— This is a tale of an author and an alchemist. One writes books about corporate governance, and the other says he can make mercury into gold. That's a feat that alchemists and assorted mystics of the Middle Ages, who claimed they could transform base metals into gold, couldn't have pulled off.

The author, San Diego attorney Michael D. Spadaccini, and the self-proclaimed alchemist, former San Diegan and jailbird William L. Telander, are among a group of companies and individuals charged by the Securities and Exchange Commission with running a "hype and dump" fraud. Allegedly, they were selling unregistered shares of Illinois-based Wind Farming, which supposedly was selling energy windmills to farmers but mainly was a fantasy pumped up by a publicity machine.

The charges were filed in late July. Last week in federal court in Chicago, the company agreed to a permanent injunction barring it from breaking securities laws. Preliminary injunctions were instituted against Telander, San Diego penny stock peddler Anthony M. Necoechea, and companies that had been set up to sell U.S. Wind Farming stock. Telander's assets have been frozen, and he has resigned as head of the company. He is now in Napa Valley.

In the early 1990s, Telander was running a supposed foreign currency trading operation, Southwest International Exchange, from the basement of his grandmother's house on Eagle Street. He promised annual returns of 25 to 41.6 percent to investors from San Diego and Orange counties and assured them that their funds reposed safely in Switzerland. This pitch was similar to that of J. David Dominelli, whose Ponzi scheme had rocked the community less than a decade earlier.

Alas, history did a rerun. Telander's investors didn't get their money. In 1994, he admitted to defrauding 380 victims of $11 million. He was sentenced to 37 months in prison and served half the term, later finding his way to the Chicago area.

Telander admits that some of his Southwest International Exchange investors' money went into his so-called Philadelphia Project, named for an experiment that Albert Einstein had run decades earlier in that city. Telander provided the funds to a Texas A&M University chemistry professor, John O'M. Bockris, to experiment with modern-day alchemy in his laboratory. They claimed they turned lead and mercury into gold; skeptics cocked their eyebrows.

Telander fed the university $200,000. A friend of Telander's, Joe Champion, helped in the lab. Champion landed in jail too. Champion "was cleaning out my bank account -- $35,000 a day," claims Telander, but Champion went to the slammer for an unrelated charge of passing a bad check.

Texas A&M was embarrassed. In Texas, the butt of a dumbbell joke is almost invariably a "Texas Aggie." One professor said Bockris's research had turned into "a typical Aggie joke." Another said Bockris was "a disgrace to science" who was "consorting with known stock swindlers to support his sleazy so-called research." The Aggie professors were particularly suspicious, because Bockris had been involved with questionable science before. He had declared that cold fusion -- purported nuclear fusion at or near room temperature -- was "the greatest discovery in energy of the century." Cold fusion has been touted but not convincingly demonstrated.

The university investigated the $200,000 gift and vindicated Bockris, but the faculty was unappeased. Bockris has since retired and could not be reached for comment. However, he wrote an online paper defending the whole adventure.

Telander has not lost his enthusiasm, as a wide-ranging interview reveals. "We did positively prove we could convert mercury into gold," he insists. "But it was a political hot potato." He says that one time in Mexico officials of the U.S. Central Intelligence Agency and Federal Bureau of Investigation told him he had to go see Interpol, the international criminal police organization. "There were guys on the roof with machine guns," claims Telander. The alleged Interpol sleuth said the Chamber of Mines of South Africa was told that "your technology will destroy the whole precious metals industry. I can't believe somebody hasn't taken you out."

Back in the early 1990s when investors couldn't get their money, they were told that U.S., Swiss, and South African officials were secretly tying up Telander's assets because they fretted that the Philadelphia Project would toss the world into financial chaos. Few investors bought the alibi.

Now hear this: Telander asserts he has a process for extracting high-priced metals such as platinum and palladium from the tailings of closed-down mines. What's left over "can be turned into an excellent replacement for portland cement," he asserts. "The only waste we have is salt." But he has a problem attracting capital: "I have to be careful how I raise money because of my past."

He claims to have developed a very special mineral: "We can stop a 44-magnum bullet at ten inches," he avers. Both of these purported inventions are now controlled by U.S. Wind Farming, he says. "The SEC [has] no idea of these assets."

The filing by the Securities and Exchange Commission mentions windmills -- not purported platinum extraction from mine tailings. The agency charges that Telander put "fraudulent and misleading" press releases on the company website. For example, the company said in a press release that it had a $10 million grant from the Polish government to develop a wind farming cooperative. There was no such agreement, says the agency. And he never told investors that he had previously gone to the hoosegow and been permanently enjoined from committing securities fraud.

According to the agency's complaint, Spadaccini and other individuals set up companies with names like Mad World Capital, Kyoto Capital, Oronex, and Ashlin Capital to sell unregistered shares in Wind Farming. Spadaccini was selling the shares to get fees for his work in the adventure, says the agency. Telander issued the companies 150 million shares in the year ended March of 2005. More than 60 million were sold to the public at prices from effectively zero to around five cents, says the commission.

Necoechea alone sold 22 million unregistered shares to the public through an unregistered firm he controlled, according to the agency. He is not a registered broker with the National Association of Securities Dealers. Regulatory filings indicate that a Tony Necoechea twice failed his brokerage exams in the 1990s while with Desert Mountain Securities, a penny stock brokerage that handled the stocks promoted by Melvin Lloyd Richards, a San Diego stock tout who ended up in prison. After four days trying to reach Necoechea's lawyer, I gave up.

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