Finance:Dominion of Melchizedek

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Short description: Micronation
Dominion of Melchizedek

Micronation
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Motto: Unitarianism, unity, peace
StatusCurrent
Establishment
• Declared
1990
Website
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The Dominion of Melchizedek (DoM) is a micronation known for facilitating large scale banking fraud in many parts of the world during the 1990s and early 2000s.

Origin and status

The Dominion of Melchizedek was unilaterally declared in 1990 by U.S. citizen Mark Pedley, possibly with his father, David Pedley.[1] Mark Pedley also uses a number of pseudonyms, including "Tzemach Ben David Netzer Korem" and "Branch Vinedresser". It borrows its name from the biblical king and priest Melchizedek.[2]

When created, the DoM first laid claim to the Colombian island of Malpelo, a small island 300 miles off the Pacific coast of Colombia.[3] Later, it invented the Karitane Shoal in the South Pacific,[4][5] which is supposedly completely submerged for part of the day;[6]:105[7] Clipperton Island, an overseas possession of France which lies 1,500 miles west of Nicaragua; and Taongi, otherwise known as Bokak Atoll, an uninhabited Micronesian atoll falling under the administration of the Government of the Marshall Islands.[6]:105 Representatives of the DoM were banned from entering the island of Rotuma after their involvement with dissident groups seeking to secede from Fiji,[8][6]:113 with whom they had signed agreements to lease land on the islands of Rotuma and its neighbour Solkope.[9] It also claims the portion of Antarctica unclaimed by sovereign states, from 90 degrees to 150 degrees west,[10] known as Marie Byrd Land.

It has been described as "non-existent" by the U.S. Securities and Exchange Commission,[11] and as a "non-recognised sovereignty" by the U.S. Office of the Comptroller of the Currency.[2][12] It appears on an EU list of fantasy passports issued by private individuals or organisations.[13] Media reports have described it as a "virtual country",[2] as a "ruse",[3] and as a "phony country".[14]

Marshall Islands statement

In response to one of DoM's territorial claims, the government of the Republic of the Marshall Islands issued the following statement:

The Government of the Republic of the Marshall Islands condemns the claims and activities asserted by representatives of the "Kingdom of EnenKio" and the "Dominion of Melchizedek". The representatives making claims of separate sovereignty are not citizens of the Republic of the Marshall Islands and have no right to make claims on behalf of Marshallese landowners. Furthermore, these representatives are making fraudulent assertions that violate the Republic of the Marshall Islands's constitution. The area of land and ocean which the "Kingdom of EnenKio" asserts as a sovereign nation separate from the Marshall Islands and the area of land and ocean which the "Dominion of Melchizedek" is asserting control over are areas within the geographical and political boundaries of the Republic of the Marshall Islands.

Claims of recognition

On the DoM's official website, they claim a number of nations have recognized their sovereignty, with links to supporting documents.[15] Upon closer examination, a number of these are merely correspondence acknowledging various requests made of these established states,[16][17] or appear to be responses to offers of financial support.[18] Of the entire list, only one appears to be actual verifiable recognition: from the Central African Republic.[19][3] According to The Washington Post , the Central African Republic extended diplomatic recognition to the DoM in 1993, but the Post article went on to remark, "you get the feeling that the Central African Republic would recognize the State of Denial if it had a letterhead."[3] An article in the Quatloos!, online anti-fraud site, noted that "Melchizedek has apparently obtained some sort of recognition from some smaller states ... all of which are notable for their corruption. Claims that the DoM has received recognition from any major government are purely lies."[1]

Frauds linked to the Dominion of Melchizedek

Soon after its inception, the DoM started selling documents purporting to charter or licence companies.[20] By the end of the 1990s, the DoM claimed that some 300 banking licenses had been sold.[6]:113[21] DoM apologists have suggested that there is no link between Melchizedek and the illegal activities conducted by "banks" it has "licensed";[2] however, John Shockey, a former special assistant in the office of the U.S. Comptroller of the Currency, has stated:

