Xenu-City.Net - One City. One Cult.OCCUPIED CLEARWATER
CURIOUS GEORGE CHELEKIS
"George Chelekis was making money and making headlines in downtown Clearwater. He was the successful businessman who employed 100 workers and claimed his company pulled in $1-million a month. He was the brash publisher who embarrassed government bureaucrats, showing how they sometimes gave away surplus property at ridiculous, fire-sale prices. But now the one-time president of Rex Publishing Co. has taken on a new persona: The missing person. At least six companies are chasing Chelekis or Rex Publishing and demanding a total of more than half a million dollars. In Hillsborough County, a judge ordered him to spend five days in jail for contempt of court. They haven't found him. Chelekis, the seemingly successful businessman and the brash publisher, appears to be in hiding."

Ex-publisher sought by creditors
St. Petersburg Times, Jul. 8, 1991
Curious George Chelekis (Photo by Steve Hasel, St. Petersburg Times)

Have you seen this man?

Photo by Steve Hasel
St. Petersburg Times
CONTENTS

Cast of Characters
The good, the bad, and the missing.

Hot Stocks Review
Chelekis gets nailed by the SEC for false claims in his Hot Stocks Review, and loses the one of the largests libel cases in Canadian history.

Rex Publishing
Chelekis is investigated for credit card fraud and false advertising claims, and is ordered to jail by a Hillsborough County judge.

Loose Ends
Curious George, whither goest thou?

More Links
Adrian du Plessis' "corporate carnival", books and essays by Chelekis, and How To Report Fraud to state and federal agencies.

Now you see him, now you don't...

Twice now, George Chelekis has made a lot of noise with ventures based in or near Clearwater, only to fall silent and drop out of sight when finally busted by regulatory or law enforcement agencies. Once a Scientology publicist in New York, Chelekis has become internationally infamous for his business escapades and subsequent disappearing acts.

The first fiasco was Rex Publishing, which was in the business of hawking Chelekis's Action Guide to Government Auctions and Real Estate, and was reportedly pulling in $1 million each month. Consumer complaints about refunds and unauthorized credit card usage sparked investigations by the Clearwater Police Department and the Florida Attorney General's Office. The state Department of Revenue hit the company with warrants for failure to pay sales taxes, and Rex's creditors were filing and winning lawsuits. But by 1991 Chelekis had vanished, and couldn't be located by authorities or process servers, even after a Hillsborough County judge ordered him to jail for contempt of court.

Chelekis surfaced in 1993, this time as a financial "journalist", writing for The Bull & Bear, and later for his Hot Stocks Review tip sheet. In 1994, for reasons which are still unclear, he picked a nasty fight with Vancouver Sun journalist David Baines and financial investigator Adrian du Plessis, accusing them of a short-selling conspiracy. Ironically, though, it was Chelekis who was nailed by regulators in 1997 when the SEC accused him of publishing false and misleading statements, and failing to fully disclose the money that he was receiving from the companies that he was writing about. He also lost the lawsuit filed by Baines, who was awarded one of the largest libel judgments in Canadian history. Chelekis's failure to appear in British Columbia Supreme Court couldn't have helped his case, but his second disappearance has helped him avoid collection efforts so far.

Chelekis's current whereabouts are generally unknown, as is his status, if any, in the Church of Scientology. Once a "Patron with Honors" of the International Association of Scientologists ($100,000+ donation), his name does not appear on the Flag Commendations directive, although two other Chelekis's do.

So where is Curious George now? As Jeff Nash wrote in Equities magazine:

