|
Genesis World Energy Under Investigation for Fraud
Sterling D. Allan Dec. 9, 2003 TRENTON NJ, USA
Genesis World Energy (GWE) claims to have a revolutionary technology that will "[harness] an unlimited source of energy from the molecular structure of water." Scientists such as Bob Park of the American Physical Society question the claim, and now Attorney Generals are investigating the securities of the company, who receives stock through a sister company, United Fuel Cell Technologies (UFCT). Just over one year ago, GWE held a press conference in Boise, Idaho in which they claimed that their "technology breakthrough utilizes a fuel cell that consumes nothing but water to generate energy. Using the amount of water an ordinary bathtub can hold, this fuel cell unit will produce enough energy to last a household more than 20 years. The unit produces no byproducts. No residential retrofits are required — the unit uses existing electrical wiring and natural gas plumbing. The unit has no moving parts and is silent." (Idaho Statesman; Dec. 6, 2002) They claim that their home power generator will cost approximately $3,000; and that their commercial unit will cost $9,000. Potential licensors and investors have lined up to be part of this seeming unprecedented opportunity. The GWE website (genesisworldenergy.org) claims that they are ready to go in 140 nations. Just what the device can or cannot do is yet to be determined, though the evidence points to it being a technology modified from a fuel cell device available for purchase at http://www.hammacher.com/publish/64680.asp; and that it will not perform anything near the level being claimed by Genesis World Energy (GWE). Early on, John Lichtenstein, a watchdog in the alternative energy field, saw things about the GWE claims that smelled to him like a con job, so he began a private investigation into the claims and the affairs of GWE. (http://members.cox.net/john.lichtenstein/) Lichtenstein reports that the UFCT filed an application for corporation registration in Sept. of 2001, but they never paid the franchise taxes, or the application fee. He also notes that they never registered their shares, even though there are more than 100 investors according to investor reports. GWE was registered two years later in Sept. 2003. GWE did not confirm or deny a report Lichtenstein published in Feb. 2003 that stock had been sold in GWE's Edison Device under the name of UFCT by Pat Kelly. Lichtenstein's concerns reached the ears of Dean Kuehnen, who is an Investigator with the Attorney General's office in New Jersey. Kuehnen's primary target of investigation is NJ resident, Patrick Kelly, who is the purported inventor as well as de facto founder and director of UFCT and GWE. Kuehnen, says they have enough information now to begin "tightening the screws" on Kelly and his cohorts. New Jersey is not the only state investigating GWE. Kuehnen is not at liberty to divulge what other states are involved. Their main charge in the investigation is not functionality but securities. Kuehnen is confident that he has a strong case of securities fraud, and plans to turn the case over to "a mean criminal justice." "I'm not concerned whether or not the technology works," says Kuehnen. "If it works, I'll buy one. What I'm concerned about is the investors." A potential licensee who requested that his identity not be revealed, who has not yet seen the technology, but who is poised for a significant marketing interest, says that GWE does not expect any transfer of funds until after the potential licensee has seen the technology and has been able to test it in an independent laboratory. He thinks Kuehnen is "trolling for information" against GWE but that GWE is too well established internationally at this point to be stopped. Kuehnen sees this this as a probable slight-of-hand tactic of GWE, designed to create an illusion of respectable science and business on the one hand, while waiting for people to line up as investors on the other. The potential licensee says GWE has explained to his satisfaction the need to raise $20 billion to finance the world-wide distribution of this technology. The near air-tight non-disclosure agreement (NDA) of GWE keeps most involved parties zip-lipped, making the investigation more difficult. However, enough people have become sufficiently concerned about inconsistencies they have seen that they have voluntarily stepped forward with their testimonies. Those who have requested a refund of their money have been put off with delays and excuses. In some cases their request is denied with the claim that they breached their NDA. Alternative energy enthusiasts are nonplussed by charges of breach of lawful business conduct, for most of them are empathetic with "how difficult it is to dot every I and cross every T" of the "convoluted legal requirements." They are more concerned about bogus technology being passed off as genuine when it is in fact a scam. "It gives the whole field a black eye, making it all the more difficult for legitimate research to see the light of day." According to Kuehnen, there are basically two devices that GWE shows to those who have signed their NDA, and who are investigating the technology to become involved either with a license or investing. One is a larger device, fully enclosed.