Melchizedek first came to my attention in June 1990, a few months after Mark Pedley was paroled from a 1986 conviction. Inquiries were received concerning bank names: Banco de Asia, Guardian Savings & Guaranty and Express Bank among others. Investigations that these entities had bank charters from the DOM and obtained through an entity named Consortium Finance Corporation headquartered in Lake Tahoe, California. Further investigation disclosed a principal alternately named John Hayden and Branch Vinedresser. Shortly thereafter the FBI took Branch Vinedresser into custody and revealed that he was Mark Pedley, who then was charged with violations of his parole.[1]

In the same address Stockey also stated that: "The Dominion of Melchizedek is a fraud, a major fraud, and not a legitimate sovereign entity. Persons associated with the Dominion of Melchizedek have been indicted and convicted of a variety of crimes."[1]

In 1991, in Washington, D.C, shell banks that were subsidiaries of a Melchizedekian company tried to secure loans from real banks based on fake DoM securities, but were closed down before they succeeded. One of the men involved, Steve Peterson, later pleaded guilty to fraud and theft charges in another case in Arizona after using a company chartered in DoM.[20]

In Hong Kong, Gerhard Bacher used cheques issued by phoney Melchizedek banks to open accounts in legitimate Hong Kong banks;[2][20] he was sentenced to 6 months in prison.[20] In 1995, in the UK, an organisation that was making use of a DoM licensed bank was barred from doing business.[20]

A so-called "60/40 Investment Programme" offered by Credit Bank International, run by Roger Rosemont and registered in the DoM, was a Ponzi scheme that convinced at least 1,400 people to invest over $4,000,000.[2][6]:114

Companies with links to the DoM have been used in insurance fraud schemes. In Texas in 1996, after pleading guilty to insurance fraud, Jeffrey Reynolds was sentenced to 52 months in prison and ordered to repay $475,802 in premiums he had collected for bogus insurance policies.[22] The companies he was using had been licensed in the DoM.[22][6]:106 Later in the same year, and also in Texas, Leon Hooten's New Zealand-registered companies were prevented from selling insurance when they were found to be capitalised with worthless assets issued by the DoM.[23][24]

One of the most notorious victims of the scam was businessman Rogério Cavaco Silva, brother of former President of Portugal Aníbal Cavaco Silva, who in 1996 was conned out of US$35,000 which were supposed to guarantee a loan to complete a hotel in the Algarve.[25][26][27][28] Six Portuguese perpetrators, who conned a total of 39 businesspeople (including Cavaco Silva) between 1996 and 1999, were sentenced in 2007 to several periods in prison, the longest of which was six years.[29]

The DoM has also been involved in selling passports widely regarded as fraudulent, misrepresenting them as internationally recognised. In 1998, three individuals purporting to be officials of the DoM were arrested in the Philippines. The ringleader, John Gillespie, an Australian felon who was involved in the Fine Cotton horse substitution scam, eluded capture. The passport scam grossed an estimated US$1,000,000 from hundreds of individuals, with some paying up to $3,500 for these documents.[2]

Across all the purported schemes DoM has been accused of involvement in, one source estimates that the total value of funds raised may exceed US$500 million.[30]

Principal figures

David Evan Pedley

After being convicted of several financial crimes in the 1970s, including stock fraud, David Pedley was incarcerated. He claims the charges were false and the result of a "witch-hunt" against him. While incarcerated, he started a cattle business, which his son Mark operated for him in Los Angeles , California .[31]

While in Mexican custody Pedley apparently died, though the circumstances are not clear. A closed casket funeral was held in Altadena, California in 1987. At the funeral, FBI agents approached the Pedley family and requested to fingerprint David Pedley's body. This request was denied by the family and allegedly some government regulators believe that Pedley is still alive.[2] Pedley is the co-author, with his son, of the Melchizedek Bible.[7]

Mark Logan Pedley

Mark Logan Pedley (born 19 July 1953),[3] later changed to Mark Wellington[14] and also known as "Tzemach Ben David Netzer Korem" and "Branch Vinedresser" (a translation of his Hebrew name Tzemach Korem),[6]:111–2 is the son of David Pedley and was the Head of the House of Elders, Vice President, and Chief Justice of the Supreme Court of the DoM.[6]:111-2 Pedley is the co-author, with his father, of the Melchizedek Bible.[7]

