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HomeLife In the BerkshiresCONNECTIONS: Bamboozled Berkshires

CONNECTIONS: Bamboozled Berkshires

While we like to think the Berkshires is populated with good people and only good people, we are not always right. The combination of bad actors and naiveté has resulted in more than one Berkshire swindle.

About Connections: Love it or hate it, history is a map. Those who hate history think it irrelevant; many who love history think it escapism. In truth, history is the clearest road map to how we got here: America in the 21st century.

Editor’s Note: To better illustrate the observations in this article we found a photo of the Shakespeare & Company campus that had been, prior to the theatre company’s rescue of the property, the location of two of organizations mentioned in this piece. The photo of the former DeSisto School parcel that had originally led this article is located below. 

“Bamboozled Berkshires” is a reprint of an earlier column. This version is expanded, but not as far as it could be. There still are more scams, some mentioned to me by readers, not included and awaiting a third column. This one is reprinted by request. Why request it now?

For decades Berkshire folk discussed, strategized and hoped to make this a year-round destination. All of a sudden, we are. We have been discovered; we have never been so popular and there are scores of plans for development. Museums are planned in North County; in South County, Tanglewood is expanding, Elm Court is building and DeSisto is knocking at the door. New motels are appearing everywhere in between. None of these are necessarily scams; all may succeed, some may fail, any may enrich the Berkshire experience, and many will change the very things that drew them here. How do we know which is which?

Gravestone of Col.Simon Larned in the Pittsfield Cemetery. Photo courtesy findagrave.com

We are not infallible. And while we like to think the Berkshires is populated with good people and only good people, we are not always right. The combination of bad actors and naiveté has resulted in more than one Berkshire swindle.

Col. Simon Larned (or Learned) was born in 1753, fought in the Revolutionary War and settled in Pittsfield in 1784. In 1788 Larned purchased land from Charles Goodrich and he built a house. It was described as “a commodious…attractive mansion.”

Larned farmed his land and, according to advertisements in the Pittsfield Sun, ran a barter business. Larned traded wheat for nails, house ashes for West Indian goods and pot ashes for cotton. He served in elected positions including sheriff. In 1806 Larned was named the first president of the new Berkshire Bank.

Anxious to increase his fortune, in 1809 with James Colt, Elkanah Watson and Joshua Danforth, Larned founded the Pittsfield Wool and Cotton Factory. Berkshire Bank funded the new enterprise and so the fates of the two were intertwined. The same year the factory opened, there were no fewer than 50 lawsuits filed against Berkshire Bank. All were actions brought by Berkshire County residents attempting to get their money back, but there was no money in the bank. The bank failure wiped away the financial support for the factory and it failed.

All the Berkshire Bank directors were local men, but the moving force behind the bank was a Bostonian named Andrew Dexter. The total deposits in the bank – $80,000 – disappeared and Dexter disappeared at the same time. Neither the man nor a single dollar was ever seen again.

The Rev. Carl H. Stevens Jr. Photo courtesy Greater Grace World Outreach

Nevertheless, the court held the local bank directors, Hurlbut, Pepoon, Colt, Danforth and Larned responsible. They could not repay the depositors’ money and so their property was seized for partial payment. In addition the directors were jailed. During the whole of his incarceration, Larned retained the position of Pittsfield sheriff. He also retained the respect of people of Pittsfield. Regardless of the court finding, Pittsfield never blamed Larned or the other directors. Pittsfield as a community blamed Bostonian Andrew Dexter.

Almost 200 years later, the Rev. Carl H. Stevens Jr. came to Lenox and founded The Bible Speaks ministry. Between 1984 and 1985, heiress Elizabeth (Betsy) Dovydenas donated an amount alternately reported as $5.5 million and $6.5 million to The Bible Speaks. Dovydenas also changed her will, leaving her estate to the ministry and disinheriting her children and husband, Jonas.

In 1986 Dovydenas brought a lawsuit against Stevens and The Bible Speaks, seeking to recover her money, on the basis that Stevens had unduly influenced her. The judge ruled in Dovydenas’ favor and wrote in part: “Testimony revealed an astonishing saga of clerical deceit, avarice, and subjugation” by Stevens, who “abused the trust of the claimant as well as the trust of many good and devout members of the church.” The Bible Speaks declared bankruptcy and lost the property in Lenox.

In 1983 a man was dragged out of a house and carted off to jail. The house was on Prospect Hill Road in Stockbridge – maybe not the last place on earth, but certainly one of the last places one could imagine it happening. His name was – or perhaps not – Thilo Rethmann.

He was the houseguest of the wonderful Marge Champion. He was adored in the Berkshires as the son of a wealthy German family. He was waiting a multi-million-dollar inheritance. While he waited he took Hollywood by storm, writing a screen play and rubbing shoulders with movieland elite. At the very moment he arrived in the Berkshires, he was waiting for the release of his first film. As he waited he was soliciting backers for his next movie.

