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Reading Time:

8 minutes

Published:

22 December 2003

The Simple Evil of Henry Kaye

Clearing up the current confusion.

If you’re having trouble understanding what’s happening in the dirty world of Henry Kaye at the moment, you’re not alone. It’s a world of confusing complexity.

As you’ll see, this complexity is deliberately designed to confuse. It’s all part of the on-going con that is Henry Kaye. He cons consumers, he cons his colleagues, he cons the regulators and he cons those who try to get their money back from him.

In understanding this man, one fact must always be remembered. Henry Kaye is evil. It’s as simple as that. Once you understand this fact, his actions are no longer so confusing. You begin to understand that everything Henry Kaye does in business has one purpose – to help Henry and to hurt others.

Yes, that’s right. Given a choice between making a profit and helping people or making the same profit and hurting people, Henry will chose the hurt option. Not only is he a corporate psychopath, he is also a corporate sadist. According to many former colleagues, Henry enjoys seeing others suffer. “He laughs about it,” is a common phrase to describe his reaction to the effect of his evil.

Right now, the most important task for regulators, administrators and cheated consumers is to salvage something from the financial ruins caused by Henry Kaye.

And the most important point that must be understood is this – Henry Kaye cannot be trusted, not in any way. If people feel foolish for trusting Henry once, they are going to feel a lot more foolish if they trust him a second time.

Henry Kaye’s flagship company, the National Investment Institute (NII), was placed into receivership on November 25 this year.

Receivership – it sounds terrible. It sounds like Henry Kaye has gone broke. But when you realise it was Henry who appointed the receiver, when you realise that in the last year NII raked in a staggering $53 million from consumers – and when you understand that Henry Kaye is an evil conman who cannot be trusted – the obvious becomes clear. This is another of Henry Kaye’s con tricks.

Don’t believe it? Then ask a simple question – Where is the money? The millions of dollars of consumers’ savings that was paid to Henry right up to the days before he closed the doors of NII. The answer is simple. Henry has got the money.

When Henry says, “It is not my intention, nor has it ever been my intention, to profit at the expense of the creditors of the National Investment Institute,” he is doing what he does best – lying.

As a former insider – one of Henry’s senior colleagues – said on December 5 this year, “All along Henry Kaye had the intention to do what he’s done. This is first degree murder of people’s finances.”

So, what has he done – and what’s happening now? Here is a brief and simple summary of the evil that is Henry Kaye.

For more than three years, Henry Kaye attracted consumers to his get-rich seminars by using a simple, but very effective method – he lied to them. He lied in his advertising, he lied in his statements from the stage, he lied about his own investment achievements, he lied about guarantees, he lied about the accreditation of his so-called wealth courses. He never stopped lying.

In fact, the more he got away with his lies, the more effective he became at lying. Incredibly, the state and federal regulators did nothing to stop him.

Henry’s claims became so outrageous – and went on for so long – that, more incredibly, the lack of regulatory action actually aided and abetted him in his plan to fleece the public. Surely, if his claims weren’t true, thought consumers, then he would not have been allowed to keep trading. Henry played on this point, repeatedly telling consumers and his sales force that NII’s courses were government approved.

With words like ‘institute’, ‘course’, ‘students’, ‘enrolment’, ‘tuition’, ‘guarantee’, ‘graduates’, ‘government approval’ and a campaign to push the public fear buttons about wealth and future security, all the ingredients for a massive fraud were in place.

To multiply his fraud on a national scale, Henry also taught hundreds of salespeople to lie on his behalf. It is testimony to his pernicious character that he managed to persuade so many salespeople to lie. How did he do it? Simple, he used the same technique on his salespeople as he used on everyone else. He conned them into believing that his methods would not only make consumers rich, he would also make salespeople rich. Instead of being known for what they were – salespeople flogging overpriced courses, Henry’s salespeople were known as “consultants enrolling students to his Institute”.

Many of these salespeople are now shattered – both financially and emotionally. Unlike cheated consumers, who at least have some public sympathy, most of Henry’s salespeople are now in hiding, riddled with guilt and shame. Bankruptcies, ruined relationships and mental breakdowns are just a tiny part of the ugly legacy of Henry Kaye. And that’s among his own people, his former associates.

NII is now in receivership. It has almost no money and no assets. But the only reason that NII was placed in receivership is because Henry knew the game was up. He knew that the days of being able to con thousands of people into paying for his worthless courses were over. With all the bad publicity, two things happened at NII – new customers dried up and old customers began demanding refunds.

So, Henry got the money out of NII and then closed it down. Simple.

Tens of millions of dollars has now been transferred out of NII. Where to?

Well, this is where Henry uses his cloak of complexity and confusion to cover-up his crimes. Henry is the director of more than a hundred other companies. He has done dozens of deals to secrete the money in any number of different places – in his other companies, in complex inter-company loan arrangements, in deals with shadowy ‘partners’ and, almost certainly, in overseas bank accounts.

The last thing Henry Kaye wants right now is for NII to be placed in liquidation. Unlike receivership, where there is an administrator liaising with Henry, liquidation would mean that Henry would lose all control. A liquidator would take over. And the liquidation of one company – NII – could quickly lead to the liquidation of all the other companies controlled by Henry Kaye.

And so, what does Henry Kaye do now? He tells NII’s administrator that if NII is liquidated the creditors will get nothing because NII has nothing. It sounds so logical.

However, if he is allowed to keep his other companies intact, Henry will enter into a deal where he “promises” to complete his many property projects and developments. By using the assets and cash in his other companies, he will then pay money back to NII. What a good guy.

According to Henry, this deal means the creditors of NII will receive between 30 and 50 cents in the dollar. Faced with the prospect of voting for immediate liquidation of NII and receiving nothing or faced with allowing Henry to keep trading with his other companies and receiving something, it looks like a good deal. Nothing or something. It’s a no-brainer.

And so, of course, the Administrator will recommend to the creditors that they accept Henry’s deal. Oh, Henry, it’s so clever. No one has realised the obvious – if you intended to put the money back in NII, why take it out in the first place?

Something is being overlooked in this latest Henry saga – something very simple and very obvious. Henry Kaye is a conman. He has lost all rights to be trusted, by anyone.

Just as deals should never be done with terrorists, deals should never be done with conmen. Does anyone seriously think, for a moment, that Henry intends, from the goodness of his heart, to work hard to repay the money he has stolen? Or, does he intend to scarper with even more money? The current deal is a sham according to many of those who know Henry. Just another con by a conman.

Have the creditors forgotten that Henry Kaye who now “personally guarantees” certain aspects of his proposed deal to creditors is the same Henry Kaye who, for years, conned millions of dollars from them with his false and worthless guarantees?

This is the same Henry Kaye who promised to “guarantee to double your income in 90 days”. Promise broken. The same Henry Kaye who promised to make you a “multi-millionaire in three years”. Promise broken. And it’s the same Henry Kaye who promised you returns of 18 per cent via Mezzanine lending. Again, promise broken. And, finally, if you weren’t 100 per cent happy, Henry promised that he would “insist” on giving you all your money back.

A string of seductive promises, all broken. But that’s the nature of evil, it’s very seductive. It’s the nature of Henry Kaye.

The best way to give the creditors the best chance of getting any money back is to liquidate all of Henry’s companies. Freeze all his assets, seize his passport and arrest him for fraud.

Through his deceit, Henry Kaye has fleeced tens of millions of dollars from consumers. When deceit costs people money, that’s fraud. Henry Kaye has committed fraud on a grand scale. It’s astonishing that he still has his freedom.

What’s more astonishing is that he is still persuading people to trust him.

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