Smartphone Company Alleged To Be a Scam Defrauding 300 Investors of $10 Million (pcmag.com) 23
In a 2015 video, PCMag's lead mobile analyst Sascha Segan showed off "One of the coolest phones at this year's CES."
He's now written an article titled "How I Got Suckered by an (Alleged) $10M Phone Scam. The biggest mobile-phone mystery of the 2010s is finally coming to an ignominious end, as yesterday the U.S. attorney for Utah charged Chad Sayers, founder of entirely notional mobile phone firm Saygus, with conducting a $10 million fraud scheme. Saygus "had" a series of "phones" from 2009-2016 that existed as prototypes that the company took on trade shows and to press tours. There was never any real evidence of production runs. The U.S. Attorney now claims Sayers and associated took $10 million in investor money and lived on it without ever really planning to release a product. (I learned this via David Ruddock....)
The phone kept just...not happening. Sayers' genius was that he produced just enough prototypes to show off and kept them in a constant state of pre-sale... "DEFENDANT failed to disclose that device certification with Verizon expired in 2013 and was never renewed," the Department of Justice notes. A new version of the phone then popped up again in 2015, this one supposedly covered in Kevlar with 320GB of storage. Sayers flogged that prototype until early 2016, at which point he said it was coming "next month."
The Department of Justice says: "Between April 7, 2015 and January 10, 2017, DEFENDANT made at least 26 public statements on Twitter that its phone would be shipping 'this month,' 'this week,' or was otherwise launching, when in fact, it has never launched...."
Sayers kept going on press tours and buying expensive trade-show booths with prototypes of phones that would never hit the market, drumming up enough gullible mainstream press coverage (myself included) to presumably attract a continual stream of investors with his claim of being the next big thing.
He's now written an article titled "How I Got Suckered by an (Alleged) $10M Phone Scam. The biggest mobile-phone mystery of the 2010s is finally coming to an ignominious end, as yesterday the U.S. attorney for Utah charged Chad Sayers, founder of entirely notional mobile phone firm Saygus, with conducting a $10 million fraud scheme. Saygus "had" a series of "phones" from 2009-2016 that existed as prototypes that the company took on trade shows and to press tours. There was never any real evidence of production runs. The U.S. Attorney now claims Sayers and associated took $10 million in investor money and lived on it without ever really planning to release a product. (I learned this via David Ruddock....)
The phone kept just...not happening. Sayers' genius was that he produced just enough prototypes to show off and kept them in a constant state of pre-sale... "DEFENDANT failed to disclose that device certification with Verizon expired in 2013 and was never renewed," the Department of Justice notes. A new version of the phone then popped up again in 2015, this one supposedly covered in Kevlar with 320GB of storage. Sayers flogged that prototype until early 2016, at which point he said it was coming "next month."
The Department of Justice says: "Between April 7, 2015 and January 10, 2017, DEFENDANT made at least 26 public statements on Twitter that its phone would be shipping 'this month,' 'this week,' or was otherwise launching, when in fact, it has never launched...."
Sayers kept going on press tours and buying expensive trade-show booths with prototypes of phones that would never hit the market, drumming up enough gullible mainstream press coverage (myself included) to presumably attract a continual stream of investors with his claim of being the next big thing.
$10 mil?! (Score:4, Insightful)
Or order some crap from China and call it done, then quickly fade into obscurity, sipping margaritas on the beach and collecting interest.
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As the saying goes, if you owe the bank a million dollars, you have a problem. If you owe the bank a billion dollars, the bank has a problem.
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And if you threaten to band together with other countries and create your own currency, then your region has a lack of freedom problem.
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That's right there is his problem - he didn't think big. Add few zeroes, grease few other palms - and it's just misplaced optimism.
Or order some crap from China and call it done, then quickly fade into obscurity, sipping margaritas on the beach and collecting interest.
Exactly. At least Elizabeth Holmes and Theranos thought bigly.
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This.
And come up with a catchy name. Like 5G.
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Or order some crap from China and call it done
Precisely that. There were lots of factories around, in those years, just waiting for somebody to contract them, provide the brand name and logo etc, and they could have pumped out as many as the guy cared to order.
