By Jesse Marx
By Chris Parker
By Jake Rossen
By Jesse Marx
By Michelle LeBow
By Alleen Brown
By Maggie LaMaack
By CP Staff
COLIN CHISHOLM STRODE into a Citibank on Ventura Boulevard in Woodland Hills, California, in the fall of last year. Burning a hole in his pocket was a check for $120,000. He asked for the cash in $100 bills, then hopped a plane back to Minnesota with all the makings of an escape.
From his historic Deephaven mansion on the shores of Lake Minnetonka, Chisholm had steered a series of telecommunications companies with holdings in the Caribbean. As CEO, the 61-year-old with creased eyes and a graying pate wielded the respect and admiration of those around him. No one knew just how dire his situation had become.
Without warning, Chisholm stashed a cache of boxes loaded with dubious receipts in his unsuspecting neighbor's basement. He and his wife, Andrea, yanked their 6-year-old son, Colin Jr., out of school before the semester ended and said goodbye to their pack of orange-and-white Cavalier King Charles spaniels, who had names such as Driving Miss Maisie.
After packing their bags, the Chisholm clan fled their lakeside home with the chipped white paint and fading green roof, high-tailing it through the forested, winding private road and stone archway that had once been the gateway to new lives.
By the time Hennepin County sheriff's deputies came looking for the Chisholms, in February, they were nowhere to be found.
The next few weeks were a mad and dizzying affair. The Chisholms were accused of taking more than $167,000 in welfare, food stamps, and medical care from Minnesota, and an as-of-yet untold amount of public assistance in Florida.
Although the Chisholm case is unusual — only about 5 percent of welfare fraud investigations end up court each year — it highlights a hole in the system, one that's built almost entirely on faith.
There are national databases that can check whether people are receiving benefits in multiple states. However, most folks are caught through tips, says Jerry Kerber, inspector general at the Minnesota Department of Human Services. There's nothing "in place to go check people's lifestyle and see whether or not their lifestyle really does match what they're claiming in income."
To those who knew the Chisholms, the accusations were inconceivable. The couple was practically royalty, with seemingly bottomless pockets. They rubbed elbows with media power brokers and addressed themselves in social settings as Lord and Lady — the descendants of Scottish aristocrats.
"I'm having a hard time thinking that Colin is this person everyone says, but everything's pointing to it," says Kim Ritter, a family friend. "The facts are speaking loud and clear."
THE WALLS OF the Chisholm home shone with oil portraits. In the middle of the mansion stood a chapel, where Colin liked to take guests after showing them a registry of notable yachts in North America, one of which he owned.
At dinner parties, Andrea entertained friends with a seemingly genuine, affable air. Her seven purebreds were worth an estimated $2,000 each and looked like they had leapt from a Rococo watercolor. Her hair was bright red and immaculately kept under the white puffy hat that made an entrance before she did.
Smart and gregarious, the Chisholms struck many of their friends, neighbors, and associates as New Yorkers who'd just flown in from Gatsby's West Egg.
"They were gracious people," says John Peterson, a fellow Lake Minnetonka Kennel Club member. "They didn't put on airs."
They also cut an imposing figure in Florida, where Colin tooled around town in a two-seater Lexus, squiring guests from the marinas to their $1.5 million home in Lighthouse Point. He boasted that his yacht had been built by his great-grandfather — Hugh J. Chisholm, a prominent Maine industrialist. And though Colin looked a world apart from the salty sea dogs he employed, he impressed them with his first-rate seamanship.
During a tumultuous eight-hour trip down the Intracoastal Waterway after Hurricane Wilma, Colin served as a second set of eyes for the captain. Together they chartered through floating palm trees, sunken vessels, broken bits of docks, and stray buoys on the way from Jacksonville to their homeport in Aventura.
When he wasn't gushing about his boat, he was name-dropping powerful people. Colin spoke of Washington's inner circle as if they were guests at his cocktail party. Like President George W. Bush, he was fond of referring to the vice president's chief of staff as "Scooter," the way he would an old boarding school chum.
"He was a brilliant guy," one of the seamen says. "Colin was a great conversationalist."
Lest there be any doubt about Colin's bona fides, the men in his life were treated to private viewings of his personal financial statement. After dinner, he would pull them aside — away from the ears of the wives — and reveal the wonders of his treasure chest.
It was almost pornographic: $67,500 in antique furniture alone; a 1950 Chris Craft U-22 and 1968 Chris Craft 26-foot Cavalier estimated at $72,000. When you factored in the successful media businesses, the Chisholms proudly claimed $97.3 million on paper.
Best of all, Colin wasn't shy about sharing his good fortune. He found a willing pool of investors at Episcopal and Catholic churches throughout the Twin Cities. If holding out a collection plate for business endeavors seemed odd, no one questioned his motives. After all, Colin was a member of the exclusive Knights of Malta, the world's oldest surviving order with roots in the First Crusade.