"He may be coming to a town near you soon. Protect your mother."
CAST OF CHARACTERS
  • George Chelekis - Former New York-based publicist for the Church of Scientology; self-proclaimed "money wizard" of Hot Stocks Review and such titles as The Action Guide to Government Auctions and Real Estate and The Magic of Credit; achieved at least Patron with Honors status in the International Association of Scientologists; whereabouts unknown.
  • Maaret Schnier - Chelekis's partner in Rex Publishing; status in Scientology, if any, is unknown, but the agreement between Schnier and Chelekis includes a clause regarding WISE arbitration.
  • Robert Shore - Owner of Market News Publishing, Inc., and a defendant in the Baines/Southam libel suit.
  • David Robinson - Publisher of the Bull & Bear tout sheet, which carried Chelekis's libelous articles; also a defendant in the Baines/Southam libel suit.
HOT STOCKS REVIEW
THE SECURITIES FRAUD CHARGES
  • Financially Plugged In
    St. Peterburg Times, July 31, 1995
    "His background is as a freelance fashion writer and celebrity interviewer, not as an investment expert. However, last year Chelekis began writing about mining companies and other speculative Canadian stocks, specializing in those traded on the Vancouver Stock Exchange. He is now widely quoted in the Canadian press and on financial news services. In fact, his following has grown so large that a thumbs-down can be enough to send a stock into a tailspin, occasionally even generating death threats from shareholders... Chelekis says he does nothing wrong and that Canadian journalists are jealous because he scoops them on big stories. One of those journalists, a reporter for the Vancouver Sun, is suing him for libel. So far, however, no government agency has made any move to censure Chelekis."
  • Internet financial columnist has "hot" advice
    Tampa Tribune, July 22, 1995
    "Chelekis is the child of a Greek family from New York City and he was trained in journalism reading the city's tabloids. He is plenty loud, he admits. Few things quiet him. One is an association with the Church of Scientology in Clearwater. He once admitted to being an adherent, and is listed as a $100,000-plus donor in Impact Magazine, the magazine of the International Association of Scientologists."
  • Beginning Investors Beware
    Equities Magazine, Feb. 1997
    "After getting slapped by the SEC, stock promoter George Chelekis, editor of Hot Stocks Review, visited New York City with his latest ploy-a penny stock 'workshop' attracting many ignorant investors, including elderly retired widows. He may be coming to a town near you soon. Protect your mother."
  • SEC v. George Chelekis, KGC Inc., Hot Stocks Review, Inc.
    SEC press release, Feb. 25, 1997
    "The complaint alleges that from at least January 1995 through August 1995, Chelekis, a publisher who distributes various investment newsletters, known as the 'Hot Stocks' publications, over the Internet and in print format, knowingly or recklessly made materially false and misleading statements concerning six publicly-traded companies. The complaint further alleges that from April 1994 through September 1995, Chelekis failed to disclose in the Hot Stocks publications that he and entities that he controls, defendants KGC, Inc. and Hot Stocks Review, Inc., received at least $1.1 million from more than 150 issuers, and 275,500 shares of stock from 10 issuers, as payment for recommending securities of such issuers in the Hot Stocks publications."
  • Enforcement Activities - Internet Cases
    SEC 1997 Annual Report
    The Commission filed a complaint against George Chelekis and two companies that he controlled,     KGC, Inc., and Hot Stocks Review, Inc. (SEC v. George Chelekis, et al.3). Chelekis published and distributed internet and print versions of investment newsletters known as the Hot Stocks publications. Chelekis failed to disclose that he and the other defendants received at least $1.1 million from more than 150 issuers, and 275,500 shares of stock from ten issuers, as payment for recommending those issuers' securities. The defendants consented to the entry of an injunction and orders requiring them to pay a total of $162,727, representing $75,050 in disgorgement, $12,627 in prejudgment interest, and a $75,050 civil penalty.
  • Internet newsletter author settles SEC charges
    St. Petersburg Times, Feb. 26, 1997
    "The author of several popular intemet newsletters on investing settled federal charges Tuesday that he had misled investors by making false claims about several companies and failing to disclose that he was getting paid to promote more than 150 stocks. George Chelekis, who publishes the Hot Stocks newsletters in Tampa, agreed to pay $163,000 to settle a civil case brought by the Securities and Exchange Commission in U.S. District Court in Washington. Without admitting or denying the commission's charges, Chelekis agreed to a permanent injunction barring him from violating securities laws."
  • Internet stock newsletter settles SEC charges
    National Fraud Information Center, Feb. 27, 1997
    "George Chelekis, owner and operator of     KGC, Inc., and Hot Stocks Review, Inc., has settled charges by the Securities and Exchange Commission that he and his companies distributed over the Internet and in print format 'materially false and misleading statements concerning six publicly-traded companies.' ... The SEC complaint alleged that Chelekis failed to disclose in his Hot Stock publications that he and his companies had received $1.1 million from more than 100 issuers and 275,500 shares of stock from 10 issuers as payment for recommending the stock of those issuers."
Red Face at Hot Stocks Review

By Robert J. Flaherty
Equities Magazine, Feb. 1997

Wannabe financial journalist, Hot Stocks Review editor George Chelekis, has been on a bitter personal campaign criticizing conventional financial journalists. For example, his headline in the most recent The Bull and Bear Financial Report rages against "False, reckless and misleading media reports about the price of gold." (Many of his companies are tiny gold companies.)

