I lost track of Robert Booth Nichols until July 15, 2008 when a Bloomberg News article appeared on the Internet entitled “Bayou’s Israel Cheated in Scam,” by court reporters David Glovin and Bob Van Voris. http://www.bloomberg.com/apps/news?pid=20601127&sid=aLCwdJsx0V3M&refer=law
The article talked about Samuel Israel of Bayou Management Group LLC being cheated by Robert Booth Nichols, “who in a 1993 lawsuit claimed to have worked for the U.S. Central Intelligence Agency for 20 years. Nichols was also the target of a 1987 probe by the Federal Bureau of Investigation of organized crime in the entertainment industry,” wrote Bloomberg.
An excerpt of the article read as follows:
As Samuel Israel grew desperate to raise money in 2004 to save his Bayou Group LLC hedge fund firm, he turned for help to a Hawaii man who promised a windfall and then conned him out of $10 million, said a U.K. investigator.
Robert Booth Nichols cheated Israel, later convicted in his own $400 million theft, in a ‘prime bank’ fraud, a scheme used by con-artists promising quick riches in secret markets, the U.K. investigator said in a document filed in June in federal court in New York. U.S. prosecutors seeking to recover funds for Bayou investors won a British judge’s ruling in November freezing $1 million Nichols held there, and they may be pursuing millions more in Singapore, Nichols’s lawyer said.
Robert Booth Nichols, 65, denied wrongdoing and sought to retain the $1 million in London. He said in court papers that he helped Israel invest in a legitimate, though unspecified “project’’ involving U.S. government obligations. Nichols said he had no reason to believe Israel was engaged in fraud.
“He was asked to find something, and he found it,’’ Nichols’s lawyer, Joseph Bainton, told Bloomberg, declining to elaborate. “There are very few people capable of performing this service, for which he was paid a lump sum of $10 million.’’
Nichols said in court papers that he believed the investment was on behalf of Israel personally, that Nichols was told his services “involved matters of national interest,’’ and that a first cousin of President Bush, John P. Ellis, vouched for the legitimacy of the transaction. Nichols said the deal required him to contact representatives of foreign governments that he knew, according to court documents.
Nichols’ lawyer told Bloomberg that “Mr. Ellis attended some meetings and gave Mr. Nichols some assurance with respect to the approval of the United States.” Ellis worked at GH Venture Partners in 2004, according to Nichols’ court documents.
The criminal case is U.S. v. Israel, 05cr1039, U.S. District Court, Southern District of New York (Manhattan).
The bankruptcy case is Bayou Group LLC, 06-22306, U.S. Bankruptcy Court, Southern District New York (White Plains).
The missing link in the above story is the $250 Billion Treasury Note secured by 2,500 metric tons of gold at the Atlanta Federal Reserve, Serial Number SC 3040-20. Robert Booth Nichols’ lawyer described this to Bloomberg as an unspecified “project” involving U.S. government obligations. However, the reporters had no knowledge at the time they wrote the story that the “project” for which Nichols was paid $10 million allegedly involved Nichols locating and obtaining the Treasury Note for Samuel Israel and depositing it at the London Safe Deposit Box Company Ltd. http://londonsafedeposit.co.uk/
In early July 2008 Samuel Israel was already in custody for conspiracy and fraud, including misappropriation of millions of dollars in investor funds for his personal use http://www.cnbc.com/id/25495282 and, according to court documents, he had provided details of the secret “project” to the FBI at some point in time. As a result of his cooperation, the FBI, with the assistance of the City of London Police, reportedly retrieved the Treasury Note documents at the London Safe Deposit Company and returned to the U.S.
Samuel Israel sued Robert Booth Nichols demanding the return of the $10 Million. Nichols responded in lengthy court filings that exposed the $250 Billion “project” and alleged that George Bush’s first cousin, John P. Ellis, provided confirmation of the legitimacy of the “project” and that the U.S. government sanctioned it. (Case 1:08-cv-06036-CM Document 1-8 filed 7/2/2008, Page 15 of 19).
Interestingly, nothing was published as of this writing in mainstream media relative to the $250 Billion Treasury Note (“project”) discussed in Nichols’ letter/court filing to Judge Colleen McMahon (Case 1:08-cv-06036-CM Document 32-2 Filed 12/23/2008, Page 1 of 5 at the United States Courthouse in New York) in which his lawyer wrote:
On September 12, 2008 we served the enclosed Rule 30(b)(6) Notice in an attempt to quickly obtain clarification on this $250 Billion issue. The Government contends that the notice is overbroad, burdensome and oppressive. In making this assertion, the Government has yet to state plainly whether these instruments are authentic. If they are not authentic, then how burdensome could it be to produce a witness to say: ‘Sam told us he had this stuff and we finally got around to collecting it last summer.’ On the other hand, if these instruments are authentic, then this case – indeed the entire Bayou bankruptcy case – changes quite dramatically. We would like to get to the bottom of this issue quickly. The Government’s delay in producing documents has forced the parties to defer the commencement of depositions. So even if Your Honor can quickly break the logjam on the $250 Billion issue, it nonetheless appears some adjustment to the schedule is necessary.
