The Barton Watson Blog: CyberNET, His Life and Everything

NEWS FLASH! The Story of CyberNET and Barton Watson on TV!

2008-03-10T12:42:00.004-04:00

A one-hour special episode of the CNBC series "American Greed" will be airing this Wednesday, March 12, at 9:00 p.m. EST, profiling the wild life of Barton Watson and his many scams, including the CyberNET con. Narrated by Stacey Keach, this documentary has been months in the making and is based on my book, "Virtual Millionaire." Extensive Interviews with Barton's past loves, employees, and victims will make this a compelling show, (not to mention several interviews with me.)

View the casefile at:

http://www.cnbc.com/id/23240391/site/14081545/

CNBC cable network

Wednesday, March 12, 2008

9:00 PM EST, repeat at 12:00 midnight EST

The Sentencing of Paul Wright: An Eloquant Voice for an Clumsy Man

2007-12-15T12:44:00.001-05:00

Paul Wright, Barton Watson's family butler, was sentenced yesterday to 30 months in prison. Paul's actions in furtherance of the grand CyberNET scam were to:

Agree to be the president of a shell company
Swap serial number stickers on servers in the dead of night
Open up dozens of P.O. Boxes at UPS Stores around the country in the name of various Fortune 500 companies
Cash a $12,000 check made out to him, and give the money to Barton

Most noteworthy about the sentencing was the eloquance of his attorney, Paul L. Mitchell, Esq., in the sentencing memorandum. Few others have captured the spirit of this case as well. I have provided an except below:

Paul Wright was a childhood friend of Karl Watson, Barton Watson's half brother. Paul and Karl played in the high school band in Belding, Michigan. It was through this friendship that Paul got to know Karl's mother Geraldine Watson, Paul subsequently left Belding and lost touch with the Watsons until, back in Grand Rapids in the late nineties he bumped into Geraldineat a grocery store. The friendship was rekindled and Geraldine apparently persuaded her son Barton to hire Paul in his company. This proved to be the fork in Paul Wright's life road. Unhappily he took the road to temporal perdition and began to work as Human Resources manager for Cybernet. He discovered early on that the Watsons were difficult to work for and hard to please as his stock as H.R. manager went down.

Perhaps out of a sense of perhaps of mutual loyalty they kept him on and he stayed on, his position with the company metamorphosized from position to position until he became a personal servant to the self aggrandized Barton Watson (now Barton Watson IV the scion of an Eastern Establishment family and the graduate of Connecticut prep schools and ultimately a man of impeccable Ivy League credentials. Belding, Michigan being a mere speck in the rear view mirror of the Rolls Royce.)

Throughout this time the company was to all outside and inside appearances the very essence of success, its leader a man of both extreme intelligence and extreme good taste. The company moved to opulent surroundings on South Division in these salad days. Paul Wright, whose average wages during his entire time at Cybernet were never greater than approximately $40,000.00 per annum (a amount which included rent on this Heritage Hill apartment) felt safe in the obvious success of the company. Only three or four people knew of the precarious nature of the company's fortunes and those people did not include the defendant. Paul Wright did everything demanded of him. He was required more often than not to take Geraldine to lunch (Barton's orders), to drive clients to and from the airport in the company limousine, to wait on Barton hand and foot and to do little jobs for the company, such as change the serial numbers (at night) and open mailboxes using names not really associated with the company. Like Paul, other employees did some of these small jobs, which fit a larger crimnal object, but Paul probably did more. None of these employees have been charged, although one can be assured that their names appeared on the government's never revealed witness list.

Eventually the defendant spent most of his time cleaning the Watson's house and keeping house. Also during this time Paul was treated cruelly by Barton and his wife, Krysta Kotlarz Watson. He and his work were never good enough but his loyalty and his sensibility were too good to lose. The Watsons stole the silver and the glorified butler Paul Wright was relegated to polishing it.

Krista Gets a (Small) Christmas Present

2007-12-11T11:09:00.000-05:00

Barton Watson's widow, Krista Kotlarz-Watson, was sentenced this morning by Chief Judge Robert Holmes Bell in Grand Rapids. Her plea bargain was that that the prosecutors would ask for ten years and she could argue for less. She received a sentence of seven years, even less than the 7 1/2 years that Jim Horton got from the same judge.

Basically, Krista got the best sentence she could have reasonably expected. Whatever she might think of the sentence, she got lucky. Here is how it happened.

First, the federal sentencing guidelines are a significant factor in any sentence. At one time they were mandatory, but since a recent Supreme Court decision, they are only "advisory." As a result, judges can deviate from them, but rarely do so, at least not very much.

The guideline sentence recommendation is based on a complicated formula. The federal probation officer who prepares the pre-sentence report does the initial calculation, but the judge has the final say.

In this case, the probation officer scored Krista higher than Jim Horton. Krista's attorney objected, saying they pleaded guilty to the same crime so the starting score should be the same. The judge appeared to agree with this argument, so the basic term of incarceration was 87-108 months.