However, in late February the SEC made some shocking accusations of its own against this highly visible stock promoter, who has tried to protect himself by adopting the guise of a crusading journalist. To settle a civil suit brought by the SEC, Chelekis, without admitting or denying the harsh SEC charges, agreed to a permanent injunction banning him from violating security laws and agreed to a disgorgement payment of $163,000. The SEC notes this is the first case where a stock promoter disgorged not only company payments he received for promoting stocks, but also money he received from his newsletter subscribers under false pretenses.

In 1995 the SEC stated that Chelekis took over $1.1 million from over 150 companies and received 275,000 shares of 10 stocks in return for recommending them.

Not So Hot

Apart from inadequate or misleading disclosure, the heart of the SEC's suit was that Chelekis in six separate cases made false statements about the companies he was hyping, such as they were about to get big contracts, had hot new products or were about to be taken over. After soaring, many of these shaky stocks subsequently collapsed, hurting many of the little people whom Chelekis had persuaded to buy them. Instead of protecting the public, the SEC charged Chelekis with preying on it.

Chelekis' particular forte has been aggressive promotion of tiny, highly speculative and profitless Canadian companies, often traded on the scandal-ridden Vancouver and Alberta Stock Exchanges, plus the Canadian Over-The-Counter Dealer Market and the NASD OTC Bulletin Board. The six companies in the SEC's complaint were Advanced Viral Research, earlier promoted as a "miracle AIDS cure" by Equities favorite financial pornographer, the late, great ex-con newsletter writer John Holmes in his FREE Profit Strategy (See Equities May 1987, page 6 and August 1987, page 5), Canmine Resources, Luminart, whose own earnings estimates have never once been met (See Equities July 1995, page 28), Nona Morelli's II, where the CEO once spent a night in jail (See Equities January 1996, page 36) and Quest Resources (See "Can Paradise Be Regained?" Equities July 1996, page 23) and Urban Resource Technologies.

So wild was Chelekis' hyping that the SEC states four of these companies where he had been paid to promote their shares turned out press releases denying his claims. Chelekis also championed automobile emission purifier EPA Enterprises, where one of the directors resigned when caught forwarding to English investors a false letter of product accreditation from the California Air Resources Board. (See Equities August 1995, Page 64). Chelekis also hyped his favorite gold stock, thinly traded Gallery Resources (Alberta Stock Exchange: GYR.A-C$0.57). In December 1995, he predicted it would rise 600% from C$0.90 to $5 in 1996. Naturally, this false prophesy created a situation where insiders could unload shares, which had been as low as $C0.09 in 1995 and soared in 1996 to $C1.99, on the unsuspecting public.

Apart from Internet distribution of his not so Hot Stocks Review and Hot Stocks Whispers, the Tampa, Fla-based Chelekis, a sometime Scientologist, is a major print contributor to David Robinson's widely distributed tip sheet, The Bull and Bear Financial Report. In the recent 48-page edition Chelekis alone accounted for 7 full pages, 14% of the entire content. On one page he offered a "free workshop" over February 24 to March 3 to these largely unsophisticated, often retired, elderly readers on "How to Invest in Canadian Stocks" in 11 Florida towns—"live presentation in YOUR hometown." He trumpeted that you can "Meet George Chelekis' 7 Best Bet Companies." There is no disclosure on the page stating whether any of these companies has or has not paid Chelekis a dime. The paper also carries big headlines Hot Stocks Review is free to all Bull and Bear subscribers. As the SEC charges suggest, getting & "free" advice from Chelekis can be expensive. Especially so when it includes "HOW to Buy and WHEN to Sell" and "HOW to STOP being tricked or fooled."

Individual investors in Manhattan also were being bombarded in their mail in envelopes from The Bull and Bear Financial Report announcing on March 7 a New York City free workshop presented by Hot Stocks Review, entitled "How to Beat the Penny Stock Market. Reserve your VIP seat now or risk waiting in line for hours to get in! Your Stockbroker Will Probably Be There—Don't Miss Out!" Chelekis was featured as a New York City radio talk show host, because of his weekly activities on WEVD, and also as an Internet guru.