It is noteworthy that on July 2, 2008, just days after Samuel Israel, 48, walked into the police station in Southwick, Mass. and said he was a fugitive wanted by the federal government, Robert Booth Nichols’s lawyer filed a “Demand for Trial by Jury” at the court in New York. (Document 1-9).
In effect, it appears Nichols was blackmailing the powers that be because a public trial would have exposed a scandal far exceeding the Bernie Madoff fiasco. This was not the first time Nichols had used this tactic. On March 21, 1993 the Los Angeles Times had published a story entitled, “Trial Offers Murky Peek into World of Intrigue” by Henry Weinstein and Paul Feldman which reported that Nichols presented himself during testimony as a globe-trotting businessman and intelligence operative. Armed with letters on White House stationary and snapshots of himself posing with foreign political and military dignitaries, Nichols told jurors that he toiled quietly and selflessly for nearly two decades on behalf of the CIA in more than 30 nations from Central America to Southeast Asia.
The Los Angeles Times reported that Nichols was investigated by the FBI for international money laundering in 1978. In a 1987 federal court wiretapping affidavit, prepared by FBI Agent Thomas G. Gates, it stated that “FBI investigative files further reveal that Nichols may have been associating with the Gambino La Cosa Nostra organized crime family in New York.” The court case in Los Angeles ended in a mistrial, wrote the Times.
Nichols’ demand for a Trial by Jury in the Bayou case was effective. In January 2009 Bayou Management and Nichols came to an agreement to settle out of court for an undisclosed amount of money. The court gave Nichols 45 days to come up with the money, which would have been March 6, 2009, his birthday.
However, on Valentines Day, February 14, 2009 Robert Booth Nichols reportedly died in Geneva, Switzerland. Nichols and a friend, Mark Soltz, a New York stockbroker, had been staying at a hotel near the airport while conducting business in Geneva. When Nichols failed to show up at a meeting in the morning, his friend found him dead and identified the body to authorities. The exact cause of death was not determined, but authorities believed he died of a massive heart attack. There was also a blow to the head, but police assumed that was caused when he fell to the floor. The friend reportedly arranged to have the body cremated in Geneva and the U.S. Embassy in Bern notified Nichols’ wife, Ellen, in California. (Embassy of the United States Bern, Sulgeneckstrasse 19, CH-3007 Bern, Switzerland, (031) 357-7011). http://bern.usembassy.gov/contact.html
Detective John Powers of the Riverside Sheriff’s Department in California had been communicating with me on a 28-year-old cold-case file relating to a triple homicide in Rancho Mirage which he was working on, so I asked him as a favor if he could confirm the death of Robert Booth Nichols. Detective Powers subsequently wrote back that he had confirmed Nichols’ death through the FBI and also through Ellen Nichols, Robert’s wife. Ellen’s lifelong love affair with her husband had ended abruptly with his death in Geneva, and she was devastated. She told Detective Powers that she believed if she had been with him in that Geneva hotel room, she might have been able to save him, but she had been recuperating from surgery on her leg and had stayed behind with her father in Los Angeles.
At the time of Nichols’ death, there were numerous factions chasing the Treasury Note in an attempt to learn if it was authentic, or not? According to one source, a copy of the $250 Billion Treasury Note was attached to Samuel Israel’s original court filings against Robert Booth Nichols, but that exhibit had apparently been redacted from the Internet court records. http://dockets.justia.com/docket/court-nysdce/case_no-1:2008cv06036/case_id-328683/
Meanwhile, it appeared that all references to the Treasury Note were being systematically erased from the court and the Internet. As of April 15, 2009 the Bayou case had reportedly not been vacated, though Nichols’ lawyer had notified the court that his client was deceased, according to Bob Van Voris, the Bloomberg reporter who covered the case.
Theories abound as to whether Nichols actually died and took his secret to the grave, or simply disappeared into the international netherworld where aging spies and intelligence operatives go to retire. As of this writing, it is unknown whether Nichols paid the settlement money to Bayou before his death, or if it remains unpaid. Some theorize he was murdered to keep him from testifying in court about the “project” and John P. Ellis. Others believe the government came to his rescue and he was in a Witness Protection program with a new identity – for reasons that only Nichols and his handlers would know.
As of this writing, there were already “Nichols sightings” in Europe. One person said a lawyer had told him that Nichols was sighted in Liechtenstein.