Next, the probation officer added to this basic term because Krista was found to be a "manager or supervisor" of the scheme. On top of that, the sentence recommendation was further enhanced by a finding that Krista obstructed justice by withdrawing $20,000 of the secret money that Horton transferred a few days after the raid.

Krista objected to both of these enhancements, arguing that she "did not have enough knowledge or the ability to plan and organize this fraud. She was a 'soldier' that performed the tasks assigned to her just like the others involved in the fraud with the exception of Barton Watson and Mr. Horton."

Likewise, she argued that just because Horton transferred the money into her account doesn't make her responsible for that act, and that she did not obstruct justice by hiding money.

The judge appeared to reject her arguments, saying that she "represented herself as being in charge," and noting that the $20,000 she withdrew was never recovered. But despite these stern words, the judge gave her a mere 84 months, less than what the guidelines recommended even without the enhancements.

Still, seven years is a long time. Krista will not get to see her daughter grow up, and mommy will be a stranger when she gets out. Whether it was all worth it, seven years in prison for twelve years of luxury with Barton, that's a judgement only Krista can make. Krista remains free on bail until she is told which prison to report to, probably within the month.

Krista's lawyer described her situation like this:

"Ms Kotlarz is very aware of her conduct and how she assisted in the large fraud. However, there is no doubt that she was not the 'brains' behind this fraud. She was the wife of a diabolical, evil individual that used others to feed his substantial ego. As it pertains to material items, Ms.Kotlarz did benefit from this fraud. However, in all other areas that relate to quality of life she has paid a tremendous price. She was mentally and physically abused throughout her time with Mr.Watson. She became an alcoholic to numb her pain. Her husband, Mr. Watson, killed himself and left her and others to pay for his greed and grieve for his loss."

I would take issue with part of this statement. Barton Watson could have stayed overseas and possibly avoided extradition for years. Over $5 million dollars are unaccounted for, and are probably still hidden somewhere in Asia. Barton returned to the USA after the raid so Krista would not have to face the collapse alone.

Perhaps Jim Horton best summed up the role Krista played when he said, "Krista was the only person who could have stopped Barton." This may have been her greatest crime of all.

A Dark Mark on the Passage of Time

2007-11-24T18:38:00.000-05:00

Three years ago today, Barton Watson took his own life. To mark this occasion, I am sharing an exerpt from Chapter One of Virtual Millionaire:

Eventually, Barton reached for the $200 shotgun his mother had bought him. With the Dictaphone still recording, Barton loaded the magazine to capacity, four cartridges containing buckshot. He pointed and fired into the wall next to his wife’s closet. It was the first time he had ever fired a gun and the recoil hurt his shoulder. Barton then fired another shell at the ceiling of his bedroom. “Shot one shot through the ceiling to make sure I knew how to do it,” Barton slurred into the Dictaphone. “That was the second shot. Did one shot through my wife’s closet to know that she knew I knew how to do it.”

After another bottle of wine, Barton became bored with the Dictaphone and turned again to the telephone. Through the alcohol, an idea came. Barton realized that there was still someone who he could call, someone he could count on to listen, and maybe even help him make sense of what was going on in his mind. Barton dialed the magic number, 911:

“911 Emergency,” the dispatcher answered.

“Hello,” Barton replied.

“Hi, this is 911 Emergency…what's your emergency?”

“Yeah well…there's a gun in my mouth,” Barton said, matter-of-factly

“There’s a what?”

“There’s a gun…in… my…mouth.”

“Okay…why’s there a gun in your mouth?”

“Well, you should transfer me to somebody who can deal with kind of thing,” Barton said with an awkward laugh.

“Okay. What’s going on?” the young dispatcher replied, not easily put off.

“Come on. Come on! There must be someone…,” Barton insisted.

“Sir, don’t do that.”

“C’mon. Talk to me. Send me to somebody who can talk to me.”

“Okay, are you the one who’s holding the gun?”

“No kidding,” Bart answered.

Barton sounded relaxed, but weary. To him, this was just another cold-call where he couldn’t get past the receptionist. Surely there must be someone else, a supervisor at least, who he should be speaking to. Barton knew important people never answer their own phones.

“Okay. What kind of gun is it?” the Dispatcher asked.

“C’mon guy. It’s one that can deal with the reality of the situation."

“Is it a handgun?”

“No… it’s a twenty-gauge shotgun,” Barton lied. It really was a twelve-gauge, but maybe Barton just didn’t know any better. To Barton, “twenty-gauge” sounded bigger than “twelve-gauge,” even though the opposite is true. “Relax,” Bart urged the dispatcher.

“Are you trying to kill yourself?” the dispatcher replied.

“No relax, it’s okay, relax. This is a miserable situation for you. Relax,” Bart said with an embarrassed laugh. “You shouldn’t have to deal with this. I know.” Bart sounded genuinely apologetic.

