A get-rich-quick blackmail scam devised by teenagers from an affluent Auckland school culminated in a citizens’ arrest and a court date. 

But three years on, the case has concluded with a discharge without conviction, permanent name suppression and a victim questioning if justice was done. 

George Block investigates a North Shore crime caper gone awry. 

“Hello, I know what you’re doing,” the email said. 

“One call to the Serious Fraud Office and it costs you a lot of money. Lucky for you I’m more interested in personal gain.” 

The recipient was an Auckland businessman with a colourful past. 

He has had some run-ins with the authorities and copped mixed media coverage, but now runs legitimate businesses. 

But the senders of the email were not anonymous scammers sending out mass emails from the other side of the world. 

They were just two teenage boys, friends from a Grammar school in Auckland, who thought they had found their cash cow. One had a loose familial connection to the businessman. 

Their anonymous email on October 16, 2020, alleged wrongdoing by the businessman - without evidence - and said the only way he could stop the senders dobbing him into the Serious Fraud Office (SFO) was to pay up. 

They asked him to reply with how much he was willing to pay to stop the tip-off happening. 

“Reply to the email above with how much you think your freedom is worth. I’ll call up SFO on the 20th if I don’t get a response before then. 

“Hope you can respect my hustle.” 

Further emails followed and the teens ended up demanding a lump sum of $15,000 via bitcoin and an ongoing $2000 maintenance payment. 

This is where Mike Gillam of The Investigators comes in. 

Gillam is a former cop turned PI who had worked with the businessman before. 

He and his team took over the businessman’s email correspondence with the teens and claimed not to know how to make payments via bitcoin. 

They convinced the teens to accept the first payment in cash with a promise to learn how to use bitcoin for future transactions. 

The sting was on. 

Court documents obtained by the Herald and an account provided by Gillam with the consent of the businessman, who asked to remain anonymous, reveal what happened next. 

The setup 

Gillam and his team managed to negotiate a week with the scammers purportedly to arrange withdrawal of the funds before the drop-off. 

That allowed them to secure prop currency resembling stacks of hundred dollar bills. 

They hid the prop cash and a discreet GPS unit inside a backpack. 

Some paper money and a GPS tracker were hidden inside this backpack ahead of the fake money drop. Photo / Supplied 

Gillam rustled up a team of investigators ahead of D-day. 

They included a “lead communications agent,” a police liaison, staff tasked with wrangling the scammers and a drone operator. 

The sting 

On the day, the teenagers emailed a list of rules about 6am. 

They sent a photo showing where they wanted their mark to throw the backpack over a fence on a quiet street in a North Shore suburb. 

The teens warned the area would be under surveillance and if anything seemed amiss they would abort and go through with their threats. 

About three hours before the noon drop-off time, the undercover team arrived at the spot. 

They undertook what Gillam describes as “counter surveillance observations” and saw nothing to indicate they were being watched. 

The operator launched a drone 20 minutes before the drop-off to keep an eye on the area from above. 

Five minutes ahead of the drop one of the teens called up to say he had been observing the location and was pleased the client was following instructions. This turned out to be a bluff. 

They changed the drop location at the last minute to a disused bus stop near Narrow Neck Beach and ordered the businessman to leave the backpack there in an hour’s time. 

He and the investigators drove to the new location. The businessman went and placed the backpack inside the old bus stop and left. 

About 20 minutes later, the two teens arrived in an SUV belonging to one of their fathers. 

One left the car and ran to the bus stop while the other hung a U-turn preparing to flee the way he came. 

The investigators saw the teenager give a thumbs up to his accomplice after looking inside the backpack and apparently being convinced by the fake cash. 

The teenager gives a thumbs up from the disused bus stop. But things are about to take a turn for the worse. Photo / Supplied 

They parked two cars behind their SUV, blocking one route of escape. Gillam rushed out of the car park from his observation spot and managed to block the other side of their vehicle with his car just as the teen got back to the vehicle. 

The investigators placed the pair under citizen’s arrest. 

Gillam said the bagman was immediately compliant but the driver kicked off and required some restraining. 

Police arrived and took the pair into custody. Both were charged with blackmail. 

The case 

While both teens were arrested only one went on to appear before the District Court. 

He eventually pleaded guilty to blackmail, carrying a maximum penalty of 14 years in prison. 

The teen's in custody after police arrived. Photo / file 

His lawyer, Peter Syddall, managed to obtain a discharge without conviction for the teenager and permanent name suppression. 

The suppression hearing at the North Shore District Court earlier this year was attended by the teenagers’ parents but not the teen, who is away at university in another city. 

Judge Clare Bennett agreed with Syddall the threshold of extreme hardship required for permanent name suppression had been met. 

The Judge referenced the fact the frontal cortex of the brain is still developing in teenagers, which can limit their reasoning ability or tendency to think before they act. 

“This offending was pretty serious, but it certainly had the ring of youthful stupidity for it,” Judge Bennett said. 

However, Judge Bennett allowed the Herald’s application to access the summary of facts to which the teen admitted. 

The businessman said he was astounded that after being caught red-handed and staring down the barrel of a 14-year jail term, the teen has escaped with no penalty. 

“We had him ... dead to a tee,” he said. 

“We’re blown away he got a discharge without conviction and full suppression.” 

He was full of compliments for Gillam and his team and seemed relatively sanguine about the unsatisfactory conclusion to the saga. 

“Fortunately Mike did a fantastic job for us. 

“Unfortunately in New Zealand you get a lot of s*** thrown at you now and then and you just have to deal with it and move on.”