In 1983, Pedley was convicted of mail and interstate fraud relating to a land fraud in California and jailed for three years. Shortly after his release, he was again successfully prosecuted in 1986 for a $6 million currency fraud scheme that was operated in 1982–83; he was jailed for eight years and fined $25,000. Having been paroled in 1990, he set up the Dominion of Melchizedek. His parole was revoked in late 1991 due to a violation of his conditions, arising from his promotion of a fictitious country, and was returned to prison to serve the remainder of his sentence.[14] In 1994, following his release, Pedley married Pearlasia Gamboa, who was made president of Melchizedek.[1]

In 2010, under the name Tzemach David Netzer Korem, he was charged with, and later pleaded guilty to, share manipulation regarding ZNext Mining. ZNext Mining was investigated by a multi-agency taskforce as part of Operation Broken Trust, a US-wide operation in 2010 that targeted investment fraud.[32] In 2011 he was sentenced to two years in prison;[14] he was released in 2012.[33]

Pearlasia Gamboa

Pearlasia Gamboa was president of the Dominion of Melchizedek.[3] She is married to Mark Pedley.[6]:112

She is a Filipino-American businesswoman who has been involved in controversial banking and investments. She was prevented from operating companies that were purporting to be banks in Indiana [34] and California.[35] The U.S. Securities and Exchange Commission sued Gamboa in 2009, alleging that she had used fictitious reports of gold mining operations to profit by fraudulently selling shares, siphoning off more than $1 million.[36][37] A judgment was ordered against her in August 2010 totaling $1.8 million; a $650,000 fine for the ZNext corporation, and $1.18 million for Gamboa personally. Gamboa was also permanently barred from selling penny stocks. As of 2011 she had still not paid the fine and was attempting to have the decision overturned.[7]