“We do have help on the way, okay?” the dispatcher urged.

“I know…but…you know…you think I would make this call if I wasn’t ready?” Bart replied gravely.

“I just want to know why you want to kill yourself?” the dispatcher asked.

“Well…have you watched the news lately?” Bart replied coyly.

“Um…some,” the dispatcher answered.

“Some?”

“Channel eight?” Barton asked.

“Yeah”

“I’m the missing channel eight CEO,” Barton says with delight.

“You’re the missing channel eight CEO?”

“Yup.”

“Okay. And what business are you from?” the dispatcher answered.

“You know. C’mon. CyberNET?”

“Oh.”

“Yeah. ‘Oh,’” Barton laughed.

“I did hear about that. Just briefly though. I didn’t…”

“Yeah a little bit…here and there. Okay,” Barton laughed, but his tone then changing to deadly serious. “It’s over.”

“Okay. Sir, I don’t want you to do anything…”

“Relax!” Barton shouted. “Don’t…don’t give the rhetoric. Just relax.”

“Is there any way you could put the gun down?” the dispatcher pleaded.

“No…it’s a little late for that,” Barton replied.

“We want to get help to you. We don’t want you to hurt yourself.”

“I know. I know. I know,” Barton replied painfully. “I know and you know the theory is I wouldn’t call you if I didn’t want help, right?”

“Right.”

“Right,” Barton replied. “But, I just want somebody to clean up the mess.”

At that very moment the sheriff’s deputies were coming with blue lights and sirens; deputies with guns who were more worried about getting shot than about Barton shooting himself. Barton was done merely flirting with the idea of suicide. Making the phone call put him a step closer to actually pulling the trigger. The arrival of the police cars at the house was about to bring him another step. Whether he could actually bring himself to do it or not, Barton was still unsure.

An Open Message to the CyberNET Six

2007-09-24T23:46:00.000-04:00

As Jim Horton and Jonathan Mast sit in prison, as Dave Roepke and Geraldine Watson contemplate why they were spared that punishment, and as Krista Watson and Paul Wright await their own judgment, they would do well to consider the following.

On May 11th, 1987 in Washington D.C., the legendary Watergate/Iran-Contra/Pentagon Papers Judge, Gerhard A. Gesell (b. 1910, d. 1993), sentenced Barton Watson to prison for Mail Fraud. These were his final words of advice to Barton:

"I want to say something else to you. You won’t necessarily agree with what I’m going to say but I’m going to say it anyhow. You’re right, the job I have is not the easiest job, this aspect of it, and you realize that. It has been somewhat surprising to me how many people in your similar circumstances, and I’ve seen a good number of so-called white collar criminals, many have actually found that a period away from all the decisions and a period to think over their life is beneficial. I urge you, it’s up to you, not to say, well, the old judge just threw the book at me and feel the world has mistreated you. I think you’ll be well advised to think over where you are and work out the kind of life you’re going to have to follow if you’re going to meet the obligations you’ve indicated to me you want to meet. You’re out of the fast track, you’ve got to stay out of it, and you’re going to have to find a different way to conduct yourself and I hope that you’ll find in prison a chance to think it over."

Krista Pleads.

2007-09-04T19:09:00.000-04:00

The last CyberNET criminal case ended today with a whimper, rather than the bang that ended Barton's criminal case. Krista Watson pleaded guilty pursuant to a plea bargain this afternoon. Quite a bargain it was too. Krista had been facing six federal felonies, under which the maximum penalty could have been thirty years if she had gone to trial. Under the plea bargain offered by the U.S. Attorney's Office, she had four of the most serious ones dismissed, and she was allowed to plead guilty to one count of wire fraud and one count of tax evasion. Under each she faces only a five year maximum, however, the judge could choose to run the time on them "consecutive" to each other and give her a total of ten years.

This is arguably a better deal than Jim Horton got, who was made to plead to four felonies, including one with a thirty year maximum. After various aspects of the plea agreement regarding downward departures because of his cooperation were considered, and because of the fact that Judge Bell seemed to find Jim Horton a genuinely remorseful guy, he gave him 90 months (7 1/2 years). Remember, Horton cooperated from day one.

But the deal may not be so great for Krista after all. Judge Bell has broad discretion to give her the ten by running the sentences consecutive, and need only find that "the sentence imposed on the count carrying the highest statutory maximum is inadequate to achieve the total punishment." Five years for Krista is inadequate.

There is a very high likelihood that Krista will get the full ten. If I were a betting man.... Does Vegas take odds on sentencings? Sentencing is December 11th.

The photo of Krista was taken In January 2003 in the desert outside of Dubai, in the United Arab Emirates. She and Barton went on a falconing trip arranged through their luxury hotel. The activity involves taking a captive hawk and using it to hunt smaller animals. The photo seemed appropriate somehow.

