OFFICE OF THE UNITED STATES ATTORNEY
WESTERN DISTRICT OF MISSOURI
JOHN F. WOOD
Contact Don Ledford, Public Affairs ● (816) 426-4220 ● 400 East Ninth Street, Room 5510 ● Kansas City, MO 64106
JULY 3, 2007
FOR IMMEDIATE RELEASE
FORMER KC MAN PLEADS GUILTY
TO ‘BAYWATCH’ FRAUD
KANSAS CITY, Mo. – John F. Wood, United States Attorney for the Western District of Missouri, announced that a Kansas City, Mo., man pleaded guilty in federal court today to a fraud scheme that bilked 18 investors out of nearly $360,000.
David William Port, 53, of Kansas City, Mo., a resident alien from Great Britain at the time of the offense, pleaded guilty before U.S. District Judge Howard F. Sachs this morning to the charges contained in an April 2, 2003, federal indictment. Port was a fugitive from justice on a state conviction for securities fraud in New York and became a federal fugitive when the indictment was returned. Port was recently extradited from England and remains in federal custody.
“Victims of the scheme thought they were investing in a company that would produce high returns because of its worldwide syndication rights to the popular ‘Baywatch’ TV show,” Wood said.
By pleading guilty today, Port admitted that, from October 1998 until October 2000, he devised a scheme to defraud potential investors in Kansas City-based PCG Media, a production and marketing company. Port solicited potential investors in PCG Media by means of false and fraudulent representations. Port then misappropriated the victim-investors funds for his own and others’ benefit.
As part of the fraud scheme, Port told potential investors that PCG Media owned the rights to syndicate the television program “Baywatch” in 17 foreign countries and the rights to merchandise “Baywatch” promotional items, when in fact it did not own such rights. Port told potential investors that PCG Media had entered into an agreement to open “Baywatch” restaurants, which were to take over the Planet Hollywood restaurants, when in fact it never entered into such an agreement. Port also told investors that he had met several times with “Baywatch” star David Hasselhoff, and that Hasselhoff was investing in PCG Media, neither of which was true.
Port also told potential investors that PCG Media was the biggest buyer of t-shirts from the Fruit of the Loom company and had a current multi-million dollar transaction in the t-shirt printing industry, when in fact neither was true. Port claimed that his merchandising clients included Coca-Cola, McDonalds, the UK Lottery and Philip Morris, which also was not true.
Port failed to disclose to potential investors that he was convicted in 1994 in the United Kingdom of obtaining property by deception.
Port fraudulently represented to a potential investor that PCG Media was financially sound, with a value of approximately $20 million, when in fact the company was not financially sound and the value of the company was negligible. Port represented to a potential investor that PCG Media had a cash balance of $275,000, providing a balance sheet that was materially false and fraudulent, when in fact the cash balance was approximately $1,000 or less.
Port told potential investors that he owned the publicly-held and publicly-traded company PCG Media, when in fact the company was neither publicly held nor publicly traded but instead was privately held. Port told potential investors that PCG Media was traded on the NASDAQ market, and issued phony stock certificates.
Port pleaded guilty to five counts of the federal indictment that charge separate instances in which Port engaged in the interstate transportation of money obtained by fraud. Those offenses involved wire transfers of money from victim-investors in England, Utah, New York, California and Delaware in amounts ranging from $5,000 to nearly $75,000.
Under federal statutes, Port could be subject to a sentence of up to 50 years in federal prison without parole, plus a fine up to $1.25 million and an order of restitution. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Linda Parker Marshall. It was investigated by the Federal Bureau of Investigation.
This news release, as well as additional information about the office of the United States Attorney for the Western District of Missouri, is available on-line at