According to Detective John Powers, the FBI was investigating the circumstances of Nichols’ death and they asked him not to interview the witness, Mark Soltz, until they (the FBI) had completed their investigation. In the meantime, the Treasury Note was a mystery that had a history and a paper-trail, and the question remained, was it authentic? One Bloomberg reporter said Prosecutor Jeff Alberts filed a letter to the court stating the Treasury Note was not authentic, but he was unable to produce a copy of the letter.
One retired banker in Europe provided some history on the Treasury Note. He wrote:
Having spoken with a banker friend in Switzerland, he related to me that the 2500 m/t of Au [gold] used to secure the TN was originally 10,000 m/t. And that in 1983 four TN’s were created secured by 25% of the Au in the depository. In other words the TN in question is 1-of-4 created in 1983.
The banker followed up with:
You are absolutely correct in that there were 5 TN, whereas, I originally related there were 4; the 4th was split into 2 TN’s, thereby creating 5 TN’s secured by the 10 m/t of Au. Also confirmed that the names of the TN’s, as stated within your e-mail is correct.
The run on the bank that you referred to occurred when the bank holding the lien called in their loan(s) for apparently $550B, which shook the financial foundations around the world. What I am unable to find out is ‘WHICH’ bank called in their marker?? Basically, it is an obligation of the Treasury. Apparently, the Judge ordered the attorney’s to find out if the TN was real or not... that started the snowball that’s bout’ to ‘blow the socks off’ of the entire game.
After further investigation, the banker wrote:
I called a banker friend in Zurich this morning to see what he might know? He related that Au held in US Fed depositories have heavy liens/encumbrances, of which, many may be fraudulent. Asking what he knew, or had heard about the leverage liens currently in the Fed depository in Atlanta? And asked if he knew anything specifically about 2500 metric tons of Au at the Atlanta facility? His remark was stunning, quote: “The word is that US held assets may have debenture liens in excess of 4x its value.”
I asked: ‘You mean 4x its value at $400+ p/oz. 10 years ago, or 4x its value today?’ He answered: ‘At today’s strike prices’ Asked how he knew? He said, ‘They’d received several memos beginning months ago and that Swiss banks haven’t traded in US Fed deposits (either, liened or leveraged) for over a year.’ Further, ‘They will only advance cash or credits to 80% of current market value (in lieu of) clean collateral.’ (Meaning no liens and/or encumbrances).
Based on what has been related by what I consider a creditable source, it is possible the paper in question [Treasury Note] may well be fraudulent.”
The Bernie Madoff ponzi scheme reportedly amounted to less than $50 Billion http://www.time.com/time/business/article/0,8599,1866689,00.html yet it received overwhelming media coverage. If the Treasury Note in question was a $250 Billion ponzi scheme perpetrated by Robert Booth Nichols against Samuel Israel, then why all the secrecy surrounding it? That question remains to be answered. One writer, Guy Lawson, is seeking to find the answer to that question. He has reportedly spent countless hours interviewing Samuel Israel in prison, and what a story he will have when his book goes into print! In a phone interview, Lawson said he has seen photos relating to the “project” (obligations of the U.S. government) and confirmed that the photos were indeed removed from Israel’s case file.
We exchanged information about Robert Booth Nichols, I sent him some RBN documents, and he sent me a 300-page Deposition taken by Assistant U.S. Attorney Jeff Alberts in New York on December 16, 2008. Also present at the deposition were three representatives from the Federal Bureau of Investigation (FBI); Jay F. Kramer, Christopher Kim, and S.A. Carl A. Catauro.
Within the lengthy Deposition document, I found mention of John Ellis, the first cousin of President George W. Bush, whom Nichols described as Samuel Israel’s “best friend” (p. 61) and dozens of U.S. intelligence people named in the document whom Nichols said worked for the CIA. I noticed that some of them were closely connected to Wackenhut, such as Frank Carlucci (p. 39) and Harry Fair.
Interestingly, I noticed that Nichols refrained from providing most of the names of people he worked closely with that are listed extensively on his personal and corporate documents, as well as in the FBI reports on him. Clearly he was withholding a great deal of information from the Deposition.
He gave a clue to this when he explained why he never paid income taxes. He said he was told [by his handlers]: “You will never be bothered by your government, period. Your job is to keep this information … in secure locations. It is a very sensitive matter, very sensitive to this country, and under no circumstances can this reach the public ---“
Nichols added,” And my files, they said they never wanted my files at any time to be public, at any time, under any circumstances.” He said he was told that what was taking place today (the Deposition), would not happen to him. He clearly felt he’d been left out in the cold. “I do what I’m told to do. I am a facilitator. I am a person who is tasked to undertake something, achieve an objective --- that’s what I do. There is no paperwork in my world, except the results of achieving an objective.”
