OLD SPRUIKERS PRESENTING NEW SEMINARS

Kaye's former cronies target Kaye's former clients.

by Neil Jenman


In the financial year ended June 2003, property spruiker Henry Kaye raked in more than $60 million from get-rich seminars.

Kaye didn't teach many of his clients to get rich, but he did teach his cronies the magic get-rich formula – the best way to get rich is to hold seminars on how to get rich.

Today, some of Kaye's former cronies have stepped into his shoes, eager for a slice of the millions to be made from spruiking financial advice.

Take Grant Luke, for example. A former "consultant" for Henry Kaye's company, the National Investment Institute (NII), Luke was one of the last to leave Kaye's sinking spruiking ship in 2003.

Last September, when the Australian Competition and Consumer Commission (ACCC) was taking action against Kaye for misleading and deceptive advertising, Grant Luke was one of many NII consultants frantically signing up the victims of Kaye's deceit.

People like 53-year-old Nancy who attended Kaye's now infamous "Million Dollar Challenge" seminar where Kaye promised he could make any ordinary Australian into a property millionaire in just six months.

Grant Luke told Nancy that spending $15,000 on Kaye's wealth course would be a wonderful investment, just what a lady approaching retirement needed.

Nancy didn't have the money, so Luke signed her up for a loan with a finance company called AFD. The ink was barely dry on the loan contract when NII slammed its doors.

Henry Kaye and his cronies scarpered in all directions. With the money, of course.

Today, Grant Luke has set up his own spruiking business. Together with Ken Raiss, another former Kaye crony, the pair have started a company called Wealth Networks Pty Ltd.

According to their advertising material, Luke and Raiss have researched "the most effective property, business and share market systems in the world today". And, they are now offering consumers the "opportunity to become a global investor by learning techniques used by the wealthy to create great wealth."

And guess who they are targeting? The people they once signed up for Henry Kaye.

Oh, you've just gotta hand it to these fellas – they've got front.

A couple of weeks ago, Luke and Raiss (through their new company) sent Nancy an email inviting her to a seminar on July 4. It read, "Anyone who is serious about creating wealth via property needs to attend this event. Hosted by Dan McEwan of the successful New Zealand company Investors Forum. Dan has acquired $1.37 Billion of developments under construction. A Clever Man – would you say??"

Well, with New Zealand apartments predicted to crash and Kiwis shunning them, perhaps it is clever to target Australians by enlisting the help of former cronies of the once master spruiker, Henry Kaye.

Last Sunday, Nancy went along to the seminar, just for a look. More than a hundred people heard Dan McEwan talk about the retirement benefits of investing in New Zealand property. Yes, his New Zealand properties. Of course.

Er, no thanks, thought Nancy – enough damage has already been done to her retirement plans.

But it doesn't end there.

Last night, in Sydney, Nancy went to another wealth seminar. A few days ago, she received a call from a company called Lemrow Pty Ltd about "new ways to make your money work harder for you". How did they get her name and number? Oh, something about a company she once contacted.

The presenter at last night's seminar was none other than Steve Molnar, formerly one of Henry Kaye's most loyal cronies. Molnar worked with Kaye from 2000 until NII closed its doors in November 2003.

Beginning as a sales consultant, Molnar's talents as a spruiker took him to the position of senior seminar presenter for NII.

In hotels and conference halls across the country, Steve Molnar spruiked Henry Kaye's get rich message. He told thousands of people that he had personally managed to buy 18 properties worth $7 million in just one year by using only $21,000 of his own money. It was so "easy" and it had all been "learnt from Henry".

After hearing Molnar's message, consumers signed up in droves. And lost their money.

Last night, he was at it again. Telling the audience to "get smart", he urged them to become part of Lemrow's "Smart Money Network". According to Molnar, the banks are "sneaky" because they could "throw you out of your home".

Yes, that's right, folks, don't trust the banks, trust me, Steve Molnar, former spruiker for Henry Kaye now spruiker for Lemrow (owned by Paul Lemme, who also spoke at some of Henry's seminars – and Kenneth Rowntree).

Singling out someone from the audience, Molnar asked for details about their family home, how much they paid, what it is worth and how much they owe. Once he received this information, he then said, "Well, it's Christmas and I am Santa Claus."

Nancy sat there wishing Santa Steve would give back the money she paid to his former company. But that's not how the spruiking business works. Spruikers take money, they don't give it.

Molnar kept assuring the audience – just as he did during those years with Henry Kaye – that everything is "safe" and "without risk".

His most truthful line was, "You have to be careful who you are receiving your advice from.

"This is a financial game and you need an expert," Steve Molnar told the audience.

Darned right they do. They need an expert in consumer protection. Someone who can give the order to close these spruikers down once and for all.


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Notice to spruikers. Tell your lawyers not to bother with any threatening letters. We all know there is more to this story. The best advice for you is to STOP SPRUIKING. The ACCC is showing signs of being committed to protecting consumers from false and misleading promotions. If you're not careful, ASIC might get serious about the financial advice you are dishing out.