Bull and Bear publisher David Robinson sent a pitch letter to his complimentary subscribers list in the New York area trumpeting nine big Chelekis penny winners (which ironically included now collapsed Bre-X). Robinson failed to disclose even one of his many disasters, like Gallery Resources; which hurt the little people, and Equities doesn't mean Leprechauns! We mean the likes of old retired ladies. (See page 27 of Feb 1997 Equities)...

Unquestionably, George Chelekis is an energetic, exciting writer but the activities uncovered by the SEC indicate he does not know the difference between being a financial journalist and a stock promoter. Some of his past associations are with unsavory elements. Just one example, subsequently convicted felon Sonny Block (rhymes with shlock) wrote the introduction for a Chelekis book. As The New York Times late reporter Sidney Fish pointed out in Equities 45th Anniversary issue article on the evolution of financial journalism since the 1929 crash, the journalist in his own stock trading, if any exists, must put his readers before himself, just as an honest, prudent investment advisor should put his clients or fund shareholders before his own personal transactions. People like Chelekis who do otherwise can call themselves journalists but there are better names for them.
Live By The Sword, Die By the Sword

by David Baines
B.C. Business, Feb. 1997

Vancouver Sun stock market reporter David Baines was impaled by the pen of penny stock tipster George Chelekis. He recounts how he turned it around and stuck Chelekis for the largest libel award in B.C. history.

In the early morning hours of April 15, my wife and I returned to our New York hotel room just off Times Square, slightly boozy from imbibing the bar music in Greenwich Village. The red light on the telephone was pulsing with an influx of calls from family members, neighbors and reporters with some long-awaited news. B.C. Supreme Court Judge John Rowan had assessed $875,000 in damages, plus legal costs, against three parties who had orchestrated or facilitated a campaign to destroy my reputation as a journalist. It was the culmination of a four-year battle to redress one of the most egregious libels ever committed in Canada.

Rowan's award was the second-highest in Canadian libel history, exceeded only by the $1.6 million awarded an Ontario Crown prosecutor libeled by the Church of Scientology. In British Columnia, it was more than six times the previous record of $125,000 awarded to deputy attorney general Richard Vogel against CBC reporter Chris Bird.

In his judgement, Rowan rejected allegations I had used my position as a stock market reporter and columnist with The Vancouver Sun to manufacture negative stories against Vancouver Stock Exchange companies and profit on the ensuing sell-off. He also dismissed allegations I was involved in a homosexual relationship with my alleged co-conspirator, free-lance stock market investigator Adrian du Plessis, and that I had contracted AIDS but had failed to tell my wife.

(The relevance of these alleged sins to my purported stock market transgressions was never explained.)...

In late July, 1994, I received a call from a George Chelekis, a writer for The Bull & Bear financial newspaper, a U.S. publication I mistakenly viewed as a Barron's-type periodical. Chelekis said he was doing a story on the VSE and began asking me questions that gradually moved from the Exchange to me personally. I became increasingly uncomfortable and soon cut him off. A day or two later, du Plessis - whose nose for subterfuge was in high alert - called to warn there was a fellow from Florida who was purportedly writing about the Exchange, but whose real motives were unknown.

On July 29 I called Chelekis's office and advised his secretary I did not want to be mentioned in his story. In a follow-up fax, I stated: "I have received information that you are not a mainstream journalist, as you represented yourself. I therefore direct you not to use my name or any quotes from me in your publication."

Chelekis immediately wrote The Sun publisher Don Babick, advising him I had threatened to kill his secretary and was now trying to kill his story. He also wrote senior editors at The Financial Post, The Globe and Mail and The Toronto Star declaring: "Apparently a nerve was touched when my investigation turned up vested interests connected with Baines and du Plessis - neither want this information published as it may severely impact their careers."

Chelekis portrayed himself as a respectable journalist. His letterhead proclaimed him a member of the American Society of Journalists and Authors. He also said he was a "best-selling author" and winner of something called a Gold Charlie Award.

However, one look at a copy of The Bull & Bear confirmed my worst suspicions: It was a Florida-based rag that touted penny stocks and blatantly invited public companies to "Tell your story to millions of investors" by having "an award-winning author write your company's story the way you want it to be told." When I later asked Chelekis whether he was the award-winning author, he replied, "No one pays me to write articles the way they want them written. I write what I want."