News Flash! Krista and Paul Wright Agree to Plead Guilty!

2007-08-30T12:43:00.000-04:00

Hot off the cyberpress:

This morning Krista Watson and Paul "The Butler" Wright informed the court that they intend to plead guilty. Paul will plead guilty tomorrow at 11:00 AM, and Krista on September 4, 2007 at 3:00 PM at the Grand Rapids US District Court. Their sentencings will almost certainly take place at a later date and at least in Krista's case, may be quite a show.

This means that both reached a plea deal with the prosecutors.

In Paul Wright's case, the plea agreement calls for the dismissal of the 3 of most serious charges that carried the potential for up to 30 years in prison, and the ability to plea to two less serious charges with a maximum penalty of only five years. Paul can then argue for a lower sentence than the maximum.

In Krista's case, the plea agreement has not yet been released. The gist of Krista's sentencing argument will likely be that although she committed fraud she did it at Barton's insistence, perhaps even under duress.

Pleading guilty is a wise decision by Krista. Her defense that she was forced by Barton to do this will play far better as a sentencing argument than as a defense. Furthermore, she had little chance of leniency if she had lost after a full jury trial. She still may get rather little leniency.

An Amazing Discovery

2007-07-20T16:01:00.000-04:00

Early in my research, I spent the better part of an afternoon at the Belding Public Library looking for the following newpaper article. Sadly, their collection was missing this issue. Several years passed, and then though sheer luck I came across a copy of this article in my parent's papers. My mother, for whatever reason (though perhaps the reason is obvious), kept this for 34 years.

People often ask me, "Why was Barton the way that he was?" This newspaper article from July 26, 1973 explains all one needs to know to understand the how and why. As the Jesuits teach: "Show me the boy and I will show you the man."

http://www.cybernetscam.com/beldingbanner.pdf

(NOTE: This is a large, 17mb PDF file. It opens with Adobe Reader or Adobe Acrobat, both widely available. Reader is a free download from the Adobe website. If you have difficulty getting the file to load, try right-clicking on the link and selecting "save target as." Then open the saved, downloaded file. You will need to rotate the image counterclockwise 45 degrees using the controls in the Adobe toolbar. You can zoom in without loss of resolution to make it easier to read -- I recommend 200%.)

Book Update

2007-04-28T16:17:00.000-04:00

I want to thank the hundreds of persons who have emailed me asking to be kept up to date on the progress of the book. I have currently completed 542 manuscript pages, and am now writing about the events of late 2002 & early 2003. I hope to finish the book by mid-summer, with further revisions as necessary to incorporate information that comes out at Krista's trial. Until the trial is done, the story has not completely unfolded. Who ever thought that this case would take three full years from the the suicide until the final defendants would be adjudicated?

Behind the Sentencings

2007-04-28T13:55:00.000-04:00

James Horton, David Roepke, and Jonathan Mast have all pleaded guilty and have been sentenced. Who got a tough sentence and who got leniency? It can be rather hard to tell unless you have a little background knowledge about the sentencing process.

James Horton: Horton got a favorable, relatively lenient sentence. He pleaded guilty to a bunch of charges, including one with a maximum sentence of 20 years and one with a maximum sentence of 30 years. He received as a sentence 90 months incarceration to be followed by 3 years probation. His special conditions of probation included that he was to undergo a substance abuse evaluation (he began to drink a lot working for Barton. Who wouldn't?). Part of the reason Horton got a sentence substantially lower than the 30-year maximum was that he cooperated with the authorities and did so in a forthright and honest manner. This cooperation (30 hours off interviews) was considered by the prosecutors to be of "substantial assistance," resulting in a motion by them to reduce Horton's sentence below the sentencing guidelines. As a result, Jim Horton got one-quarter of the maximum sentence.

Dave Roepke: Dave got a major break. As I have said before, the worst that can be said of him was that he ignored what was going on around him because he believed Barton's lies. This is hardly a moral failure. Barton was a VERY good liar. His crime was, on the last day CyberNET was in business, he made a couple wire transfers from the fraudulent shell companies to various persons including himself. The leniency Roepke was less given was a result of his minimal involvement in the hands on frauds, not so much as a result of his cooperation, although he did sit down with investigators and tell what he knew. The sentence was so lenient that the US Attorney's Office is taking the rare step of appealing the sentence. This is an uphill battle for them.

Jonathan Mast: Jonathan got hammered by the judge. It cannot be said that he received any leniency whatsoever, since the judge sentenced him to the maximum possible sentence that he could: five years. Jonathan presents a dilemma for those who would presume to judge him. He was Barton's best friend for years, going to strip clubs with him, and racing SUVs up and down sand dunes. He was referred to by everyone at CyberNET in the earlier years as "Barton, Jr." as he emulated Barton in every way possible, in his bullying manner and his obesity. Furthermore, when Barton lied, Mast would swear to it. Unlike Horton, who was universally popular among staff, Mast was disliked.