Luxury hotel and restaurant Wheatleigh in Stockbridge

Busy, busy Mr. Rethmann saw Wheatleigh and, while Mr. and Mrs. Linfield Simon had just purchased the property for $500,000, he offered $2 million. It was an irresistible flip and the Simons accepted. Therefore, they – you guessed it – waited for their money. All waited in vain.

Rethmann was wanted in Los Angeles for grand larceny – good that he actually had done something grand. He was wanted by U.S. Immigration for bearing false witness on a federal document and for overstaying his visa. Interpol was interested in him but did not specify the reason.

He was held for competing law enforcement agencies in the United States and abroad to take him away. No one is waiting for him to return.

In 1993, the National Music Foundation moved from the state of Florida to the same 63 acres in Lenox once occupied by Bible Speaks (and now the campus of Shakespeare & Company) with the expressed purpose of building a $30 million music center. Eighteen years later it was proclaimed a boondoggle that wasted $3.6 million in public money. In the interim, elected officials on every level of Massachusetts government and the Berkshire business community sang the praises of the Foundation and stood for celebratory photographs.

The Foundation letterhead included the names of famous musicians as well as music promoter Dick Clark. It declared its intention to build a performance center, music museum and retirement home for American musicians. The mission was to celebrate American music from classical to pop. There was backslapping and dreams of a second Tanglewood next door to the first. There was pontificating about job creation, influx of tourist money, saving historic buildings on the property, and creating a magnet for the rich and famous to visit Berkshire.

One of the names on the letterhead of the National Music Foundation Dick Clark.

The wheels came off the wagon in 2010 when the Foundation was unable to raise the matching funds required by a $2.5 million grant. Knowledge dawned that letterhead and a mission statement do not a corporation make. The boasting was replaced by an equally loud demand for recovery of the money. Nothing much happened: A lien was placed on the property, but the property sold for less than the money owed; the director (and presumably the dreams for a music foundation) slid back into Florida, and Lenox was once more a quiet village.

In 2011, in a 26-page report, Massachusetts State Auditor Joe DeNucci said the National Music Foundation in Lenox “misled public officials and misused government funds.” DeNucci accused the nonprofit of spending government grant money for “extravagant expenses that had no apparent business purpose.”

In 2008, all the dreams for “1,000 new jobs in Pittsfield” and the return of a business “as big as GE” ended in a U.S. District Courtroom when Michael Armitage of Pittsfield was indicted on charges of bank fraud, money laundering and making false statements (to almost everyone he ever spoke to).

Michael Armitage in federal court, under indictment.

Before his fall, Armitage’s rise was meteoric. EV (Electric Vehicles) Worldwide was going to revolutionize movement. If a car, train, bus, maybe even a bicycle moved, it could be powered by hydrogen fuel cells. EV Worldwide, dba ElectraStor LLC, would manufacture the battery that stored hydrogen. It would manufacture it in Pittsfield.

Even Rep. John Olver, then-chair of the House Transportation Subcommittee, hustled through a $1.35 million federal grant. That was followed by another federal grant in the amount of $800,000. With special irony, Mayor Jerry Doyle granted EV Worldwide  $250,000 from the GE Economic Development Fund.

Everyone jockeyed for position, endeavoring to be close to Armitage and partner Christopher Willson when the announcement was made. Newspapers, politicians and pontificators said the company was a “potential major employer”: it would renovate Pittsfield factories because its hydrogen-fuel cell batteries were “the wave of the future.” The comparison with GE in the last century was irresistible. Then the bubble burst, the key players went to prison and the boosters were eerily silent.

In October 2010, Armitage pleaded guilty to the charges of tax evasion and vowed “a comeback.” One can only hope not.

Why do we fall for it? All good con men offer what you most want. The promises to the Berkshires are always the same: They will create jobs, they will rejuvenate the economy, they will save historic buildings and their taxes will lower taxes for the rest of us. And yet, are Berkshire folk especially vulnerable to hustlers and con men? Maybe.

The former DeSisto School on Route 183 where developers have proposed a complex of houses and condominiums.

Our history may make us believers without sufficient evidence. In the 19th century, they came here – the richest and most famous. They came in wave after wave: the intelligentsia, the literati, the artists and the millionaires. It makes it more believable that they will come again. Name-dropping has a familiar ring here and does not as readily elicit a sniff and a “yeah, sure” as it might elsewhere. The cache of all those famous names is part of our past. Our past informs us that we were a magnet for the best and the brightest and, if then, why not now? It may be the wrong lesson from the past.

We are nice people, and nice people often have trouble imagining a worst-case scenario. We have a propensity for pipe dreams and a paucity of due diligence. What history teaches is that we need to reverse those two.

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