Several of the privately-held Circus Capital companies had links to British military research center Porton Down, where Boulter had security clearance and arranged investor tours. Among them was Alaska Food Diagnostics, which focused on pathogenic diseases in food. Another was microbial detection platform Acolyte Biomedica. The most popular was Enigma Diagnostics, where investors directed around £ 106 million ($ US188 million) to back rapid testing kit prototypes.
Interested investors, often introduced to Boulter by their financial advisers, would send money to the businessman to buy shares in anticipation that industry giants might snap up the early-stage ventures and send valuations soaring.
“The idea was that these were technologies that were effectively part of the structure of the MOD,” said Steve Baker, founder of Orion International, a Malaysia-based wealth manager that steered around 10 million pounds to Boulter.
Circus Capital had raised more than $ US220 million by 2003 before the firm’s protected funds unit suffered a sudden drop in the value of the underlying assets. Hong Kong’s regulator probed how the funds were marketed, with compensation eventually paid by a wealth management firm Circus Capital had used. Boulter emerged unscathed and moved to the United Arab Emirates where he relaunched his venture as Porton Capital.
He expanded his sales team, offering hefty commissions to firms that sold his products. He led presentations and flew in senior portfolio managers to his lavish offices.
As the money rolled in, Boulter did not hide it. There was a Sunseeker yacht, sports cars, the safari park in Namibia, a lodge in Montana, and a $ US26 million custom-built mansion in the UAE, with eight bedrooms, a 5,000-bottle wine cellar, staff quarters, cinema, and military-grade security system, according to a sales guide.
While working at a Kazakh oil refinery, Jeffrey Temple was introduced to Porton via a broker. He backed several firms, including the Wales-based blood-testing device designer Microvisk, in part because his mother had suffered a stroke and such a device would end the need for her weekly trips to the doctor, he told Bloomberg in an interview.
Temple studied Porton’s periodic updates that included plans for initial public offerings and possible sales. Goldman Sachs and Jefferies Financial Group were named as advisers. As the years passed, Temple grew concerned when none of these sales materialized. So did other Porton investors as well as several owners of the wealth management firms that had promoted Boulter to their clients.
Temple, 70, said he began visiting his portfolio companies and promptly got emails and calls from Porton staff, including Boulter, telling him to back off.
In early 2014, Boulter called. “Over quite a few minutes, I was shouted at and bullied,” Temple said. “He threatened me with his legal team and said he would block me from any future investments.” Boulter demanded Temple sign a non-disclosure agreement if he wanted further information, emails show.
Other alarmed investors did similar legwork. In Asia, the now shuttered “Smart But Enigmatic” blog compared the share price on Porton contracts to the newly issued share price information in Companies House documents. Investors were often paying many multiples more.
Investors gradually realized Porton was neither a venture capital fund charging ongoing fees to investors nor a broker levying a one-off fundraising charge. “It’s not something I’ve seen before,” said Chris Sier, head of ClearGlass, a consultancy that advises on fees and returns in private markets.
Many client documents came with the logo of DLA Piper, one of the world’s largest law firms, and included details of partner Charles Cook, who handled the Porton account, according to the lawsuit. Investor money was to purchase a beneficial interest in the shares of the portfolio companies, court documents said. Investors and even wealth manager partners who spoke to Bloomberg said they thought they were buying newly issued shares from the companies. In fact, they were buying the marked-up shares from Porton after Boulter had bought them. Porton would continue to hold the shares as a nominee for the investors, meaning it was Porton’s name on the shareholder registry.
In a lawsuit filed last year in English courts, liquidators for the now defunct Enigma Diagnostics alleged that of the £ 106 million sent to DLA Piper’s bank account, only 42 million were transferred to Enigma. The rest, £ 64 million, was paid to Boulter or his associates.
Boulter does not dispute where the bulk of the money went. In court documents, he said investors either knew or should have known how his firm worked. Porton bore the risk of first buying shares in the firms it promoted and “was entitled both to determine the timing and price” at which those shares were sold.
DLA Piper and Cook were also named as defendants in the ongoing case. The money transfers breached rules governing how law firm accounts should be used, liquidators FRP Advisory alleged.
“We are committed as a firm to upholding the highest principles of ethics and professional standards and do not consider this claim to have any foundation,” a spokesperson for DLA Piper and Charles Cook said by email, declining to comment further.
In a separate court action, a Cayman Islands judge ruled earlier this year that Boulter did not make fraudulent declarations of solvency when winding up Porton in 2017.
By that time, Boulter was in legal trouble elsewhere, according to court documents filed in South Africa as part of his divorce hearing. In 2016, Boulter left the UAE for Namibia after being arrested at Dubai airport for an unspecified reason. In May 2017, while “severely intoxicated,” he strangled his ex-wife “to the point of unconsciousness” at her home in Virginia in the presence of their young children, court documents say. He was charged and a protective order restricted contact with his wife. Boulter has denied the assault allegations.
Other examples of alleged erratic behavior have emerged. In 2011, Boulter took offense at how slowly Ferrari had fixed a seat belt and demanded in an email that the company take back his more than 10 cars. “The brand for me is lost,” he wrote, according to an email seen by Bloomberg.
That same year Boulter came to public prominence when he revealed a friend of Conservative Party minister Liam Fox was promoting himself as an official adviser. Fox resigned following a public outcry. He later sued Boulter for libel because Boulter told US conglomerate 3M that Fox told him the UK government was reviewing an honorary title bestowed on 3M’s chairman. In fact, one of Boulter’s portfolio companies was locked in a lawsuit with 3M. Boulter settled the libel suit and issued a statement apologizing to Fox and affirmed the two had never discussed the 3M chairman.
Boulter went on to finance the failed campaign of a UK Independence Party candidate who ran against Fox in 2015 as well as a second candidate running against Conservative politician Tom Tugendhat, son of the judge who oversaw that libel case.
Then came the brawl last year. At a fireside confrontation with his lodge manager Gerhard Van Wyk, Boulter shot him in the abdomen. Boulter told The Daily Mail it was unintentional. A trial date has yet to be set. His investors will be watching.
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