The other is a smaller device with a fan attached to demonstrate output power. According to the witnesses reporting to Kuehnen, the smaller device bears a near identical resemblance to a device sold at http://www.hammacher.com/publish/64680.asp
Those who have seen the smaller of the GWE devices and then see the Hammacher Schlemmer (HS) device vouch that it is the same thing except the HS device turns a wheel, while the GWE device has been modified to turn a fan. This device is routinely shown to GWE interested parties bound under NDE as a bench-top proof of concept. "They'll let it run for 15 minutes, and the people watching will think, They're onto something." The other device that is shown is the larger unit. Kuehnen does not know of any witnesses that have seen it in operation with the lid off. Instead, the reports he heard is that GWE personnel refuse to let people peek inside. Lichtenstein says there is a person, "Anthony Marchetti" (not true identity) who has claimed to see inside while the unit is running, and has posted this assertion to the ZPEnergy.com site. Those who have spoken with Kuehnen say that most of the time, GWE gives excuses as to why this larger device can't be shown, including: "It fell off the plane;" "It got lost in the mail;" "A part broke off it and needs to be repaired;" "It shorted out." Kuehnen wonders if the inner workings of this unit that are shown in photographs could have been pulled together for the sake of a photo, and that they are not actually a functional part of the purported technology.
Others find it hard to believe that something so well presented could be fraudulent. The potential licensee replied, "They do give a public peek inside (photo), and they do try to explain how the technology works, and those explanations are nominally in harmony with other patented or published works." The physicists with whom Kuenen has conferred do not agree that the explanations given by GWE are sound. Alternative energy enthusiasts are not deterred by such professional skepticism, recalling that scientists in the days of the Wright Brothers said man could not create a flying contraption. An explanation they have a harder time dismissing is one in which each of the components is analyzed from a point of view of what would be required to accomplish what GWE claims. Reviewing the photos, Stephen Zorbas says that there should be very thick wire for the DC and there is none visible; there should be "test past" stickers on the fuel cells and there are not; the tubing is not the grade of tubing you would need for Hydrogen gas. Lichtenstein observed that GWE's claim that hydrogen gas could be run in existing home gas plumbing betrays a fundamental flaw in the GWE engineer's understandings, for hydrogen gas corrodes regular gas plumbing. The GWE home page asserts that "every major automobile manufacturer in the world requested licenses to equip new cars, trucks, SUV's, and mass transit vehicles" with the GWE technology. Kuenen has contacted Honda, IBM, and HP, all of which GWE claims to have brokered relationships or potential relationships, and they all say they have not heard of Kelly nor of GWE. "There are not 400 scientists" behind the development of GWE, says Kuehnen, though not able to specify how he knows that. A mention of a phone tap prior to that statement provides some possibilities. Kuenen has much more about GWE, but he is not at liberty to divulge that at this time. "The legal process takes time. [Often], by the time we get to them the money is gone," said Kuehnen. He is anxious to have additional witnesses step forward, and on December 4 posted a statement soliciting such at an Internet discussion forum. (http://www.h2eco.org/wwwboard/messages/2426.htm) Regarding the contention that witnesses will be difficult to attain because of the tight NDA they have with GWE, Kuehnen replied, "when a technology is under official investigation, the non-disclosure agreement is null and void." He could not recall from from memory specific reference to a law that supports that statement. The potential GWE licensee said he had a friend with a working technology that he personally witnessed that "was targeted by the attorney general's offices of nearly all 50 states," and that "securities and exchange violations are a very common way to shut down" technologies that have the potential of unseating some of the most powerful people and companies on the planet. His associate was able to proceed notwithstanding the opposition he received. "I don't think Genesis World Energy will be able to be proven a fraud," he said. He is undeterred by the fact that he was supposed to have seen a demo in July 2003, and has not yet seen that demo four months later. -- SDA
Relevant Materials
Contacts
Page created by Sterling D. Allan
Dec. 9, 2003 |
|
|