See also

  • List of micronations

References

  1. ↑ 1.0 1.1 1.2 1.3 1.4 "Dominion of Melchizedek". Quatloos!. http://www.quatloos.com/groups/melchiz.htm. 
  2. ↑ 2.0 2.1 2.2 2.3 2.4 2.5 2.6 2.7 "Cyberfraud: The fictitious "Dominion of Melchizedek"". The Nation (Thailand). 30 May 1999. http://www.asiapacificms.com/articles/cyberfraud_melchizedek/. 
  3. ↑ 3.0 3.1 3.2 3.3 3.4 3.5 "The Ruse That Roared". The Washington Post. 5 November 1995. 
  4. ↑ Michael J Field (1 March 2000). "Ignorance fuels Internet nation scams". Pacific Islands Monthly 70 (3): p. 37. https://nla.gov.au/nla.obj-352883424/view?sectionId=nla.obj-354539752&partId=nla.obj-352897168#page/n36/mode/1up. Retrieved 2 March 2021. "Karitane is a fiction created by another web state, the "Dominion of Melchizedek"." 
  5. ↑ Michael Field (4 February 2000). "PACIFIC CARPETBAGGERS AND CON MEN HIT CYBERSPACE WITH NEW NATIONS". Pacific Islands Report. http://www.pireport.org/articles/2000/02/04/pacific-carpetbaggers-and-con-men-hit-cyberspace-new-nations. Retrieved 2 March 2021. "Karitane is the invention of the "ecclesiastical and constitutional sovereignty" of the "Dominion of Melchizedek" (DOM), which says the atoll is in French Polynesia." 
  6. ↑ 6.0 6.1 6.2 6.3 6.4 6.5 6.6 6.7 6.8 Tillman, Robert (2002). Global Pirates: Fraud in the Offshore Insurance Industry. Northeastern University Press. ISBN 9781555535056. https://books.google.com/books?id=Rf_mHK98RNwC&pg=PA105. 
  7. ↑ 7.0 7.1 7.2 7.3 "Fantasy Island: The Strange Tale of Alleged Fraudster Pearlasia Gamboa". SF Weekly. 6 July 2011. Archived from the original on November 23, 2014. https://web.archive.org/web/20141123233507/http://www.sfweekly.com/sanfrancisco/fantasy-island-the-strange-tale-of-alleged-fraudster-pearlasia-gamboa/Content?oid=2182093. 
  8. ↑ Michael J Field (1 March 2000). "Bogus cyber nation helps Islanders seek Independence". Pacific Islands Monthly 70 (3): p. 36. https://nla.gov.au/nla.obj-352883424/view?sectionId=nla.obj-354539718&partId=nla.obj-352897035#page/n35/mode/1up. Retrieved 2 March 2021. 
  9. ↑ "State v Riogi [2001 FJHC 61; Haa0060j.2001s"]. High Court of Fiji. 20 August 2001. http://www.paclii.org/cgi-bin/sinodisp/fj/cases/FJHC/2001/61.html?stem=&synonyms=&query=apao. 
  10. ↑ "Scam Without A Country". Dallas Observer: p. 2. 2 May 1996. http://www.dallasobserver.com/1996-05-02/news/scam-without-a-country. 
  11. ↑ "Litigation Release No. 16368". U.S. Securities and Exchange Commission. 23 November 1999. https://www.sec.gov/litigation/litreleases/lr16368.htm. 
  12. ↑ "Caribbean Bank of Commerce Ltd. (Melchizedek)". Office of the Comptroller of the Currency. 13 November 1998. Archived from the original on February 18, 2007. https://web.archive.org/web/20070218043311/http://www.occ.treas.gov/ftp/Alert/98-38.txt. 
  13. ↑ "INFORMATION CONCERNING THE NON-EXHAUSTIVE LIST OF KNOWN FANTASY AND CAMOUFLAGE PASSPORTS". Directorate-General for Migration and Home Affairs. 20 February 2015. http://ec.europa.eu/dgs/home-affairs/what-we-do/policies/borders-and-visas/document-security/docs/list_of_known_fantasy_and_camouflage_passports_en.pdf. 
  14. ↑ 14.0 14.1 14.2 14.3 "Boy, Do We Know Tzemach Ben David Netzer Korem". Forbes. 8 October 2010. Archived from the original on November 27, 2014. https://web.archive.org/web/20141127213846/http://www.forbes.com/sites/williampbarrett/2010/10/08/boy-do-we-know-tzemach-ben-david-netzer-korem/. 
  15. ↑ "International Recognition". Official Dominion of Melchizidek website. April 2015. https://www.melchizedek.com/international-recognition/. 
  16. ↑ "Grenada PDF". Official Dominion of Melchizidek website. 2018. https://www.melchizedek.com/wp-content/uploads/2015/04/DoM-Grenada011.pdf. 
  17. ↑ "Netherlands PDF". Official Dominion of Melchizidek website. April 2015. https://www.melchizedek.com/wp-content/uploads/2015/04/DoM-Nederlands-Copy.pdf. 
  18. ↑ "Philippines PDF". Official Dominion of Melchizidek website. April 2015. https://www.melchizedek.com/wp-content/uploads/2015/04/DoM-Philippines-Copy.pdf. 
