Daniel Evans (aka David Harlow) is a conman. Ormita is a fraud.
These are the findings in The Ormita Report, the definitive statement on the Ormita fraud that falsely claims to have a quarter of a million members in dozens of countries and 3.4 billion dollars of annual trade. In fact, Ormita is little more than a one-man-band using smoke and mirrors to dupe investors around the globe.
Releasing on 26 March 2014, my report is over 200 pages and contains 60,000 words of facts, evidence and commentary following a major private investigation commenced in Q4, 2013.
THE ORIGINAL POST (Warning about XO, Ozone & Ormita) that became the number one hit page on this website:
I have had extensive dealings with this network of companies, and am aware of many of their various interactions; quite a bit not publicly known. This afternoon I have become aware of developments in the disputes with the above companies that now give me enough cause to alert people to the following facts. My personal commentary on the situation follows.
- XO Ltd (the provider of the core software) is in dispute with the IRD with very large transactions relating to Ozone. I have seen enough to believe that large fraud has occurred but am not a forensic accountant nor lawyer, so I speak this as a lay personal opinion, conditional on a full hearing
- There have been questions asked in regards to payment of the original license that Ozone secured from XO (via Sebby Woodhouse). Again I have seen and heard enough to be very interested in the answers to the questions: “Who bought what and what did they pay for it? Was the second transaction valid (i.e. undisputed, fully paid)? If they weren’t completed correctly or if the account has not been conducted in accordance with XO rules where does that leave the Ozone license?”
- I have observed changes to the Barterzone website this afternoon where the link to “Browse Member Directory” (an ASPX system) has changed from Ozone member directory to a PHP system (http://ozone.net.nz/XOB2B07/Home3/Login.aspx?url=Browse/Buy.aspx –> http://barterzone.co.nz/members/login.php). This indicates a major change – I would be asking what is happening behind the scenes. I think there is probably a lot more to this than a simple rebranding exercise.
- I am aware that parties have been attempting to serve both Daniel Evans and Miriam (director and former directors of Ormita) with documents but have been unsuccessful thus far. What are those documents and why can they not be served?
I would obviously encourage business people to exercise extreme caution when conducting business with these companies and would encourage people to ask direct questions of the principals and their representatives.
I think that the proverbial is getting quite close to the fan, and wouldn’t like to guess who is going to come out on top of this one.
There is a long history of “interesting” behaviour with the network of New Zealand and Australian companies associated with the Ozone brand and their principals. From 2008 to January 2009, I conducted 100 hours of personal research into the health of the company that I invested into which became more of an analysis of the conduct of Daniel Evans as director, and chief strategist, and head poncho. I found that all roads led to confusion, except in Daniel’s mind. I found him quite divisive and he oscillated between appearing to be a great open and honest businessman (some claim this is the consumate conman face to the man) and a fully demon-possessed maniac screaming profanities down the phone at me. It was an extraordinary experience which I blogged about at the time under the heading People in business.
I found him extremely good at manipulating people, when he used threats, bluff and what to me was excessive anger to attempt to control others – business people, staff and me. He had a group of loyal supporters that believed in him to the hilt in absolutely everything (even in the face of conflicting evidence and what was to me reason), but equally he had others out there who called him a crook, and worse and refused to see anything untoward as anything but deliberate fraud. He was also apparently behind an effort to undermine Go Kiwi Internet which I also blogged about then.
There was a litany of compliance issues in regards to his business dealings. Some were fairly serious and I still think that anyone who wants to dig will find a major hornets nest – if they are good and persistent I think that he could have some serious issues to sort out. Jail time is perfectly possible for some of what I saw. Daniel sees things differently of course, and hastened to rectify matters to get me and others off his back, claiming that they were just oversights and that “I know that some things might not be 100%”, and that I was part of a cartel out to get him.
I wrote a private 14,000 word report that I distributed to shareholders of that failed company that effectively advised them that I believed that any company Daniel was involved with would always struggle because of the people-relationship and interpersonal issues that Daniel struggled with. I think this pattern of a trail of destruction is continuing. The jury is out on whether this is just as a result of Daniel’s personal issues or whether there is a background of skullduggery but I don’t have any doubt as to what the truth is over the past. I’ve made up my mind. What’s happened since my report is however only heresay, because I am not actively researching the matters and actually don’t want to.
