Charter School Operators: PonzEd

As we continue our profiles of preferred charter school bidders, My Thinks was excited to get the chance to talk with former investment banker and convicted fraudster Sir Phillip John. Sir Phillip amassed his fortune in the 1980s by successfully investing public service pensions in the Peruvian stock exchange. 

The bell rings heralding the beginning of trading here at Mertyl Lunch. Investors and brokers begin shouting down their phones or at their computer screens. Buy! Sell! Hide! It appears to be pandemonium but you know at the end of the day every single person in this room will be slightly richer. If they aren’t, it doesn’t matter. It’s not their money anyway.

Sir Phillip John strides confidently into the room. He holds himself with the aire of someone who, having spent time in a luxurious medium security correctional facility, is now preparing to give back to the community in a court-ordered fashion. There are a few waves from the assembled investors, many of whom would not have even been born in the days when Sir Phillip made his first million investing in a block of land on Bastion Point in Auckland.

“Right everyone!” he announces, “I have the school fees for the current term in an account. Let’s grow them exponentially!”

The brokers welcome the new cash. Some light cigars while others head to the toilets rolling hundred-dollar notes into tight little straws.

Later that day, with the school fee account now half what it was, we head back to the office. Sir Phillip makes a brief reference to “unconventional market influences” before suggesting we head back after lunch to try to make our money back. I don’t have the heart to tell him it isn’t my money.

Back at the site of his charter school Sir Phillip is sitting in his office playing with a Rubik’s Cube. There are other signs of the 80s on his desk. A Huey Lewis and the News compilation album, a set of 5 metal balls on strings bouncing against each other, and some leg warmers. He manipulates the cube for a few moments with an almost reticent look on his face. You almost think he might be concerned that half the fees have disappeared in 30 minutes of furious trading. He then announces that getting one side is impossible and throws the cube at the door. I choose this time to begin questioning him about his new charter school.

What makes you qualified to teach young people?

“I know what makes young people tick,” he confidently announces, “because I am a man of the people. We all need a brighter future and this school will provide it.”

I ask what he means by “brighter future” but he continues as if I’m not there.

“When you are worldly-wise like I am there are many important things you can pass on to young people. I’ve made and lost millions over the years. My wife currently appears on the ownership papers of everything I touch. I have a shell company in the Bahamas where I funnel my various income streams. I haven’t paid a cent of tax since 1983 when I left university in disgrace.”

I’m uncertain where this dialogue is heading.

“These are all excellent life skills that any young person needs.”

He hands me a glossy brochure featuring information about his charter schools. Financial literacy, Creative Accounting, and Mysterious Management (Mys-Management) are all offered by his uniquely capable institution. I open the brochure and inside is a single info-graphic listing how many beneficiaries have ripped off the taxpayer in the last 7 years. I’m uncertain as to how this relates to educating young people until I read the school’s mottos at the bottom of the page – You will be on the dole if you don’t enroll.

Sir Phillip leaps up from his expensive leather chair and motions to me to head out into the classroom area. It resembles the brokerage room we attended earlier in the day. Rows of desks with computer screens, clocks on the wall showing the time in London, New York, Sydney and Shanghai, and a large LED ticker displaying the current share prices at the NZX.

“Look at all of this,” he says sweeping his arms across the room, “the government have a 70/30 split in all of this. They’ve invested 70% of the money and I’ve supplied 10%. We really want to provide the best quality education for our young people. What better way to do that than get them investing in real markets, making real money and delivering real commissions back to their head-master.”

Our day concludes back on the trading floor at Mertyl Lunch. Several brokers appear to have less hair than when we started our interview earlier in the day. There are certainly some red eyes and at least one desk has a greying sheet covering the computer terminal and a small white cross next to the keyboard.

As I leave Sir Phillip has positioned himself in the “Double-or-Nothing” Zone preparing for an afternoon of hard work attempting to reinstate his school account.

Godspeed to him.

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