According to Jonathan, by the time he met the woman who would become his third wife, he began to undergo a moral transformation. Having dropped out of Calvin College, Mast could be called a lapsed Christian during most of his time at CyberNET. At first, Jonathan was willing to make fraudulent telephone calls to lenders and lie to them, pretending to be an employee of Teleservices. Finally, Barton needed Jonathan to actually meet with a lender in person and continue the masquerade. Jonathan refused to do so, and Barton was furious. After this refusal, both Jonathan and Barton knew that he was no longer of any use to Barton and would have to leave. Saying no to Barton was certainly difficult to do, and certainly represented Jonathan reaching a limit as to what criminal acts he was willing to do.

After leaving CyberNET with a modest severance package, Jonathan sold used cars for a time, and then retreated completely into his local church and his small hobby farm. At sentencing, Jonathan was able to muster some 22 letters from friends and (mostly) people he met through church. The letters almost all were from people who had known Jonathan less than three years, and expressed the opinion that "nothing would be gained by sending him to prison." In support, they cited Jonathan's renewed faith in Christ. It is quite obvious that Jonathan honestly hoped for a sentence similar to Roepke's no jail sentence, or at least, as his lawyer said, "substantially below" the 60 month maximum.

Jonathan also make a rookie mistake at sentencing. His sentencing memo whined incessantly about how Barton was responsible for influencing Mast's conduct. The last thing any judge wants to hear at a sentencing hearing is about how it was all someone else's fault. Sentencings are about the person being sentenced. Casting blame broadcasts a lack of remorse and an unwillingness to own one's actions.

In short, Jonathan's sentencing argument was, "Give me a break, Judge, because 1. I am a Born Again Christian, and 2. Barton made me do it." For whatever the reason, the sentencing judge was buying none of it. Jonathan got the maximum sentence.

The Sentencing of Sgt. Schultz (Dave Roepke)

2007-04-21T14:18:00.000-04:00

David Roepke, CyberNET's "CFO" or "Comptroller" depending on when and who you asked, was sentenced this week to straight probation -- no prison time at all. You can read his lawyer's sentencing memorandum here and Roepke's heartfelt hand-written letter to the judge here.

Some may criticize the sentence. However, I would like to come to Dave Roepke's defense here. I have read thousands of emails and reviewed an equal number of primary source CyberNET internal documents. I have interviewed over fifty people. Other than the fact that Roepke made the wire transfers in the days after the FBI raid, I have found no evidence of any criminal wrongdoing by him whatsoever.

Roepke's job title of CFO was rather overblown. Dave was basically a glorified accounting clerk. His job was to calculate how much CyberNET was in the red each month (millions!), and tell Barton the number. Barton would then wire transfer that amount into the CyberNET account from the shell company bank accounts. Roepke would then pay the bills. Barton's explanation to Roepke was that the money was from his vast personal wealth, and that he was simply supporting CyberNET's losses with his own money.

Updates!

2007-04-07T17:31:00.000-04:00

Mother Watson:
On February 26, 2007 Geraldine pleaded guilty pursuant to a plea bargain where she agreed to testify against Krista and Paul Wright, the man who provided personal care for her from 2001-2004, and who was a dear personal friend -- almost a surrogate son -- for thirty years.

Her guilty plea resembled a cross between a sideshow and a Greek Tragedy. She appeared in court, chatting brightly with the bailiffs and commenting on the size of a female court employee's engagement diamond. Then, she made strange comments to the judge during her guilty plea, such as professing ignorance that Barton had been a convicted felon, while at the same time admitting guilt in furnishing him the gun he used days later to kill himself. This denial of knowledge that Barton was a felon was so absurd that it caused her son Karl to loudly whisper, "of course you knew mother!"

Her explanation that she bought the gun for Barton to "kill starlings" is equally ridiculous. She bought the gun specifically for him to use to kill himself. Think what you may of her, but this showed a rare form of motherly devotion.

Her sentencing is set for May 31, 2007. She faces up to ten years in prison on the gun charge. I expect she will get a fully suspended sentence.

Krista Watson & Paul Wright:
Krista married her baby's daddy and had the child, a healthy baby girl. She is working and living in the suburbs of Chicago and keeping a low profile. She is reported to be fully committed to fighting all of the criminal charges against her to the bitter end. This is a risky and unwise strategy. Horton, Mast, Roepke, and now Geraldine are all lined up to testify against her. Furthermore, the U.S. Attorney's Office no doubt has all sorts of smoking guns gleaned from the hundreds of gigabytes of computer data. If Krista's grand gamble fails, her baby's daddy will raise their child alone until she is college age. My prediction is Krista will be found guilty and receive a sentence of around fifteen to twenty years.

