« Home | Alan Meckler - ShutterFly Makes No Money, Reminds ... » | YouTube is Hugely Profitable - $63 million in Reve... » | StubHub on the Block - eBay a Buyer? eBay Inc. » | Why It's Time to Speculate in China Technology Dev... » | AOL Opens Up With OpenRide » | Hedge Funds Blowup - Vegas Management Down $9 Bill... » | Fox Launches PrimeTime Shows on MySpace » | Skype Goes Mobile With Belkin » | Borat Movie - Top Secret Invitation from MySpace » | Wanted: Cheese Artisans, Pet Psychics, and Human B... »

October 04, 2006

Gizmondo - How Nordic Mafia Embezzled $382 Million While Creating The Next Cool Gaming Device

posted by MR WAVETHEORY at 10/04/2006 11:17:00 PM
Wired writes a great investigative report about Gizmondo - the cool gaming device with MP3 and video player, gyroscopes for motion sensing, multimedia messaging, and Bluetooth wireless networking for multiplayer games - that never was. It was supposed to overtake the Sony PSP and the Nintendo DS. Wired traces the company from how it was founded by Nordic Mafia leader, Carl Freer, and his cohort Bo Stefan Ericksson, who transformed a flooring company into Tiger Telematics, and how it all spectacularly unfolded.

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."

Previous Posts

7 Comments:

Blogger Spirit said...

Great Travel Writer ideas for you.. Check it out

12:28 AM  
Anonymous Anonymous said...

As a friend of Mr. Freer, I think a couple points should be made to set the record straight.

In the first place, neither Wired magazine nor any other reputable source has ever suggested in any way that Mr. Freer was a “Nordic Mafia leader.” That’s absurd and slanderous.

In the second place, regarding Gizmondo. What you have to remember is that the company produced a real device that received rave reviews. However, the company was unable to secure the big financial push it needed in order to manufacture the device on a large scale. Gizmondo was no scam. It was a real, viable effort that came very close to success.

The salaries paid to Mr. Freer and other executives were not out of line when compared to the compensation of other executives in the industry. Perhaps the most telling point regarding Mr. Freer’s compensation is the fact that he invested $14 million of his own money in Gizmondo stock (with the end result that he lost $38 million.)

Would he have been willing to risk that for a scam?

4:04 PM  
Blogger MR WAVETHEORY said...

Thanks for the insight!

6:29 PM  
Blogger gfutfy said...

welcome to the wow power leveling cheap Wow gold service site, buy cheap wow gold,wow gold,world of warcraft power leveling buy wow gold

11:33 PM  
Blogger chenlina said...

chenlina20160601
coach outlet
michael kors outlet clearance
michael kors handbags
instyler max
michael kors outlet
nike air max 90
jordan 3 white cenment
kate spade
burberry outlet
true religion
louis vuitton outlet
replica watches
rolex watches
ray ban sunglasses
coach outlet
nfl jerseys wholesale
kids lebron shoes
michael kors handbags
toms shoes
ralph lauren outlet
michael kors outlet online
michael kors outlet clearance
michael kors outlet
christian louboutin sale
adidas originals store
louis vuitton outlet
cartier watches
michael kors uk
kobe bryant shoes
michael kors handbags
michael kors outlet
michael kors outlet
louis vuitton outlet
christian louboutin outlet
nike trainers
ray ban sunglasses
ray ban sunglasses
toms wedges
cheap jordans
tod's shoes
as

7:59 PM  
Blogger Fangyaya said...

cheap oakley sunglasses
cheap oakley sunglasses
nike sb
coach factory outlet online
cheap nfl jerseys
nike uk
jordan shoes
nike running shoes
michael kors handbags
mont blanc pens
gucci outlet online
nike air huarache
louis vuitton
adidas uk
timberland outlet
coach factory outlet
christian louboutin outlet
oakley vault
kobe 11
louis vuitton handbags
true religion jeans
christian louboutin outlet
toms shoes outlet online
michael kors handbags
michael kors
louis vuitton handbags
michael kors outlet
louis vuitton outlet
longchamp handbags
louis vuitton outlet
gucci outlet
coach outlet
true religion
gucci bags
ray ban sunglasses outlet
coach outlet
kobe bryant shoes
kevin durant shoes 8
louis vuitton outlet
replica watches
20167.8chenjinyan

1:14 AM  
Blogger New York SEO Expert said...

Nice article. SEO Consultants Orange County

11:29 AM  

Post a Comment

Links to this post:

Create a Link

<< Home