In regards to Ozone, I liked the exchange in the days that Daniel ran it. It had a vibrancy and energy common with any good startup as well as being the underdog. The exchange went backwards under Sebby’s watch and plateaued quite a bit with Patrick. I think it is a shame that there are legacy issues behind the scenes for the exchange. I’m not party to the inner workings of Ozone and I know full well how companies can legitimately buy and sell shares/assets and liabilities but I have questions as to the timing of the recent changes.
There are many other issues but any investigation has to start somewhere. I would encourage investigators to focus their research on the legitimacy and use of “rogue” Barter transactions and how this affects GST to the benefit of certain entities (in some multi-million dollar transactions), and the timing and circumstances of the transfer of shares in Ormita to and from Australia/NZ. Issues exist in my mind over the legitimacy of source code “sales” that enabled Daniel to effectively reproduce XO software after having been expelled as a director. These transactions have yet to be explained to my satisfaction and in time I think may come back to haunt Ormita and their offshoots. As I said there is a LOT more but others may follow it through.
I’ll update matters when or if I have more information that directly affects parties involved. In the meantime – be careful and ask lots of questions.
I have received the following written responses from Patrick Howard, Barterzone. Barterzone is a simple rebranding exercise, with balances transfered from Ozone to Barterzone, and trade exchange remaining in the same ownership. One thing I was impressed with is that Patrick is showing all the signs of a guy who’s onto it. It’s not often that you can talk to a guy who listens, and even more impressive is a restructuring of commission rates as a result of a phone chat. I believe that commissions chargeable/payable on sale is a far easier way to do business. Another trade exchange I was involved with a few years ago structured their commissions this way and it worked well. It’s better for the exchange, and the seller can budget the full amount of commissions at the point of sale. It is psychologically better as well, after all why would you want to charge people to spend/use something that is theirs anyway? If they don’t have the cash for the fees at the time they want to spend (and let’s face it most people are in trade exchanges because they are not cash-rich) it puts people off trading.
Given the rocky history of Ozone etc, a rebranding exercise makes good sense. If there have been problems with XO (and I know there have been) moving off the XO platform also makes sense. I’m sure that Patrick has done due diligence on stripping the asset of the exchange from the XO system onto his own. If I was XO I wouldn’t be too happy and I do know that the matter will raise its head somewhere sometime in the future. Things are certainly interesting sometimes in business but good on Patrick if he can make it work!
My take on it is that after investing into the software and the infrastructure as he has, Barterzone probably has a pretty good chance of making a go of it. The build-up phase of a trade exchange is always associated with excitement, rapid growth and lots of goodwill. If the energy and investment that Patrick has put in over the last year or so remains for a good 2-3 years, I think Bartercard may have a serious competitor to deal with in New Zealand – for the first time in the more than 20 years that I’ve worked in this area. The hard part will be to push through into years two, three and four, cementing strong relationships and building the credibility that is so important to this line of business.
RECEIVED 18 January 2010:
There have been questions asked in regards to payment of the original license that Ozone secured from XO (via Seeby Woodhouse). Again I have seen and heard enough to be very interested in the answers to the questions: “Who bought what and what did they pay for it? Was the second transaction valid (i.e. undisputed, fully paid)? If they weren’t completed correctly or if the account has not been conducted in accordance with XO rules where does that leave the Ozone license?”
In June 2007 I purchased the client base, goodwill and assets of Ozone from Seeby Woodhouse. I am not aware of the payment arrangements between Seeby and XO. My purchase from Seeby is subject to a confidentiality agreement. I have never signed any agreement with XO due to the terms and conditions of the agreement presented by XO being onerous to the point it would have been unprofitable to keep the exchange operating. I am happy to answer any ongoing questions by members of BarterZone (previously Ozone) provided they are not subject to confidentiality agreements.
I have observed changes to the BarterZone website this afternoon where the link to “Browse Member Directory” (an ASPX system) has changed from Ozone member directory to a PHP system (http://ozone.net.nz/XOB2B07/Home3/Login.aspx?url=Browse/Buy.aspx –> http://barterzone.co.nz/members/login.php). This indicates a major change – I would be asking what is happening behind the scenes. I think there is probably a lot more to this than a simple rebranding exercise.