It was specious phraseology. Subsequent events would show that Chelekis indeed wrote what he wanted. What he wanted to write most of all were nice things about companies that paid him money...
HOT STOCKS REVIEW
THE LIBEL SUIT
  • A Litmus Test
    Adrian du Plessis, Silicon Investor, Sep. 15, 1997
    "As is clear from the earlier post, two VSE 'liars for hire', Bob Shore and George Chelekis conspired in a failed attempt to discredit the business journalist David Baines and myself. Baines has never shorted a stock in his career but has raised the ire of many crooks because he has exposed them publicly to benefit public investors. The attacks on myself (and similarly, I do not short stocks, nor do I go long, I don't trade period) had additional motivation. As came up at trial last week, at the time that George Chelekis, a Scientologist who's at least OT4 (for those who care about such things), was hired for the smear job I was working as an expert consultant to Time Warner Inc. They had published a cover story titled 'Scientology: The Cult of Greed' (TIME Magazine, May 6 1991) and retained me to help defend an action taken by Scientology forces against them. Anyone familiar with the Church of Scientology will know they are infamous for vicious attacks on people that they view as being their enemies. In my case I hold no personal views on Scientology but the fact I was assisting Time was apparently enough to make me such an enemy in the eyes of some. The major damage awards made in cases to compensate victims of Scientology attacks and various court decisions in such matters are testament to these tactics. Any web search engine should help one easily find the details of landmark cases in this area (e.g. look at the recent Casey Hill case). So, when you combine your garden variety penny stock sleazeballs with elements of Scientology campaigns the result is predictably bizarre and malicious."
  • Apology to David Baines and Southam
    Market News Publishing Inc.
    "On September 29, 1994, Market News Publishing Inc. disseminated an article that made allegations that Vancouver Sun business writer David Baines was trading against his column. This article was written by George Chelekis, a stock tipster from Clearwater, Florida. The allegations against Mr. Baines were completely false.We sincerely apologize to Mr. Baines and The Vancouver Sun for disseminating this material and for any inconvenience or embarrassment this may have caused."
  • Southam traps Shore with his own libel
    Stockwatch Business Reporter, Sep. 12, 1997
    "Neither Mr Chelekis nor David Robinson, publisher of the Florida-based tout sheet Bull & Bear, are represented in court, though both attempted unsuccessfully to derail their trial. Mr du Plessis is pursuing a separate legal action over the libelous allegations that he conspired with Mr. Baines and unnamed short sellers to profit from driving down the price of a number of VSE companies over a six-year period. In addition, Mr Chelekis told about 150 people at a May 1996 investment conference in Vancouver that Mr Baines was HIV positive and had not told his wife."
  • Reasons for Judgment
    Baines and Southam, Inc. v. Chelekis, Apr. 15, 1998
    "Chelekis participated in this action but did not appear at the trial. Lawyers who had acted for Chelekis throughout the action withdrew a month or so before the trial because they could not contact him. On the day of the trial new counsel appeared for Chelekis and sought an adjournment of the trial. An adjournment was declined and the trial proceeded without him or the Defendant Robinson."
  • Sun business writer wins $875,000
    Vancouver Sun, Apr. 16, 1998
    "In the course of his campaign, Chelekis manufactured three separate and deliberate lies, the first, that David Baines threatened his life; the second, that Baines was trading against his column, and third, that Baines was involved in a homosexual relationship with Adrian du Plessis," Rowan wrote in his judgment. Rowan termed Chelekis' conduct as arrogant, vindictive and continuous during the two-year campaign against Baines.
  • Notice for Publication
    Adrian du Plessis, alt.invest.penny-stocks, Jan. 24, 1998
    "TO: THE DEFENDANT, GEORGE CHELEKIS TAKE NOTICE THAT on September 25, 1997 an Order was made for substituted service upon you of a writ of summons issued from the Vancouver Registry, Supreme Court of British Columbia, in Action No. C965502 by way of this advertisement. In the proceeding a claim is made against you by the Plaintiff Adrian du Plessis for damages for defamation arising out of the publication of two articles in The Bull & Bear, dated August, 1994 and October 1994. You have 28 days to enter an appearance in the Vancouver Registry of the Supreme Court of British Columbia, failing which proceedings in default maybe taken against you."
  • Wawanesa client in VSE "liars for hire" conspiracy: George Chelekis, Bob Shore exposed
    Adrian du Plessis, misc.invest.stocks, Sep. 13, 1997