Paul Wright has the most plausible deniability of any of the players in this farce. Although Paul had extensive hands-on activity with actions that furthered the fraud, Barton was a master at getting people to do fraudulent acts without letting them know exactly what the purpose of those acts are. Although Paul has some explaining to do (e.g., what the hell did he think the purpose of repeatedly switching serial numbers was, anyhow?!) it is hard to handicap this one. He profited not at all from the scams. He did the dirtiest jobs for very little money. He probably is risking little by going to trial.

The Trials:
Both Krista and Paul have asked that their trials (which are almost certainly going to occur at the same time in a joint proceeding) be delayed for six months due to the complexity of the case. Their request was granted and the trial is currently set for September 10, 2007. I can't wait.

Happy Turkey Day.

2006-11-22T17:51:00.000-05:00

It's been two years since that painful, tortured night. Krista had left Barton, moved out leaving nothing but a pile of empty Hermes boxes behind. Left him behind so that he could do it. Barton's choice of wine for his suicide cocktail was a lovely and expensive California Italian-style red called, Plumpjack. The wine was an inside joke at his own expense, a Shakespearean reference out of the wrong play. Macbeth might have been a better choice. Five bottles were drunk that night, including the now famous La Tache.

Barton loved to cook Thanksgiving dinner himself. It was a holiday that revolved around food and family, both things he craved but never could get enough of. One of his favorite Thanksgiving feasts was to cook and serve Turducken, a boneless turkey stuffed with a boneless chicken, stuffed with a boneless duck. Barton probably ordered one airfreighted on dry ice from here.

Two year on, and still no resolution or closure in the CyberNET debacle. Except for Barton. So fire up the oven, stick a Turducken in and open up a bottle of Plumpjack. If you can't afford the Plumpjack, then a bottle of Fat Bastard Blanc de Blanc will do.

Rest in peace Bart. I wish you were still here so you could help me write this goddamned book... you fat bastard.

Jim

Two More Down...

2006-11-17T16:04:00.000-05:00

Two more of the CyberNET inner circle have joined President Jim Horton by pleading guilty and agreeing to cooperate as government witnesses against the remaining potential CyberNET conspirators.

This morning, Jonathan Mast took time out from selling cars to come into the federal court and plead guilty to Conspiracy to Commit Bank Fraud, Wire Fraud, and Money laundering. The single felony count Barton's long-time VP of Sales pleaded to carries the potential of a mere five years maximum prison term, compared to Horton's pleas to four counts, one of which has a maximum penalty of thirty years. Mast's charge can be seen here. Mast quit CyberNET a few months before it all blew up, after twelve years and two ruined marriages. It appears that it was not soon enough.

Poor Dave Roepke, who was expected to settle for a measly $25,000 of the millions that Horton tried to stash in the days after the CyberNET raid, has also agreed to plead guilty next tuesday to a single count of money laundering. A much more serious charge than mere conspiracy, Roepke faces the possibility of a twenty year maximum sentence. Roepke's charge can be seen here.

With three co-conspirators now convicted and having agreed to testify, the noose is tightening for the remaining targets of the investigation: Krista and Paul "The Butler" Wright. There is even a small chance that the U.S. Attorney's Office might seek to indict Barton's aged, infirm, and emotionally devastated mother Geraldine -- although if they do someone in that office should get their head examined. She has been in a prison of her own making for many years, and since her son Barton's suicide, in her own tormented solitary confinement of the mind. Nothing the federal government can do would punish her more than she must punish herself every day.

As with Horton, Mast and Roepke will be sentenced later. Although they will get brownie points for "accepting responsibility" and pleading guilty, their ultimate sentences will depend as well on the extent of their "cooperation" against the remaining targets. There will be retribution. Justice is more difficult to achieve.

Book Progress

2006-07-04T14:59:00.000-04:00

Most of this year has been taken up plowing through tens of thousands of documents from CyberNET. This treasure trove of primary source documents has been a godsend and a curse since I have felt the obligation to leave no stone unturned.

The writing is coming quite well. I have as of right now 133,228 words, which translates to 419 manuscript pages. I have been writing chronologically, and am now writing about 2001. I expect the first draft will be around 550 pages, but will be cut perhaps 20% in the editing process.

I appreciate the interest and patience of all who are interested in the final result of my work. I promise you that it will be well worth the wait.

The above photo was taken of Barton and Krista on February 28, 2003 in Istanbul, Turkey, and shows the Straights of Bosporus behind them.

Jim Cameron

The End of the Line

2006-06-23T10:46:00.000-04:00

Yesterday, on June 22, 2006, James M. Horton, former president of CyberNET and as Brad Edwards of WOOD-TV put it "Barton Watson's chief button pusher" pleaded guilty in U.S. District Court to criminal conspiracy, bank fraud, and two counts of money laundering. A couple things are noteworthy about this. First and foremost, Horton has now formally committed to cooperating with the federal prosecutors. This means he will be the star witness against the other alleged co-conspirators who include trophy wife Krista and Paul Wright the butler. The second noteworthy aspect is that the plea was in front of Chief Judge Robert Holmes Bell, instead of the magistrate judge who was originally supposed to take the plea. This means that Judge Bell may have wanted the case himself, and that he will be the one to sentence Horton. If it's true that Judge Bell wanted the case for himself, it is doubtful that he wanted it in order to be lenient at sentencing. Horton may well find that despite his cooperation, Judge Bell tees off on him at sentencing much like old Judge Gesell did on Barton Watson back in 1987.

