realm of finance. This is topical, as if the law doesn't protect people from fraud eventually someone will take matters into their own hands. (Another reason why NZX's conflicts need to be resolved.)

Now sure the product of the Nazi Hitler youth that this group is about the right age to have been trained in have a culturally different mindset to little old Hanover investors down here in god zone. But when you have quite possibly hundreds of thousands of investors affected by Blue Chip and finance company collapses many with really bad smells and the consequences for the thieves is bankruptcy - hardly a punishment at all - while they still hold their wealth elsewhere enjoying the high life, and the only reprimand is a short holiday in a pleasant prison somewhere at worst, and at best being barred as  a director for 5 years when the lives of the victims are ruined, then something has got to give.

Surely, there is a small group of really pissed-off investors out of this large pool somewhere in NZ that will find this story an inspiration? Go look at it. http://www.smh.com.au/world/zimmer-frame-gang-tortures-adviser-who-lost-4-million-20090624-cw44.html

Hotchin Watson, Petricevic and others you need to be really scared!

The old duffers  are a product of the 1940s to 1960s and have some old fashioned views and most will remember the 1960s' song of "Freedom is just another word for nothing left to lose..." well nothing left to lose actually redefines your life especially when you are old as you are at last free ..... To do whatever you want.

I often remind banks and creditors when a debtor has nothing left to lose it is now someone else's turn as a way of sobering silly situations up. It is amazing how often banks and creditors use the threat of bankruptcy as some real form of punishment. Hell for most intelligent hard working people it is just a new beginning with a clean slate. Sure they have to at least for a while live within their means. But this in itself is no bad thing.

Back to this story, a German-American financial advisor and head of an investment firm called Digitalglobalnet, a James Amburn, managed to lose his clients a bucket load of money. In fact it looks like he might have managed to lose 100 percent of his clients' money. For him nothing much changed, he still had his personal wealth nicely tucked away in a Swiss bank account, apparently, and was still able to "enjoy a drink at an outdoor café with his friends".

This was too much for a group of his investors who lost $4 million. Perhaps for them this loss meant that they no longer had any quality of life and if they could extort him to pay them back, their lives would be restored and if they failed then living the remainder of their limited life in a jail was more appealing than a dingy rest home or worse under a bridge on an autobahn. It seems that they were misguided as one of the captors of this naughty Amburn, still managed to own a nice beach house on Lake Chiemsee where Amburn was taken for four days of torture.

Amburn on his way home from the café was bashed over the head with a Zimmer frame by two old duffers aged 60 and 74. (The 74 year old might have been in the Hitler Youth he was 10 in 1944, and he may also have been armed in the defence of Germany at the time, yes Hitler's armies included children as young as 10 by the end of the war, so assume he was a tough customer.) They knocked Amburn to the ground....he was left bleeding from his eyes, nose and mouth. Quote Amburn.... "Then they bound me with masking tape until I looked like a mummy. It took them quite a while because they ran out of breath" And, wait for it, this was obviously on a public street and no one came to help him. "When they loaded me into the car I thought I was a dead man." Good I say, he now knows what is feels like to be as good as dead. I always remember one of the more enlightened comments from a financial planner, around 20 years ago at a seminar to take money from the audience: "If it a choice of being dead at age 60 or dead broke, I vote for dead." He would say that of course as he was in his forties at the time and his job was to sell fear so he could make money so he would not be dead broke.

Anyway, back to the story. For four days a group of four including a doctor tortured him until he agreed to pay them from his Swiss bank account.

He finally escaped when they let him out of the cellar for a cigarette break... who ever said smoking wasn't good for you.

Now these old duffers will be up for 15 years each in jail. Assuming the costs of old age care are the same in Germany as here i.e. around $80,000 a year in a hospital, it looks like their kids have saved themselves the best part of $4 million, and they have got their money back and given this guy a nasty scare. Justice German style.

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John   #1   12:18 pm Jul 13 2009

We live in the wild West when it comes to company failures and fraud.

David   #2   12:42 pm Jul 13 2009

Good yarn Bruce, those old codgers are heroes in my book. Justice must be done and seen to be done. My dad has lost a bundle with the finance company crooks, all his liquid wealth gone or at extreme risk, I must pass this on to him.

His reaction has been surprisingly mild given that he fought for his country in WW2 and is usually a feisty old bugger with a well developed sense of right and wrong. It's as if the whole thing has knocked the stuffing out of him.

One in particular makes my blood boil. The reassuring prospectus sent out to investors a few weeks prior to its collapse was, in hindsight, just pure fantasy. I have urged him to take it up with the CC but he thinks it's a waste of time and nothing will be done. His reason; the chairman that signed it of was ex cabinet minister Doug Graham.

Disgusting.

Cheers, David.

John Fouhy   #3   05:03 pm Jul 13 2009

The old codgers are heroes? Quoting:

### Volker Ziegler, chief public prosecutor in nearby Traunstein, said the pensioners were angry because they had invested money in properties in Florida and had lost it all.

"This was black money; they hadn't declared it to the revenue authorities in Germany," he said. ###

I'm not going to defend finance company managers who hide behind limited-liability companies, but this is four guys with a million bucks each that were trying to get rich(er) quick, without troubling the taxman. Innocent, honest investers they were not.

corey s   #4   01:30 pm Jul 14 2009

I have a couple of simple rulz. they havent made me rich yet, but they havent lost me any real wealth either.

# never take financial advice from someone poorer then you.

# never buy finacial products unless the person selling them CAN PROVE that they invest in them personally

# only invest with people that have "skin in the game"

# never invest in something you dont fully understand or with people you dont fully trust.

this may seem a little conservative in approach, but it works for me.

KP   #5   08:26 am Jul 17 2009

Interesting story, but realistically, an isolated incident. The truth is, rich people are paranoid, and whilst normal people are encouraged to save for fear of poverty later on, most rich people feel this fear much more, including their personal safety. The owners of the finance companies do their utmost NOT to associate with the common herd. If someone happened to scare one, the rest would just become more paranoid and up their security.

These people need to feel real fear about going to jail, and for a very long time as an incentive not to rip off their investors.

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