By Jesse Marx
By Chris Parker
By Jake Rossen
By Jesse Marx
By Michelle LeBow
By Alleen Brown
By Maggie LaMaack
By CP Staff
Bernie Butts couldn't believe his ears. But there it was, a financial opportunity he couldn't turn down: high-paying gold mines.
"My contract with gold mines guarantees 40 percent per month," Jason Meyer said on the other end of the call. "I can promise you 25 percent per month."
It was July 2009. Butts, a personal injury attorney in Miami, knew that Meyer was talking about a rare opportunity, a chance to be a winner in the worst economic slump since the Great Depression.
But the opportunity was limited, Meyer explained. He could take on only a few investors at a time. He didn't bother to explain where these gold mines were located, and Butts wasn't worried about that.
Instead, the lawyer grilled Meyer about his background.
"What is your education?" Butts wrote in an email.
"College graduate," Meyer replied. "Majored in Architecture. I was also big into real-estate investing. I owned a lot of property in Florida and Arizona."
"How did you start in the leverage business?" Butts typed.
"Got introduced to it by a friend of a friend," Meyer wrote back. "He charged me to show the ropes on how he does it."
Word of mouth through friends seemed to be the way these kinds of deals worked. Butts was introduced to Meyer through his friend Richard Oetting, an Orange County developer with a knack for uncovering opportunities and sharing them.
Meyer recommended that Butts talk to A.J. Watson, a client in Michigan who ran a private investment group. When Watson vouched for Meyer, Butts decided it was safe to invest.
At first, the deal was a lot of fun. Meyer and Butts emailed back and forth constantly, building a friendship as they pictured their future wealth. Meyer sent Butts contracts for his vodka-importing business, and as a favor Butts reviewed them.
The men haggled before finally settling on an initial contribution of $1.5 million. Meyer would pay back the start-up money after 30 days, plus $375,000 a month for nine months, for a total profit of nearly $1.9 million.
After the first payment came through, Butts doubled down with Meyer.
Then things got complicated. Meyer said he wanted to keep some of the money longer.
So the men hashed out another contract with even better terms. If Butts invested $5.5 million, he would get all of his money back, plus close to $14.3 million in profits. Butts signed on the dotted line.
Then the payouts dried up. Butts pestered Meyer constantly for his returns, but it seemed like Meyer always had a reason to stall.
Finally, the men agreed to meet in Chicago over the weekend of November 8, 2009, when the Bears played Arizona. Meyer got tickets to the game for Butts and his wife, Peg, and told them that he and his own wife, Jennifer, would be staying at the Hilton.
But when Bernie and Peg arrived in Chicago, they were chagrined to discover that Jason and Jennifer Meyer weren't exactly rooming at a four-star joint.
"They stayed at some fleabag hotel down in the middle of town," Butts says. "And Peggy says to me, 'Bernie, what is with this guy? If he's worth all this money, why doesn't he stay at the Hilton?'"
AS THE JET engines wound down and the plane taxied toward the terminal, R.J. Rice felt his anxiety rising.
It was May 2008, and Rice had started his day at home in Michigan. He'd just landed in Minnesota, and he was worried that this business trip might go badly.
Rice stepped into the bustling hallway at Minneapolis-St. Paul International Airport and followed the signs toward the rental cars. The route to downtown Minneapolis took about 30 minutes, giving him plenty of time to think about what was at stake.
He checked into the hotel, dropped off his luggage, and headed to the restaurant where he was scheduled to meet Jason Meyer.
Meyer was as confident in person as he'd sounded on the phone. He flashed a grin of even white teeth and offered a solid handshake.
Business was booming, Meyer implied. The International Tropical Timber Council, an arm of the United Nations, was still backing the deal. Soon, everyone would be richly rewarded.
As a token of his sincerity, Meyer made out checks to his investors from his business account, 3 H's Investment Properties, LLC, according to the police report. The "H" stood for "Hooligan"—Three Hooligans. If anything went awry, Meyer promised, the investors could cash their checks.
The details of the investment washed over Rice like soothing liquid. They weren't really important—what mattered was getting paid.
"We flew in because we were concerned," Rice recalls. "But everybody thought we were getting our money—at that point."
Meyer owed Rice a $370,000 payout. (Rice won't say how much he invested with Meyer because of pending legal action.) Meyer said he needed two more days. He'd make it worth Rice's while: Instead of $370,000, Meyer would pay $1 million.
"The money will be wired to your account," Meyer assured him.
Rice felt uneasy, but he agreed to the terms. He didn't have much of a choice.
Rice tried to stay calm. Meyer was an experienced businessman with a track record of success. Surely he could be trusted to keep his word.