The puzzling thing about the way the case has developed is that Horton -- arguably the most criminally culpable -- has emerged as the principal state's witness. I sense that the prosecution is going down the food chain instead of up.

Barefoot and Pregnant

2006-05-13T18:21:00.000-04:00

Words escape me regarding the latest bombshell about Krista Kotlarz-Watson.

The background is this:

Krista had a court appearance scheduled in the Bankruptcy Court in Grand Rapids. She has no lawyer representing her in the Bankruptcy. She didn't want to have to attend, as she is living in Schaumburg, Illinois. Since she had no lawyer, she wrote the judge herself asking to be excused from appearing. One would imagine that she never realized the contents of the letter would quickly be picked up and plastered across the pages of the Grand Rapids Press.

Her entire letter can be accessed here: Krista's Letter to the Judge

Horton Hears a Who?

2006-04-17T20:58:00.000-04:00

Today Jim Horton, former President of CyberNET and Barton Watson's right hand man, waived his right to have his case presented to a grand jury and agreed to be charged without having to be indicted. This process -- called being charged "by information" -- is almost always used when a plea agreement has been reached, or at least when the defendant's strategy is to eventually plead guilty, either with or without a plea agreement. Today, however, Horton pleaded not guilty.

Horton had been cooperating with the federal prosecutors to some extent through the last year. The fact that Horton pleaded not guilty to the information suggests that some problem with his cooperation has developed. By agreeing to let the prosecutors skip grand jury leaves the door open for a plea deal where Horton would agree to testify against the other as yet unidicted co-conspirators.

One possible problem could be that after spilling his guts, Horton didn't like the deal he was offered. How sweet a deal can the prosecutors give to a guy who was primarily responsible for stealing almost 100 million dollars? Certainly he was acting on Barton Watson's orders, but the Nuremburg Defense doesn't fly in this case.

The fact of the matter was that for the last two years of CyberNET's operation, Horton spent virtually all his time in a panic, scurrying around getting loan and lease deals as quick as he could set them up. He was Barton's private full-time financier, solely responsible for keeping the millions of dollars of borrowed money flowing to fund CyberNET's US operations and Barton's schemes in Asia. The burn rate was between two and four million dollars a month between 2003 and 2004.

On the other hand, by 2002 Barton's wife Krista had retreated to her new horse farm and was spending very little time with the business. Her involvement in the fraud was mostly signing where Barton told her to and spending the money. She occasionally presided over "Executive Committee" meetings, but as a business woman she had become a dilettante. (In years prior to the start of the massive frauds she really did have significant involvement in the operation of the legitimate side of the business.)

Barton on the other hand was off on constant trips to Asia. He had almost completely ignored the legitimate side of CyberNET's operations since 2002, and was spending all his time and energy on trying to buy companies in the Far East for cheap. Bored with running an unsuccessful IT company, Barton's new hobby was shopping for companies. It was a costly one that required even more massive infusions of cash.

The result of this kindergarten fire-drill management style was that no one was at the wheel of the CyberNET bus. Despite massive expenditures on a top-notch marketing and HR department, and a pretty decent new sales operation, CyberNET's traditional IT business was hopelessly unprofitable.

Barton killed himself. The moral judgment with regard to him is easy (although maybe too easy). But what to do with the remaining players? Horton actually did the nuts and bolts of the fraud, but profited very little. Krista's head was in the clouds, had little personal involvement in the fraud, but profited greatly. Who is more criminally culpable?

The Bag Lady

2006-04-15T17:04:00.000-04:00

This photograph of Krista Watson was taken in late spring 2004 in a conference room at the AyalaPort call center near Manila, in the Philippines. Barton had swung a deal to buy the call center in a stock swap. Although this was not Barton's first overseas business acquisition, it was his most ambitious. Krista took the trip with Barton to tour the facility, and as owner of CyberNet Engineering, to meet the Phillipino partners. Krista is surrounded by thousands of dollars worth of Gucci handbags that she had brought with her. The composition is odd and haunting. Obviously not posed, she is alone with nothing but her expensive Italian leather and a inscrutable look on her face.

Soon Krista will almost certainly be indicted by a federal grand jury for the Western District of Michigan. She will appear in the federal court in Grand Rapids for her arraignment and sit in front of the judge with the same look on her face. The Gucci handbags will be gone.

Aloha and Happy New Year!

