The prince claimed he had lost his credit card.
He wanted a replacement.
They were all in an American Express office – the prince, and his bodyguards.
This was a rare situation for the officials. And an extremely stressful one.
The man across them said his parents would be angry if American Express did not give him a new card.
Under normal circumstances, this would mean nothing.
No supporting documents, no proof, no justification. Credit card companies just reject such requests.
But this angry man said he belonged to the royal family from Saudi Arabia.
They gave him a credit card with a $200 million line of credit.
He left with this new credit card.
The name of the prince might be different. But it was always a Middle Eastern prince.
The man’s real name – Anthony Gignac.
1990s and 2000s
Anthony Gignac was born in Colombia, a South American country.
His parents had abandoned him and his brother. A few years later, a couple from Michigan (USA) adopted him.
In the 1990s, when Anthony was in his 20s, he racked up considerable debt.
He had been living in fancy hotels. He rented luxury limousines to go around. He was using credit cards to buy luxury watches, bracelets, and other luxury apparel.
He insisted the hotel staff refer to him as “His Highness” since he was a royal.
Anthony promised the hotel and luxury apparel sellers that his parents would pay all his pending bills.
After thousands of dollars in debt, he was arrested – sentenced to 2 years in prison.
Those who had dealt with him described Anthony as audacious and daring.
“Do you know who my parents are?”
His response when questioned.
That trait set him apart from anyone else.
When suspicions arose, he doubled down and spoke aggressively – instead of becoming defensive.
“Only a true royal would do that”, most people thought.
After serving his 2 year prison time, Anthony came out.
He was not reformed. He had learned no lessons. His spirits were not dampened.
In fact, even his method had not changed. He continued being a ‘royal prince’.
Over the years, the cycle repeated continuously: credit cards, luxury shopping, extravagant cars, top hotels, credit card default, arrest, and prison.
Anthony had a formula he was comfortable with.
He used the formula successfully for around 3 decades.
The time spent inside the prison was a price he seemed comfortable paying.
Bigger Bets
Not bothered, Anthony increased the size of his bets.
In 2017, he connected with an asset manager from England – Carl.
Carl had deep connections in the upper-class networks of England and beyond.
Around the same time, a company called Saudi Aramco was heading for an IPO.
As the name suggests, it is a Saudi company.
Its size was such, that it was easily going to become one of the biggest companies in the world – among companies like Apple and Microsoft.
Via Carl, Anthony offered shares of Saudi Aramco to some rich folks at a ‘discount’. He hinted that the stock’s value could go higher by 5 times after IPO.
He was posing as a Saudi prince and offering some shares at ‘discounted prices’ to his friends.
Anthony was good at his act.
He maintained an extremely lavish lifestyle at all times.
His social media showed him driving around in fancy cars wearing expensive jewelry and watches, and staying in penthouses with great views.
He carried his little dog in a bag with him. That dog too was adorned with jewellery.
It was his charm and charisma that made him believable; that and his anger when he was suspected of being a fake prince.
Saudi Aramco IPO’ed in 2019. None of his ‘friends’ got their shares.
Even Bigger Bet
Around the same time, he was staying in an ultra-posh penthouse.
He reached out to a certain billionaire. He wanted to sell a stake in his real estate.
Anthony was staying in a penthouse in a building with 54 luxury apartments.
He told the billionaire’s associates that he owned the entire building.
The associates sent his private jet to pick Anthony up. They met at a hotel.
There, as the details of the deal were being discussed, Anthony got a call from his house.
Some people had come asking about Anthony and his ownership of the entire building.
This billionaire investor had decided to conduct due diligence before investing. He was trying to verify the details – checking if everything added up.
This angered Anthony to no end. He threw a fit.
How could they doubt a royal prince? Who conducts due diligence on a prince?
He felt disrespected.
Anthony demanded an expensive gift to comfort him.
He told them that it was a custom to give gifts to upset Middle Eastern royals when they were angry.
The next day, they gave him a bracelet worth $50,000.
This satisfied him.
Anthony played his role very well.
He told everyone that he had diplomatic immunity since he was a royal. He showed that his bodyguards all had diplomatic service badges.
Even his cars had diplomatic number plates.
Diplomatic badges and number plates ensure foreign guests visiting the US get certain exemptions in law and order-related cases.
He used to use his diplomatic plates to overspeed and drive dangerously.
Of course, even that was used to show off; to convince others that he really was a royal.
