TeleOne
I wouldn’t touch them with a bargepole.
One.Tel creditor asked if he would deal with TeleOne
In February 2002, Jodee’s two most trusted lieutenants, Mark Silbermann and Kevin Beck, announced they would be back in business by April with a company called TeleOne, selling long-distance and international telephone services at rock-bottom prices. The new outfit had a remarkably similar logo to One.Tel, and its name was almost identical. It planned to use One.Tel assets, snapped up at bargain prices, and employ several of the old company’s former staff. It even had the dude’s dad and sister as its mascots, thanks to Adam Long, Jodee Rich’s erstwhile brother-in-law, who had agreed to create them for the new company. It would not, of course, have to pay any of One.Tel’s debts.
Whether the new venture could succeed where One.Tel failed was not immediately clear, but Australia’s two major carriers said instantly that they would not be doing business with Jodee’s acolytes in any incarnation. ‘We would not be leaping into bed with them again’, an Optus spokesman told The Australian.
‘Have they no shame?’ a Telstra official inquired, adding, ‘They have got Buckley’s, because of the obvious link with the company that owed us money’.
Plenty of One.Tel’s creditors also vowed to boycott the business. Ben Sharma, the owner of Roadhound, who is owed more than $5 million for mobile phones his company supplied and was not paid for, could barely contain his fury when he heard the news. ‘I think it should be illegal’, he told me angrily. ‘We certainly won’t be dealing with them in any shape or form, and I will be advising everyone else in the mobile industry to steer clear of them too.’ This probably did not bother Beck and Silbermann, as TeleOne was not planning to get back into the mobile business. Nor would it offer local calls, which lost so much money for One.Tel, the company that crashed with them at the wheel.
But TeleOne’s dynamic duo were unlikely to find many friends in other areas. Allied Express, a privately owned courier company in Bankstown, which lost $224,000 swore it would have nothing to do with them. ‘I think it’s disgraceful’, said credit manager Graham Farrell. ‘They just pick themselves up, dust themselves off like nothing has happened and start all over again.’ Asked whether Allied would do business with TeleOne, he said, ‘Absolutely not. I wouldn’t touch them with a bargepole’.
Customers may ultimately be happier about giving Beck and Silbermann a second go, because they won’t have to risk their money as creditors do, but when the news broke there were plenty of angry punters who felt that One.Chance was enough for Jodee and his boys. The vast majority of people who emailed the Sydney Morning Herald’s website expressed scorn or amazement, or a mixture of the two. ‘What a joke’, one wrote. ‘I was a One.Tel customer, and it was the most pathetically run company I have ever used. Let’s reward the dodgy bastards by letting them do it all over again to another database of customers.’
‘I cannot believe that they are allowed to be back in business’, wrote a former One.Tel employee. ‘Some staff are going back, I cannot believe that some people are so stupid.’
‘What consumer in their right mind would join TeleOne after seeing One.Tel’s spectacular flop last year?’ another asked.
‘Absolutely opposed to any of these people being allowed to operate in managerial capacity in any business ever again’, a fourth contributed. ‘They burnt a lot of people with their cavalier actions. Don’t let them do it again!’
As the hardback edition of this book rolled off the presses in March 2002, TeleOne was busy fitting out new offices in Sydney’s Macquarie Street with some of the gear that once made One.Tel staff feel at home. Three months earlier, Kevin Beck had forked out $123,000 at auction on flat-screen monitors, timber desktops, chairs, filing cabinets and computers that had previously graced One.Tel’s Castlereagh Street HQ. He had even purchased some of the famous fish tanks, which suggests that he, Silbermann, or their unidentified backers, were feng shui believers. More importantly, the new company had bought some of One.Tel’s Summa4 switching equipment, which was vital in running a telephone business. Needless to say, it had picked up this stuff at a fraction of its original cost.
Beck and Silbermann claimed that the new business was owned by their families—or family trusts—but they were coy about whether anyone was backing them. They told prospective recruits, in confidence, that TeleOne has $3 million in the bank, and that Jodee Rich was ready to support the company if necessary. Silbermann also told me that the business was funded by ‘private equity’, whose source was confidential. When I asked whether that meant someone apart from the Beck and Silbermann families, he said: ‘No comment’. Interestingly, the registered office of TeleOne Pty Ltd was an accounting firm called Stirling, Warton, Williams, whose principal, John Warton, was auditor of Imagineering in the 1980s. Nowadays, Warton acts as an accountant to Jodee Rich’s private companies. Since 2000, he has also acted for Mark Silbermann.
When I asked Jodee Rich in February 2002 whether he was financing TeleOne, he told me that he was not, but had ‘steered them towards people who could’. He admitted that he had given Beck and Silbermann advice and would like to be involved in TeleOne ‘sometime in the future, if there is an opportunity … if my name is cleared’.
It would have been hard for Rich to deny any link. In my meetings with him in late 2001 it became pretty obvious that he was well informed about the new venture. He, Beck and Silbermann were working out of adjacent offices at Ebsworth and Ebsworth, the law firm Jodee uses, in the Glasshouse building in Sydney’s King Street, and were frequently on the phone to each other. It appeared that when Jodee called, Beck and Silbermann would come.
Of course, there is no legal reason why Jodee Rich should not be involved in a reprise of One.Tel, even if it does use the company’s former assets and trade on its name. He is entitled to be a director of an Australian company unless or until a court rules he cannot, as are Silbermann and Beck. But in light of Jodee’s reluctance to be in the thick of it, it is a trifle surprising that his close colleague and co-defendant in the ASIC action, Mark Silbermann, has no qualms.
Although Silbermann is not a director of TeleOne, he is clearly one of its lynchpins. When I asked Kevin Beck what would happen if his partner were to be banned from running the company he said: ‘We will just have to take it from there’.
On the day of TeleOne’s launch, it was Silbermann, not Beck, who fielded most of the questions from the press. On ABC Radio’s AM program, he was asked by Narelle Hooper: ‘How can you justify setting up a new business when your previous activities in One.Tel are still under investigation and indeed ASIC is seeking to have you disqualified as a director?’. Silbermann replied: ‘I don’t feel responsible in any way for the demise of One.Tel. I think people should look to the major shareholders for that’.
It had a familiar ring to it. Clearly, One.Tel’s former finance director thinks that the collapse of the company was not his fault either.