    "A last minute apology by Howe Street news disseminator Bob Shore's Market News proved too little too late to stop him from being exposed in B.C. Supreme Court this week.  The trial of "liars for hire" in the VSE community wrapped up this week.  Shore, represented by a lawyer for Wawanesa Life Insurance Co. and George Chelekis, represented by an ever-shifting parade of lawyers, have been fingered as the point-men for a cabal of interests that sought to discredit reporter David Baines and investigator Adrian du Plessis by spreading malicious lies about the pair. Links to prominent VSE brokers, promoters, securities lawyers, the Church of Scientology and other interests have been raised in the course of the legal pursuit of the Shore/Chelekis team."
  • Mining Money in Vancouver
    TIME, May 6, 1991
    "One source of funds for the Los Angeles-based church is the notorious, self-regulated stock exchange in Vancouver, British Columbia, often called the scam capital of the world. The exchange's 2,300 penny-stock listings account for $4 billion in annual trading. Local journalists and insiders claim the vast majority range from total washouts to outright frauds."
REX PUBLISHING
  • Scientology: A Long Trail of Controversy
    Los Angeles Times, Aug. 27, 1978
    "George Chelekis, a Scientology publicist in New York, said the church is also spending another $125,000 this year to promote a 'revised version' of Hubbard's 1958 book, 'Have You Lived Before This Life?' "
  • Book is bid business
    St. Petersburg Times, May 24, 1989
    "Chelekis agrees that getting something for practically nothing is rare, but he said that substantial bargains - between 30 and 70 percent below the appraised value - can regularly be had. Sometimes government officials are reticent to admit that such things happen, he said. 'Catching them in their own lies is rather fun sometimes,' he said."...
  • Winner is leading in contributions
    St. Petersburg Times, Mar. 10, 1990
    "Winner said at the time he accepted the ads he did not know anyone at Rex Publishing might be a Scientologist. But he said he would have frowned on a contribution from any organization formally affiliated with the Church of Scientology. Chelekis said in a prepared statement, 'There is no formal connection between Rex Publishing Co. and any church. There never was and never will be.' "
  • Advertisements for books misleading, say marshals
    St. Petersburg Times, Apr. 17, 1990
    "U.S. Marshals claim Rex Publishing Co. in Clearwater is using misleading advertising to sell its books about government auctions... The Marshals Service has asked the Federal Trade Commission to investigate whether the magazine and radio ads violate federal rules requiring truth in advertising."
  • Agreement
    George Chelekis & Maaret Schnier, May 1, 1990
    "In the event of any controversy or claim arising out of or relating to this Agreement, or breach of any of its provisions, the parties hereby agree that the dispute shall be decided as a business dispute in adherence with, and by WISE arbitrators trained in Scientology ethics and justice policy letters with respect to all ethics relevant to such controversy and claim; and the parties agree to be bound by such decision."
  • Letter to Steven L. Hayes
    Assistant Attorney General, Sep. 7, 1990
    "Thank you for the extensive materials you and your client have provided us. We would appreciate your furnishing us documentary justification for a number of claims made in those materials."
  • Ex-publisher sought by creditors
    St. Petersburg Times, Jul. 8, 1991
    "George Chelekis was making money and making headlines in downtown Clearwater... But now the one-time president of Rex Publishing Co. has taken on a new persona: The missing person. At least six companies are chasing Chelekis or Rex Publishing and demanding a total of more than half a million dollars. In Hillsborough County, a judge ordered him to spend five days in jail for contempt of court. They haven't found him. Chelekis, the seemingly successful businessman and the brash publisher, appears to be in hiding."
  • Memo: Rex Publishing
    Financial Investigator, Attorney General's Office, Feb. 10, 1992
    "They were attempting to track down Chelekis for factoring and fraudulent use of credit card authorization... The July '91 St. Pete Times article, which is now missing from the file, reported that the Church of Scientology was probably involved in Chelekis' disappearance, which left behind huge financial debts."
  • Memo: Rex Publishing
    Financial Investigator, Attorney General's Office, Sep. 29, 1992
    "Rex Publishing principal/CEO George Chelekis vanished in 1991, walking away from his collapsed telemarketing scheme... Criminal authorities probing Rex are stonewalled by the 100 or so former Rex employees - all Scientologists - unwillingness to roll over. Apparently all business records were successfully shredded, indicating the collapse was engineered."
  • Memo: Case Background
    Financial Investigator, Attorney General's Office, Oct. 1, 1992
    "In March 1991 NABANCO, the Dept. of Revenue, and a few other creditors sued Rex, but found it shut down and Chelekis gone to earth. The Clearwater PD would like to make a criminal fraud case, but they need to link specific victims of phony charges with specific slammers, a daunting challenge made tougher by the Scientologist-employees refusal to assist."