  19. ↑ "TPR with Central African Republic". Official Dominion of Melchizidek website. April 2015. https://www.melchizedek.com/wp-content/uploads/2015/04/TPR-With-Central-African-Republic.pdf. 
  20. ↑ 20.0 20.1 20.2 20.3 20.4 "Scam Without A Country". Dallas Observer: p. 3. 2 May 1996. http://www.dallasobserver.com/1996-05-02/news/scam-without-a-country. 
  21. ↑ "A 'Nation' in Cyberspace Draws Fire From Authorities". The Wall Street Journal. 9 Feb 1999. https://www.wsj.com/articles/SB918510801235641000. 
  22. ↑ 22.0 22.1 "No man is an island". Dallas Observer. 27 June 1996. http://www.dallasobserver.com/1996-06-27/news/no-man-is-an-island/full. 
  23. ↑ "Texas Halts Allegedly Fraudulent Bond Operation". PropertyCasualty360. 14 October 1996. http://www.propertycasualty360.com/1996/10/14/texas-halts-allegedly-fraudulent-bond-operation. 
  24. ↑ "INSURER OVERHAULS CAPITAL AFTER LOSSES ON INVESTMENTS". Business Insurance. 5 Jan 1997. http://www.businessinsurance.com/article/19970105/ISSUE01/10006890. 
  25. ↑ "Tribunal da Relação anula julgamento de burla com empresas 'off-shore'" (in Portuguese). Público. Lusa (Lisbon). October 27, 2002. https://www.publico.pt/2002/10/27/economia/noticia/tribunal-da-relacao-anula-julgamento-de-burla-com-empresas-offshore-192327. 
  26. ↑ Gomes, Adelino (November 14, 2005). "Burla que vitimou irmão de Cavaco Silva regressa hoje a tribunal" (in Portuguese). Público (Lisbon). https://www.publico.pt/2005/11/14/local/noticia/burla-que-vitimou-irmao-de-cavaco-silva-regressa-hoje-a-tribunal-1238709. 
  27. ↑ "Burlaram 50 em 5 milhões" (in Portuguese). Correio da Manhã (Lisbon). May 5, 2006. https://www.cmjornal.pt/cm-ao-minuto/detalhe/burlaram-50-em-5-milhoes. 
  28. ↑ "Só quero ver se recebo o meu dinheiro" (in Portuguese). Região da Nazaré (Nazaré). May 22, 2006. http://regiaodanazare.com/JournalNews/JournalNewsDetail.aspx?news=3c6204c6-c431-4dd2-9398-4c310afc9c7c. 
  29. ↑ "Penas agravadas com recursos à vista" (in Portuguese). Oeste Digital (Caldas da Rainha). February 15, 2007. https://oesteglobal.com/JOURNALNEWS/Penas_agravadas_com_recursos_a_vista. 
  30. ↑ "The Dominion Of Melchizedek Manipulation" (in English). IndyMedia (England). January 16, 2008. https://www.indymedia.org.uk/en/regions/world/2008/01/389561.html?c=on. 
  31. ↑ David Pasztor (1996-05-02). "Scam Without A Country". Dallas Observer (Village Voice Media). Archived from the original on March 7, 2008. https://web.archive.org/web/20080307050942/http://www.dallasobserver.com/1996-05-02/news/scam-without-a-country/full. 
  32. ↑ "U.S. ATTORNEY ANNOUNCES REGIONAL RESULTS OF 'OPERATION BROKEN TRUST' TARGETING INVESTMENT FRAUD". United States Department of Justice. 6 December 2010. Archived from the original on January 21, 2011. https://web.archive.org/web/20110121035733/http://www.justice.gov/usao/fls/PressReleases/101206-02.html. 
  33. ↑ "Find an inmate". Federal Bureau of Prisons. BOP Register Number 76523-012. http://www.bop.gov/inmateloc/. 
  34. ↑ "Indiana trying to expel 'phantom' Asia Pacific Bank". The Indianapolis Star: p. E1. 9 November 1994. https://pqasb.pqarchiver.com/indystar/doc/240110761.html?FMT=ABS&FMTS=ABS:FT&type=current. 
  35. ↑ "'Nation' Waging 'Spiritual War' on State Official". The Sacramento Bee. 13 February 1995. p. B1. http://nl.newsbank.com/nl-search/we/Archives?p_product=SB&p_theme=sb&p_action=search&p_maxdocs=200&p_topdoc=1&p_text_direct-0=0EB0DB1978FC04F6&p_field_direct-0=document_id&p_perpage=10&p_sort=YMD_date:D&s_trackval=GooglePM#ixzz1HKfqBQGC. 
  36. ↑ "SEC Ties Gold-Mining Shares to Empty Shell". Courthouse News Service. 15 Jun 2009. Archived from the original on March 19, 2012. https://web.archive.org/web/20120319023958/http://www.courthousenews.com/2009/06/15/SEC_Ties_Gold-Mining_Shares_to_Empty_Shell.htm. 
  37. ↑ "SEC Sues ZNext Mining and its Principal for Fraud and Registration Violations". U.S. Securities and Exchange Commission. 12 June 2009. Archived from the original on June 15, 2009. https://web.archive.org/web/20090615063145/http://www.sec.gov/litigation/litreleases/2009/lr21084.htm. 

External links



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