HOW THE BAR WORKS MASTERMIND MADE A CAREER OF DUPING INVESTORS

While Renwick Haddow sits in a Moroccan jail cell and victims of his latest get-rich-quick scheme try to get their money back, Paul Peachey reveals that this is just the latest misadventure of a man with a talent to mislead

The brochure that promoted the African farming investment scheme was unequivocal. “We harvest – you profit,” it boasted on the cover. Videos posted on YouTube showed a busy agricultural operation in Sierra Leone where tall grass had been replaced by acres of rice fields. Farm buildings had been built. A new milling machine could produce 12 tonnes a day, officials confidently predicted, standing in front of sacks of rice piled high in the warehouse.

Not for the first time, a lucrative opportunity linked to serial entrepreneur and now detained British fugitive Renwick Robert Haddow was not all it seemed to be.

Haddow was last week detained in Morocco after the collapse of his office-sharing scheme Bar Works, which cost UAE investors $15 million (Dh56m), and global participants more than $40m.

By the time Britain’s financial services regulator took action over “false and misleading statements” by the rice scheme’s promoters, the operation had taken £8.1m from 1,000 investors.

They had not nearly trebled their money as suggested in the 2009 prospectus. In reality, they had paid for more land than the operation actually owned.

“This is not a comfortable situation,” said high court judge Nicholas Strauss, QC. He ruled that it was an illegal investment operation.

The Financial Conduct Authority went back to court last month to claw back some of the investors’ money from the entrepreneur and 15 other people and companies involved with the scheme.

One – the estate of a director who killed himself by walking in front of a train while suffering from stress during the authority’s inquiry – has settled and could have to pay up to £200,000.

While lawyers were discussing Haddow and his companies’ assets, he was being arrested on an Interpol warrant in Tangier for his role in the Bar Works scam.

US authorities claim that the disqualified director in the UK had sought to hide his identity and connection to Bar Works, by using the alias Jonathan Black. Victims pointed out that the picture of Black, the chief executive, seemed to have been copied from another person’s profile on LinkedIn.

The alleged fraud involved dozens of high-pressure selling operations around the globe with takings siphoned through dozens of countries.

“It appears it was all smoke and mirrors,” said senior New York FBI official William Sweeney in June as he revealed the charges.

Haddow’s new Ukrainian wife, Zoia Kyselova – they were on their honeymoon last year at the height of the US investigation – played a role in the scam, according to a lawsuit filed by Chinese investors.

References to Bar Works on what appears to be her Facebook page are limited to a single statement from the company pointing to an “inexcusable breakdown in communications” with investors.

But her sporadic postings from the UK and the US do include a photo of Jordan Belfort, the boiler room operator and self-described Wolf of Wall Street, played by Leonardo Di Caprio in the movie version of his life. He was speaking at an event in the UK in 2014.

“Our team did a great work to invite this legend to London,” she wrote. The theme of the evening was “the truth behind his success, basically his steps and rules to become a successful entrepreneur”.

After moving from London in 2014, the pair had been living in New York when the US announced it was pursuing him for criminal activity. And about time too, victims say. It was not as if the authorities in Britain were unaware of past schemes.

Analysis of Haddow’s previous business activity suggests that the operation in Sierra Leone followed a decade-old pattern.

Haddow, now 49, has been behind a series of eye-catching projects that initially attracted interest but were followed by unfulfilled promises and the loss to investors of millions of pounds. Publications that have highlighted problems with Haddow-related projects have been threatened with legal action.

The former accountant, who first appears in UK corporate records as a director of a small public house chain in 1998, launched a project with similarities to the Bar Works operation in 2001.

As finance director of Branded Leisure, he struck a deal with the publishers of Cosmopolitan magazine to launch a string of venues that would combine bars, beauty treatments and coffee shops aimed at women aged 18 to 35.

The deal with the publishers involved regularly opening new outlets. Haddow had mooted 20 in two years. An assault on the US was seen as the next step after winning over Britain.

They opened only one, in Manchester, which failed to hit financial targets. Haddow’s company closed shortly afterwards.

Shareholders lost all their money and the company left debts of £2m. The saga resulted in Haddow being banned as a director in 2008 for eight years over misleading statements to investors about the state of the business, the insolvency report said.

While the beauty treatment and cafe plan was going to the wall, he came up with another project to rebrand milk as “M”, a trendy bottled drink aimed at youths.

“We want M to do for the milk industry what Perrier did for the water industry,” he said. But the plan failed to take off.

Even while he was banned as a director, Mr Haddow re-emerged as a consultant with a proposal to buy The Observer, the world’s oldest Sunday newspaper, and turn it into a weekly magazine. Again, the plan never got off the ground.

But the headline-grabbing projects were only a small part of his portfolio. Haddow was at the centre of a network of about 30 entities running investment schemes linked to commodities including gold, platinum, carbon credits and palm oil, largely run from London, an investigation by the World Policy Journal found in 2015. Sales staff targeted retired people on “sucker lists” with high pressure techniques, it said.

“I was first made aware of Capital Alternatives when they contacted my mother, an Alzheimer’s patient, and I stepped in to ask them to leave her alone,” said a victim quoted in a US think tank’s report. “Soon their calls were directed at me.”

The tactics were similar to those described by the FBI’s charges against Haddow, unsealed in June. One witness described brokers “badgeri

ng, harassing and shouting at prospective investors”.

The proceeds from the operations were allegedly moved through a complex web of offshore companies and tax havens.

The journal claimed Haddow became a well-known figure in Cyprus, a significant offshore banking centre.

He also promoted a hotel ownership scheme with property in places including Prague, Slovenia and Marrakesh. Investors bought a share of the hotel and shared in its profits, and allowed the investors to stay in the room for free at points during the year.

The company, Room To Invest, went into liquidation leaving debts and unhappy investors. One was encouraged to transfer his investment into the Sierra Leone farm investment scheme, a report in Money Observer said.

A man purporting to be Haddow has denied the central accusations against him through the comments section of an activist website that has helped to expose boiler room operations selling worthless carbon credits to unsuspecting customers.

He said his operations had raised a “fraction” of the $180m claimed by World Policy Journal.

“According to that article $180m was raised, I have a share in a Cypriot football club, visited Cyprus numerous times and I have Russian connections. I have been to Cyprus only once and I don’t even like football,” he wrote.

Chris Lang, who runs the Redd-monitor website, said he could not be sure that the writer was Haddow. But emails have been sent by a person who identified himself as Renwick Haddow asking for posts about him to be removed and threatening legal action if they were not, he said.

Mr Lang said “there’s a tone that’s quite consistent in the comments that are left under the name of Renwick Haddow”. That tone is belligerent, unapologetic and damning of critics.

His approach to those who claim to have been ripped off by his network is at best cavalier. He told one: “Unlike you, I have better things to do than spend hours writing dribble.”

In his comments, he has repeatedly taken issue with the description of his projects as “scams” and had never been prosecuted or charged with a criminal offence.

He accepts that if the Financial Conduct Authority won its legal battle, he could face criminal charges. The comment was written a week before he lost a 2015 high court ruling over the legality of his schemes.

A ruling is expected this year in the authority’s case involving the farming project, and carbon credit schemes for Australia, the Amazon and Sierra Leone, which could result in a significant financial bill. Even though Haddow was disqualified as a director, the authority has painted him as a central figure in project.

But Haddow, in a prison near the Moroccan capital Rabat, is facing bigger difficulties as the US seeks to have him returned to his adopted home to face trial. If found guilty at trial he faces up to 40 years in prison.

Unlike you, I have better things to do than spend hours writing dribble