Sitting in that hotel with his newly gifted $50,000 bracelet, Anthony seemed pleased.
And he probably felt that he had escaped – yet again.
But that was not the case.
This particular billionaire investor wanted to make sure he was investing his money in the right place.
His team continued to do their due diligence on Anthony.
The team found that he was renting one apartment – and did not own any apartments in the building.
Finale
A chain reaction was taking place.
The private team doing due diligence on this case found one lie after another.
The team had uncovered a massive scam.
The case grew big enough for the private team. They hand over their findings to government authorities.
A formal investigation started.
They found that he had faked almost everything.
The diplomatic badges and number plates were fake. He used others’ passports while traveling. He rented many of his cars. A lot of his jewelry was fake – and looked real only on social media. His penthouse was rented.
Even his genuine watches and jewelry were constantly bought and sold – making it seem like he owned a lot more than he owned.
It was all a facade.
Anthony had built it remarkably well.
Over nearly 30 years, he had perfected his craft.
Anthony had left the US during this time. He was not aware of the investigation.
They started tracing him as he traveled across international destinations – Hong Kong, Dubai, etc.
When he landed in New York, he was arrested.
In 2019, at the age of 48, Anthony Gignac was sentenced to 18 years in jail.
Scams often come from the least expected sources.
Nobody expects a royal prince to scam them. Not when the prince already seems extravagantly rich.
This is probably why Anthony chose to disguise himself as a prince.
Couple that with some charm and charisma – and even the best of minds can fall for scams.
A lot of transactions happen based only on trust.
Ultimately, what stopped him – and what saved an investor from Anthony – was the same old tried and tested method.
Due diligence.
The images above were generated using AI tools.
Quick Takes
+The Maharashtra government approved 4 projects worth Rs 1.17 lakh cr for EV and textile manufacturing in the state. The projects include companies such as Adani Group, Skoda, Toyota, and Raymond.
+India’s forex reserves rose to an all-time high of $683.99 billion. It increased by $2.3 billion in the week ending on 30 Aug.
+Total automobile sales rose 2.88% year-on-year in August. Passenger vehicle sales fell 4.53%, 2-wheeler sales rose 6.28%, and commercial vehicle sales fell 6.05%: FADA.
+Air India has started the construction of a maintenance, repair, and overhaul facility at Bengaluru airport with an investment of Rs 1,400 cr.
+ECOS Mobility IPOgot listed with a16.77% gainfrom the initial offer price (Rs 334).
+Gala Precision IPO was subscribed 201.41 times. Retail subscription: 91.95. Closed for subscription.
+The Defence Ministry has approved 10 capital acquisition proposals worth Rs 1.45 lakh cr, including tanks and radars.
+Premier Energies IPO listed with a 120% premium. It listed at Rs 990 on NSE and Rs 991 on BSE, compared to the offer price of Rs 450.
+The Ministry of Road Transport is planning to build74 new tunnelsat a cost ofRs 1 lakh crover the 5 few years: Union Minister Nitin Gadkari.
+Telecom service providers in India have blacklisted over 50 entities and disconnected more than 2.75 lakh mobile numbers as part of TRAI’s steps against spam.
+Bazaar Style Retail IPO was subscribed 40.66 times. Retail subscription: 9.12. Closed for subscription.
+Bajaj Housing Finance IPO will be open between 9 to 11 Sept. Issue size: Rs 6,560 cr.
6-Day-Course
Theme of the week: value investing
We’ve reached the end of this week’s course that started on Monday. Here’s a test you should take. Get pen and paper!
Question 1:
Value investing judges a stock on its _____________ potential returns.
-Long-term
-Short-term
-Lifetime
Question 2:
Fundamental ratios such as PE or PB ratios, DCF, etc. should not be used alone, ignoring all other metrics, while selecting a good undervalued stock.
-True
-False
Question 3:
Waiting for a stock to reach its ‘expected fair price’ for too long and missing out on other good investments is called as _____________.
-Fallacy of price
-Value trap
-Opportunity trap
Question 4:
After doing due diligence on a stock by using methods of value investing, every investor arrives on a similar approx fair price of that stock.
-True
-False
Question 5:
PB ratio of a stock is the ratio of its market value to its ____________.
-Fair value
-Future potential value
-Book value
Answers:
Q1: Long-term
Q2: True
Q3: Value trap
Q4: False
Q5: Book value
The information contained in this Groww Digest is purely for knowledge. This Groww Digest does not contain any recommendations or advice.
Team Groww Digest