The moment private investigators swooped on two North Shore teens in 2020 who thought their blackmail scheme had won them a massive payday. Instead, it landed them a citizen's arrest and a court date. Video / Mike Gillam / The Investigators New Zealand
A get-rich-quick blackmail scam devised by teenagers from an affluent Auckland school culminated in a citizens’ arrest and a court date.
But three years on, the case has concluded with a discharge without conviction, permanent name suppression and a victim questioning if justice was done.
George Block investigates a NorthShore crime caper gone awry.
“Hello, I know what you’re doing,” the email said.
“One call to the Serious Fraud Office and it costs you a lot of money. Lucky for you I’m more interested in personal gain.”
They were just two teenage boys, friends from a grammar school in Auckland, who thought they had found their cash cow. One had a loose familial connection to the businessman.
Their anonymous email on October 16, 2020, alleged wrongdoing by the businessman – without evidence – and said the only way he could stop the senders dobbing him into the Serious Fraud Office (SFO) was to pay up.
They asked him to reply with how much he was willing to pay to stop the tip-off happening.
“Reply to the email above with how much you think your freedom is worth. I’ll call up SFO on the 20th if I don’t get a response before then.
“Hope you can respect my hustle.”
Further emails followed and the teens ended up demanding a lump sum of $15,000 via Bitcoin and an ongoing $2000 maintenance payment.
That was where Mike Gillam of The Investigators came in.
Gillam is a former cop turned private investigator who had worked with the businessman before.
He and his team took over the businessman’s email correspondence with the teens and claimed not to know how to make Bitcoin payments.
They convinced the teens to accept the first payment in cash with a promise to learn how to use Bitcoin for future transactions.
Court documents obtained by the Herald and an account provided by Gillam with the consent of the businessman, who asked not to be named, reveal what happened next.
The setup
Gillam and his team managed to negotiate a week with the scammers to arrange withdrawal of the funds before the drop-off.
That allowed them to secure fake cash resembling stacks of $100 bills.
They hid the fake money and a discreet GPS unit inside a backpack.
Some paper money and a GPS tracker were hidden inside this backpack ahead of the fake money drop. Photo / Supplied
Gillam rustled up a team of investigators ahead of D-day.
The operator launched a drone 20 minutes before the drop-off to keep an eye on the area from above.
Five minutes ahead of the drop, one of the teens called to say he had been observing the location and was pleased the client was following instructions. This turned out to be a bluff.
They changed the drop location at the last minute to a bus stop near Narrow Neck Beach and ordered the businessman to leave the backpack there in an hour’s time.
He and the investigators drove to the new location. The businessman placed the backpack inside the bus stop and left.
About 20 minutes later, the two teens arrived in an SUV belonging to one of their fathers.
One left the car and ran to the bus stop while the other did a U-turn preparing to leave the way he came.
The investigators saw the teen who picked up the backpack give a thumbs-up to his accomplice after looking inside and apparently being convinced by the fake cash.
One of the teenagers gives a thumbs-up from the bus stop. But things are about to take a turn for the worse. Photo / Supplied
The investigators parked two cars behind the SUV, blocking one route of escape. Gillam rushed out of the car park from his observation spot and managed to block the other side of the SUV with his car just as the teen got back to the vehicle.
The team placed the pair under citizen’s arrest.
Gillam said the bagman was immediately compliant but the driver required some restraining.
Police arrived and took the pair into custody. Both were charged with blackmail.
The case
While both teens were arrested, only one went on to appear before the District Court.
He eventually pleaded guilty to blackmail, carrying a maximum penalty of 14 years in prison.
One of the teens in custody after police arrived. Photo / File
His lawyer, Peter Syddall, managed to obtain a discharge without conviction and permanent name suppression.
The suppression hearing at the North Shore District Court earlier this year was attended by the teenagers’ parents but not the teen, who is away at university in another city.
Judge Clare Bennett agreed with Syddall that the threshold of extreme hardship required for permanent name suppression had been met.
The judge referenced the fact that the frontal cortex of the brain is still developing in teenagers, which can limit their reasoning ability or tendency to think before they act.
“This offending was pretty serious, but it certainly had the ring of youthful stupidity for it,” Judge Bennett said.
However, she allowed the Herald’s application to access the summary of facts to which the teen admitted.
The businessman said he was astounded that, after being caught red-handed and facing a possible 14-year jail term, the teen has escaped with no penalty.
“We had him ... dead to a T,” he said.
“We’re blown away he got a discharge without conviction and full suppression.”
He was full of compliments for Gillam and his team and seemed relatively sanguine about the unsatisfactory conclusion to the saga.