They didn't even have to be 'crap' as there were many quite reasonably priced and feature packed mobiles being designed and sold online, just with a brand name you never heard before, and no Android updates ever released.
For a relatively small costs (assuming he pocketed $10 million) he could ha
Seriously? (Score:5, Insightful)
The biggest mobile-phone mystery of the 2010s
Seriously? I have never even heard of this thing and I do keep up to date. And from the article:
Chad Sayers was a smooth-talking salesman who started showing up at the PCMag offices in 2009 with a claim that his proprietary video compression codec, on the new Android 1.6 smartphone he showed me, could enable two-way video calling over 3G networks in a way that hadn't been possible before.
I mean, that's some classic BS right there with magic compression codecs, I don't know what this journalist was expecting from a random dude with a prototype.
And he just raised $10 mill. Which is nothing nowadays. Con artists manage to raise billions easily in this climate, look at Theranos for example. Or Magic Leap. Or look at most of the stuff Softbank invests in. This is peanuts, definitely not a big mystery.
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Middle-out compression? (Cf "Silicon Valley").
Re: Seriously? (Score:3)
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Re: Seriously? (Score:4, Informative)
Indeed. If some guy out of nowhere claims to have revolutionised X then take it with a large bucket of salt and do some friggin research on it. But I guess with tech journos it's easier to disengage brain and just write some fawning credulous copy that sounds cool rather than actually doing some, oh, what's it called, ah that's it - journalism.
Re: Seriously? (Score:5, Informative)
Journalism - a key word. The Summary begins with: "PCMag's lead mobile analyst Sascha Segan"; and that is probably how he likes to think of himself. 'The guy who knows stuff.' But in reality he's a guy who writes for a tech magazine. The thing about these magazines is that it's hard to tell where the journalism ends and the advertising/PR begins. Like Fakebook, they are tools of the advertising industry. People like Segan write the fluff that fills the space between ads. He's a shill. His eagerness for a hot story and failure to act as a journalist got him in to this. If he can be honest with himself, he now has an excellent opportunity to self-evaluate. He could be a contenda.
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The biggest mobile-phone mystery of the 2010s
Seriously? I have never even heard of this thing and I do keep up to date. And from the article:
Chad Sayers was a smooth-talking salesman who started showing up at the PCMag offices in 2009 with a claim that his proprietary video compression codec, on the new Android 1.6 smartphone he showed me, could enable two-way video calling over 3G networks in a way that hadn't been possible before.
I mean, that's some classic BS right there with magic compression codecs, I don't know what this journalist was expecting from a random dude with a prototype.
But, even worse, this is not the first time this has happened.
Since the late 1990s, maybe earlier, con-men have taken millions from investors by claiming to have invented a miraculous new "compression technology" that would revolutionize data transfer speeds.
And it's always a lie, always a scam, and not one journalist ever says "Hey wait a minute, this guy has no tech background and we've never heard of him, and this new invention seems a little farfectched, maybe we should look into it more closely."
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Magic compression codecs are second only to free energy machines in the realm of pseudoscience and investment con games.
Read about Madison Priest and Zekko Corporation. He scammed multiple investors out of $6M with his magic compression box, and that was in 1998 dollars. Chad Sayers' con doesn't compare.
DEFENDANT (Score:2)
Always makes me think if this line in the TV show The Good Place [wikipedia.org]:
"If you want to try something spontaneous, I'm your guy. Almost everything I did on Earth I did without thinking or worrying about what would happen. That's how I got my nickname -- 'The Defendant'."
-- Jason Mendoza (Manny Jacinto) , The Good Place, S4:E6, "A Chip Driver Mystery"
Crowd funding (Score:2)
He could have made more if he used crowd funding websites like Kickstarter [slashdot.org] and Indiegogo [slashdot.org]
Mel Brooks would approve (Score:2)
Sayers' genius was that he produced just enough prototypes to show off and kept them in a constant state of pre-sale
The Producer.
Sounds like penny stocks for mining (Score:2)
What is up Utah? (Score:2, Troll)
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