With regard to FIDCO, Nichols said, “I was involved with them jointly and several other parties in the development of the ‘fuel air explosive.’” (This was in addition to the alleged redevelopment of areas in Lebanon, near Beirut). Nichols said his code-name, as used by the directors of FIDCO and the British, was “mongoose.” His code name for the fuel air explosive project was “Eel.”
Within the Deposition, Nichols said he had met with the Chinese about the U.S. government obligations to the Maiwah family, a prominent entity in Luxembourg, which are the lineage and the offspring of Chiang Kai-shek.
He was told the documents were legitimate by a number of people, one of which was allegedly an advisor to the President of the United States, and another by the name of Tansri Teong, a liaison officer for the Maiwah family, whom he communicated with as well as members of the Maiwah family.
Nichols stated that he was hired by Samuel Israel to perform a service for which he was paid $10 million. He described the service as follows:
“To obtain a sealed treasury box that originated from the Chinese, from the Chinese that he [Israel] said he was quite familiar with, and it could not be opened … it had to be a hundred million dollars box, a hundred million dollars in a certain series or the series was irrelevant, but no more than a hundred million dollars on the plate and identification.” (If it contained different figures, higher figures, then it would be bogus).
He (Nichols) was supposed to provide to Samuel this box unopened, to provide him the names of the principles with whom he could speak to negotiate the redemption of that box and many other boxes of the same nature; to provide him photocopies precisely of Federal Reserve notes and U.S. government silver (and gold) certificates, their location, and what security vaults and security house they were located in and with whom negotiations could take place to settle that. Nichols explained:
”The Chinese didn’t say, give this to Samuel Israel. They said, ‘sit down with the correct credentials in the Treasury or the Executive Branch with this if that’s necessary. These are legitimate documents. This is a legitimate debt.’ So Samuel Israel said that’s what he’s gonna do. They didn’t say, ‘work this out with someone in an alley or something of that nature.’ They said sit down with the correct parties and the United States government. Sam Israel said, I am going with my best friend, John Ellis, and proceeding. They [the Chinese] said they’d settle for eight cents on the dollar ---.”
Nichols said he was told that these were “financial instruments that Israel believed to be bona fide obligations (debt) of the U.S. Department of the Treasury; that five of those instruments had already been taken and settled on by the United States government. The Chinese told him that they were settled with payments from Chase Morgan.
Nichols ultimately provided Samuel Israel with an “original etching” of a $100 million Note, and Israel paid him $10 million which he deposited in banks in London, Liechtenstein, and Singapore. Nichols said the bank called the Note currency, but he (Nichols) called it an “etching” because the U.S. government says they never printed a bill over $10,000. Nichols reportedly told this to Israel, but Israel told him it was not his affair. Nichols said he obtained the note from (name withheld) who took it out of a security vault in Switzerland (where many more notes existed), and brought it to him and said, here is your etching.
Guy Lawson advised me to read the 2003 book Gold Warriors: America’s Secret Recovery of Yamashita’s Gold by Sterling and Peggy Seagrave. He said it gives an outstanding history of the looted treasury of Chiang Kai-shek in China by the Japanese, who stored it in the Philippines.
I wondered if Robert Booth Nichols had read this book in 2003, one year before he scammed Samuel Israel (in 2004) out of $10 million dollars? Assistant U.S. Attorney Jeff Alberts in New York reportedly filed a letter with the court stating the Treasury note was a fraud.
In the Deposition, Nichols had addressed this issue. He felt the U.S. government should have had witnesses present when the box was opened in the U.S., after it was seized in London. “I think that it should have been opened in the presence of counsel and parties from the other side. It’s like asking the Federal Reserve, is this a legitimate box – and if they say yes, that means they could owe a trillion dollars, and if they say no, they owe nothing. I just think there should have been someone else present to give another opinion.”
Jeff Alberts had asked, “Is that because you think the federal government might lie about whether or not they are legitimate financial certificates so they don’t have to pay [the] money?”
Nichols answered, “It’s a possibility.” No one will ever be able to question Nichols further on this issue, because he was found dead in Geneva two months after the Deposition was taken.
Every government official I talked to, every journalist, told me that nothing can be done to dismantle the Octopus, there is no one in office in this great nation that has the power to prosecute the Octopus criminals because the tentacles have become an integral, and accepted culture within our society, and indeed within our economy.
I began my investigation of the Octopus in the late 1980’s and ended it in December 2009. I called it the never-ending-story. But during that two decades, I gained a perspective. Sooner or later, the pendulum always swings back. In the year 2009 a number of events occurred which indicated that, through attrition, the pendulum was in fact swinging back.