2006-02-02T18:57:00.000-05:00

Barton and Krista had a great deal of stress in their lives. When Barton wanted to unwind, one his favorite places to do it was Hawaii. Barton loved the islands ever since his many stopovers during his trips to the Marianas Islands in the early 1980's when he was trying to land investment business with the corrupt local government officials. One trip to Hawaii led to the break-up of his first engagement when his fiance' found evidence of his having taken a trip there with another woman.

Barton and Krista visited Hawaii for a vacation over New Years, 2003. Despite the intense financial stresses of this period, Barton always looked relaxed when traveling with Krista.

Barton's Favorite Fabulous Things, Part 4

2005-12-30T09:07:00.000-05:00

Bijan

Nowadays better known for his perfume, Bijan still has menswear boutiques in Beverly Hills and on Fifth Avenue, specializing in flamboyant but tasteful styles for an elite clientle. Barton shopped at the famous designer's then-new Fifth Avenue boutique in the mid-1980’s during a trip with one of his girlfriends. She decided to break up with him when he lied to her about how much he had paid for two suits he bought there that were on sale (she peeked at the pricetags). Barton was waited on by Bijan himself.

http://www.bijan.com/

Bart's Letter to Santa

2005-12-25T11:33:00.000-05:00

McIntosh Labs / Dictaphone

Young Bart's two favorite childhood Christmas gifts were his McIntosh Stereo system, received in 1971 when he was 11, and a fully functioning office quality Dictaphone, given to him in 1972 when he was 12.

The McIntosh was at the time the finest piece of audio equipment made anywhere in the world. A gift from his Grandfather, it included preamplifier, power amplifier, turntable, speakers and an AM/FM tuner. The total cost equaled that of a brand new Chevy Camero at the time. Barton loved the system and played music on it endlessly. His favorite piece to play when I came over was the 1812 Overture. The McIntosh would shake the house during the cannon part. Barton cherished the system his entire life, with parts of it in his office at 25 S. Division, and other parts in his den at the house in Ada. These remaining components from the system went for very high prices at the two bankruptcy auctions that followed the collapse of CyberNET and Barton's life.

Bart loved his Dictaphone, and would play with it often as a young teen, recording pretend messages to pretend employees. Despite the fact that Dictaphone's market share has fallen to a small fraction of the market it once dominated, Barton remained loyal to their products. He dictated his suicide note on a Dictaphone the night he killed himself.

http://www.mcintoshlabs.com/

http://www.dictaphone.com/

The Christmas that Wasn't

2005-12-24T09:39:00.000-05:00

Cygnus

Christmas 2004 was a sad, tragic time for many involved with CyberNET. Barton ended his life after a tortured night of self examination. Barton's family dealt with the loss and grief of his suicide. The CyberNET "mahogany Row" cabal sweated the fact of an ongoing criminal investigation. CyberNET's employees were summarily fired; jobless just in time for the holidays.
But what if the raid hadn't happened? One thing that would have been different is that the lavish CyberNET Christmas party would have taken place. Barton had never skimped on Christmas parties for his employees. It was the perfect opportunity for him to hold court and be the center of attention. He planned these events carefully and enjoyed them them greatly even if all of his employees did not. For the Christmas 2004 party he had rented out the restaurant Cygnus located at the top of the Amway Grand Hotel. The invitations had gone out, the menu and wine list had been planned. It never happened.

I had the pleasure of eating there last weekend. The restaurant was dramatically lit and beautifully decorated for Christmas. The view at night was spectacular, although the absence of other tall buildings and the low, grid-like street layout lacked the makings of a world-class view as one would have in Chicago or New York. The quality of the meal did not match the setting. Far better food is to be found at the 1913 Room at the Amway Grand Hotel, the setting of Barton's theatrical proposal to Krista 14 years earlier.

http://www.amwaygrand.com/cygnus.html

Barton’s Favorite Fabulous Things, Part 3

2005-12-23T23:18:00.000-05:00

Bentley

As a young teenager Barton developed an interest in classic Bentley racing cars from the 1930’s after reading a book his brother Karl gave him. He later gave the book to me and I still have it. Years later, at the height of the CyberNET scam, he would lease several Bentleys in a row. The last one, seized just before his suicide, was a tan-colored Arnage chosen by Barton because it was identical to one driven by another resident of Ada, Michigan, Jay VanAndel, the founder of Amway.

http://www.bentleymotors.com/

Barton's Favorite Fabulous Things, Part 2

2005-12-22T16:06:00.000-05:00

Cable Car Clothiers

When he was a young teen Barton took a trip to San Francisco with his mother Geraldine while she was trying to develop an unsuccessful business idea. While there Barton visited this legendary San Francisco men’s store. He brought home a catalog and gloated about having shopped there. As the years went by Barton must have found the shop's styles too preppy. As an adult he favored a flashier, more ostentatious manner of dress.

http://www.cablecarclothiers.com/