MEMORANDUM

TO: file

FROM: Jim Lyons, Financial Investigator

DATE: Oct. 1, 1992

RE: Case Background

George Chelekis wrote a book called "Action Guide to Government Auctions" and began marketing it nationwide with cheap radio and TV spots. The basic book came with three years of access to a help hotline and some bimonthly updates for $114. There were several upgrade packages which included more books, pamphlets, and "consulting". The ads inferred immense profits and cited four specific deals done by customers using the AGGA system.

Our case began in June 1990 with a request for assistance from the Passaic County OCA, citing these claims. Mike Stuckey quickly found 20 consumer complaints, on file with DCS - there may be more with Pinellas OCA - mostly for failure to refund dissatisfied customers. These 20 were forwarded to us but not in the litigation file. Stuckey then subpoenaed Rex for substantiation of the claims. They sent a carton of materials, which we waded through and discovered was a smokescreen; the substantiation was not there. Stuckey wrote back in Sept. 1990 with further questions. That's where the file ends. Stuckey left the Department six months later.

During 1989-1990, Rex became very successful. The ads generating calls into a boilerroom which did credit card sales of the AGGA. At one point he had 100 slammers. The commission/override structure for paying them was allegedly conducive to fraud; slammers logging sales and putting through unapproved credit card charges. Chelekis the Scientologist hired mostly Scientologists and did business mostly within the Scientologist business community, with the major exception of his merchant account. That was issued by NABANCO, who shut off the account when the chargeback rate got too high, but still got stuck with $341,600 worth of chargebacks; either fraudulent charges or chargebacks already issued to dissatisfied customers. In March 1991 NABANCO, the Dept. of Revenue, and a few other creditors sued Rex, but found it shut down and Chelekis gone to earth.

The Clearwater PD would like to make a criminal fraud case, but they need to link specific victims of phony charges with specific slammers, a daunting challenge made tougher by the Scientologist- employees refusal to assist.

I've heard that Chelekis has returned to Clearwater and recently reopened another business selling AGGA again, and am working to confirm that. I'll check court records and see who perfected service and what the status of those cases are.
LOOSE ENDS
  • Where is Chelekis now?
    As recently as Feb., 1998, two other Chelekis's appear to have been Scientologists in good standing - is Curious George still hanging out at Flag? A number of websites still advertise his books, but Amazon.Com indicates that at least one of them may be out of print.
  • What sparked Curious George's libellous attack on Baines and du Plessis, and who financed it?
    Chelekis began his war on the financial investigators three years after TIME magazine wrote about the Vancouver Stock Exchange being a source of funds for the cult; du Plessis had been retained by Time-Warner to defend against the libel suit over that article. Did Scientology officials order the Chelekis attack in order to "handle" du Plessis? Did public Scientologists with significant interests in the VSE have a hand in it? Who paid Chelekis's expenses, including the private investigators?

How to report fraud to the:

MORE LINKS
  • The Corporate Carnival Unveiled
    "Inside the Stock Markets of Canada - Free Admission to the Fun House of Junior Capital - and - White Collar Crime and Rascality; Now Featuring - Coverage of Varied Cultural Issues; Analysis and Historical Summary by Adrian du Plessis, Investigative Research Analyst"
  • The Action Guide to Government Auctions and Real Estate
    "George Chelekis, one of America's recognized authorities on helping consumers and entrepreneurs increase their buying power presents the step-by-step instructions designed to propel you on the road to success through government auctions and sales."
  • The Magic of Credit
    "Learn how to erase your debts - forever! It can be done if you have the right tools. You can change your mountains of troublesome bills from a nagging worry into a high-powered plan to build your personal wealth and financial security. In his critically acclaimed book, The Magic of Credit, money-wizard George Chelekis shows you step-by-step how to improve, increase, or repair your credit."
Mark Dallara | mdallara@kcii.com | PGP Public Key | Legal Disclaimer
Last Updated: April 09, 2000		 BACK » Occupied Clearwater