121:. By his estimate, Watson had embezzled over $ 300,000 from company accounts for personal use. He sued Watson, and subsequently found out that Watson had hidden his 1987 fraud case. Watson responded with a countersuit, saying that Straayer had been the one embezzling funds. Finally. in 1993, Watson and Straayer agreed to dissolve the partnership in a settlement. However, Watson kept the CyberNET name and relaunched it as a reseller.
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in Grand Rapids to four counts of felony mail fraud, and was sentenced to 7½ years in prison. Paul Wright pleaded guilty on August 31, 2007 to federal charges of conspiracy to defraud banks and finance companies, money laundering and mail fraud. He was sentenced to 2½ years in prison. Krista Watson
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On
November 17, 2004, federal agents raided the CyberNET headquarters on South Division Avenue in Grand Rapids, seizing the business and all of the Watsons's personal assets. Although he had not yet been charged, Watson knew that he faced decades in prison if convicted. He went incommunicado until
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Investigators quickly got in touch with former CyberNET accountant Guy
Hiestand, who had suspected shady doings at CyberNET for some time. However, he had never actually reported it because he did not know the culprit. Investigators discovered that CyberNET had rooked four banks into loaning money
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computers as well as providing design and installation for clients. Starting in 2000, however, Watson began to obtain fraudulent loans from a large number of financial institutions based on faked and forged financial statements. By 2002 the
Watsons were living a fabulous lifestyle, owning a
167:, where he posted numerous anecdotes and observations from his luxurious travels, which often entailed flying to cities around the world in first class. His username on FlyerTalk was "B Watson", and his posts on FlyerTalk remain viewable to this day.
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in the fall of 1978. While in Ann Arbor, Watson also volunteered at an ambulance company. He dropped out after only one semester and returned to
Belding to help his mother run a local automobile service station.
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Watson soon managed accounts worth over a million dollars. However, once it emerged that he had embezzled more than $ 700,000 in funds from nine clients, E. F. Hutton fired him in
January 1985. The
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Afterward, he moved to Grand Rapids where he worked as a sales clerk at a large computer store. By 1990 he had met John
Straayer, and together they founded a company called WS Services, a "
149:. This lifestyle, and an ultimately unsuccessful attempt to expand the business internationally, were financed by an ever-increasing number of fraudulent loans. In what became a classic
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subsequently banned him from the securities industry for life. He went on the lam, but was caught and arrested in San
Francisco five months later. In May, 1987 Watson pleaded guilty to
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After meeting his future wife, Krista
Kotlarz, in 1991, Watson's relationship with John Straayer deteriorated. It bottomed out in 1992 when Straayer discovered Watson was keeping
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in the early hours of
November 24. It was subsequently determined that CyberNET and the Watsons had over $ 100 million in debt against approximately $ 2 million in assets.
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Watson engaged in other fraudulent schemes as well. For instance, one of his salesmen uncovered an attempt to pass off remanufactured computers as new and sell them to the
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and told the operator that he had a gun in his mouth. This triggered a lengthy standoff with Watson barricading himself in his home. It ended when Watson committed
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Watson was the son of
Geraldine Watson (née Johnson) and Gerald Watson, a well-respected local merchant. Bart, as he was known as a schoolboy, grew up in
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Upon his release from prison after more than two years, Watson returned to Belding and lived with his father for six months, working as a server at a
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pleaded guilty on September 4, 2007 to federal charges of conspiracy and tax evasion, and was sentenced to seven years in prison.
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Following the divorce of his parents and as a result of financial pressures, Watson and his mother Geraldine moved to the
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office in Grand Rapids to potential fraud at CyberNET, such as fraudulent loans and forged invoices. The
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school system. However, a civil suit by the school system ended in an out-of-court settlement.
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for new equipment before depositing it into shell companies to keep the company afloat.
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episode 13 "The Rise and Fall Of CyberNet" which originally aired March 12, 2008.
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Between 1991 and 2000, CyberNET was a moderately successful reseller of
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On June 22, 2006, CyberNET president James Horton pleaded guilty in
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The United States Attorney's Office – Western District of Michigan
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The United States Attorney's Office – Western District of Michigan
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In December 2003, an anonymous CyberNET employee alerted the
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Watson was a very active participant on the travel website
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area in 1981, residing for a short time in an apartment in
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for mail fraud, unveiling nearly US$ 100 million in debt.
19:(October 18, 1960 – November 24, 2004) was the founder of
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347:"CyberNET Ranked #110 - 2004 VARBusiness 500"
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85:National Association of Securities Dealers
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195:the night of November 23, when he called
95:to one to three years in federal prison.
411:(Television Production). United States:
246:(Television Production). United States:
327:"Dead on Arrival: The CyberNet Scandal"
185:United States Postal Inspection Service
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262:"Farewell B Watson - FlyerTalk Forums"
363:Watson was the subject of the CNBC
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187:quickly joined the investigation.
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409:: The Rise and Fall of CyberNet
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244:: The Rise and Fall of CyberNet
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457:People from Belding, Michigan
452:University of Michigan alumni
325:Wright, Robert (2005-06-12).
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133:and driving a Land Rover, a
107:restaurant in Grand Rapids.
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91:and was sentenced by Judge
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462:People from Ada, Michigan
181:Internal Revenue Service
171:Raid, suicide and trials
129:million-dollar home in
387:. New York: CNBC. 2008
309:April 7, 2008, at the
291:April 7, 2008, at the
49:University of Michigan
382:"Fraud in Cyberspace"
447:Suicides in Michigan
112:value added reseller
99:CyberNET Engineering
70:Alexandria, Virginia
21:CyberNET Engineering
432:American fraudsters
208:U.S. District Court
45:Belding High School
17:Barton Harry Watson
158:Hastings, Michigan
43:. Barton attended
119:two sets of books
93:Gerhard A. Gesell
37:Belding, Michigan
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151:Ponzi scheme
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41:Grand Rapids
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442:2004 deaths
437:1960 births
385:(Slideshow)
105:Red Lobster
78:Perry Bacon
426:Categories
391:2010-07-12
356:2010-07-12
350:(Web News)
336:2010-07-12
330:(Web News)
272:2014-09-16
215:References
89:mail fraud
165:FlyerTalk
53:Ann Arbor
31:Biography
307:Archived
289:Archived
266:Archived
145:and two
415:. 2008.
250:. 2008.
201:suicide
143:Bentley
135:Ferrari
352:. 2004
126:Compaq
197:9-1-1
413:CNBC
248:CNBC
183:and
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177:FBI
139:BMW
51:in
25:FBI
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