Gizmondo - How Nordic Mafia Embezzled $382 Million While Creating The Next Cool Gaming Deviceposted by MR WAVETHEORY at 10/04/2006 11:17:00 PM
For his efforts as managing director, Freer was awarded a compensation package that totaled nearly $2.2 million in 2004, his first full year on the job. He and his wife (who was paid $174,000 by Gizmondo for "consultancy services") moved with their children onto a huge estate in Hampshire and filled the garage with expensive autos. On weekends, Freer could combine the two passions he shared with Eriksson - expensive jewelry and flashy vehicles - by roaring around on a Harley-Davidson with a diamond-etched crankcase.
His partner in 2004 Eriksson was rewarded with an annual compensation package that included $867,465 in salary, $1,365,456 in bonuses, and 884,024 shares of stock, along with an "automobile allowance" of $104,095.
Before launching the gaming device, the company bought a modeling agency to support its modeling efforts. "To add to the glitter, in 2004 Gizmondo purchased a 75 percent interest in a London modeling agency called Isis, ensuring that there would be plenty of beautiful young women at its parties and events." Even flashier than the Gizmondo were the booth babes and dollies hawking the device.
Tiger launched Gizmondo in Europe and the US and the company swiftly went bankrupt. In the end, the company's "SEC filings show "sustained net losses aggregating over $382.5 million" in the 45 months preceding the resignations of Freer and Eriksson." Gizmondo leaves many questions of who these people were. The company's first 10-K SEC filing described Freer as a "co-founder of software company VXtreme," but Freer had never been involved with VXtreme (which Microsoft purchased in 1997). "A minor typo," Carrender explained when a reporter at the San Jose Mercury News pointed out the discrepancy: Freer had actually founded Weextreme, which Carrender described as an "offshore-based Internet consulting company that ceased to operate in the late 1990s." (Wired has been unable to verify that such a company existed.) Official papers also said that Freer once served as a trustee of London's prestigious King's Medical Research Trust. He never has.
The scheme unfolded when, "On February 21, 2006, Eriksson lost control of a million dollar Ferrari Enzo sports car which he allegedly drove while drunk on the road in California. Eriksson claimed to have been a passenger in the car, but this claim was not supported by forensic evidence. The car itself was not owned by Eriksson, but was claimed by the Bank of Scotland during the bankruptcy of Tiger Telematics."