The Tech Firm That Stuck Lights on Empty Boxes to Fool People
Businessman Barton Watson referred to himself as “Barton Watson III,” even though he was the first in his family by that name. That should have been an indication that he was a fraud. If not that, other clues existed. For example, prior to the events of this story, he had been convicted multiple times of fraud, and had served two years in prison, for fraud. Such things, more often than not, suggest a history of fraud.
Still, he founded a tech company called the CyberNet Group, and he convinced people it was making a lot of money. CyberNet resold computer equipment and claimed revenues of hundreds of millions a year. These sums pretty much all came from cooking the books, with the goal of getting more and more bank loans.
To convince creditors, CyberNet tried to look rich. Watson installed a wine cellar in the office, housing a million-dollar collection. He got a desk made of exotic wood and told people that it too was worth a million (it’s unclear whether it really was). He bought a Rolls Royce. When one client scheduled a visit to see if CyberNet really had the inventory they claimed, employees stuck blinking lights on empty server boxes to give the appearance of working equipment.
Finally, in November 2004, investigators got wise and got a warrant. By this point, the company owed $110 million and had only a couple million in assets — when their belongings eventually went up for auction, the wine actually represented a significant chunk of the company’s worth. Watson stayed home from the office during the search. Then, late one Tuesday, he got drunk on a $700 bottle of wine and called 911, saying he had a gun in his mouth. This was no ploy for sympathy. After hours on the phone with the dispatcher, and with police now surrounding his home, Watson really did fire the gun and kill himself.