The decision to move away from the XO platform was based on such things as:
– Having no signed agreement in place between XO and myself (due to the nature of the agreement offered by XO I was not prepared to sign this)
– Having been verbally told by XO that I have the exclusive use of the XO platform for New Zealand but finding out this is not the case. See http://nz.ormita.com/xob2b07/Home3/Login.aspx . From this link you will see that the XO platform that Ozone (now BarterZone) was using is in direct competition and the same platform as being used by Ormita. This creates a direct conflict of interest not only for current or potential new members but also for myself as the person responsible for the NZ exchange. It became apparent that there must be real serious issues within XO for another trade exchange operator to be a direct competitor to me AND using the exact same software platform. You will see at the bottom of the screen shot that it also says Software provided by XO Limited with a link to XO. So the question would have to be â€œwhat is going onâ€ . XO has had months to serve an injunction on Ormita to stop using the XO platform but either does not the legal right to do so or some other reason?
– So to answer the question, yes, BarterZone had concerns on a number of levels with using the XO platform. To ensure the future safety of the members of Ozone I made the decision to create our own state of the art platform trade exchange software which has come at a substantial cost. I am now proud that current and future trade exchange members have an exchange that not only is modern but also has full transactional online and offline facilities to assist both individuals and business owners to conserve cash in every transaction and be able to keep a record of this in an easy to use website.
– On the 21/10/2009 all members of Ozone were notified of the new platform and name change as per the email below. The promotion was a huge success with hundreds of new members joining.
I asked Patrick for clarification of the above (I wanted clarification of the phrases “name change” and “new members joining”) and received confirmation from Patrick on 21 January 2010 that it is in fact just a name change/rebranding exercise:
To confirm when the new BarterZone platform was launched all the members balances were transferred across being credits and debits. Therefore all member benefits have been retained.
On a side note, I have taken your advice on board and we are adopting a policy of only charging fees to the seller ( not the buyer). This is a major move for BarterZone and will work to the benefit of all members and the exchange overall.
Therefore the structure will look somewhat like this:
Joining Fee (FREE – for the personal and traders accounts)
Monthly Fees (FREE – for the personal and traders accounts)
Transaction Fees 6% to the seller only / Buyer Free
If this is for real, that’s a real competitor in the trade exchange marketplace at 6%. If Patrick can survive on 6% long-term (Ozone started at 1% for life and then changed the rules several times thereafter and conveniently “forgot” it’s initial promise to us all as greed and mismanagement took over) then Barterzone’s fee structure is very compelling. This is even better than the old-school top Bartercard traders (who negotiated a supposedly-secret-but-not-so-secret deal to pay only fees on sale only) who paid effectively 6.5%.
At 6%, I can see many traders switching their preferred currency from Bartercard to Barterzone. Once the momentum gets up, and the word gets around, things could get interesting. From Bartercard’s perspective I would find it hard to counter this one. With a new owner/software/brand that offers HALF the fee rate, the only thing they’ve really got is to hit their members with the risk of a new exchange, but put half the fees and painless entry on the table to a typical “trader” and Barterzone might be causing some hurt to Bartercard pretty soon.
I think this is a good move on Patrick’s part. What he’s doing is geting a better grip on the membership vs currency vs exchange thing. As a trader, barter of any sort offers me both a currency and a marketing opportunity. TradeMe is strong in marketing but just deals in cash. Bartercard, Ozone and others do offer me a mix of marketing and a currency.
The thing is that sometimes I may want marketing, but many times I just want a currency that I can use. Bartercard doesn’t “get” this distinction and is stuck on the Membership thing and thus the constant high fees and associated stress. Once I’ve had the introduction to another member, why on earth would I want to pay massive fees on subsequent trading? Barterzone’s 6% is still more than the Credit Card rates but only just and is therefore much more like a currency.
The next phase for Patrick and Barterzone, and he should be aware of this being involved in the Internet, is that you make a bigger business by branding and influencing, rather than owning and controlling. Google understood this and I presented this concept well under the Web Thought Leadership presentations. When Patrick can find a way to “monetise the currency” – i.e. zero fees and receive commercial benefit around the edges – THEN he will make a statement! We’ll all be using Barterzones rather than NZDs and USDs.
I’m doing this to some extent in Samoa with the local villagers where we provide food, clothing and other goods donated to us equal to a set “unit of measure” – six pounds of flour = a quarter of a day’s wages for a family, sort of thing. The currency doesn’t matter – it’s simply like a tool to do the job and we manage and provide the currency to leverage greater exposure, influence and profit. In the case of Samoa it more people involved and more tourism, but it could be one website = one fax machine = one day’s labour = [or whatever].
With the manipulation of the global monetary system by the central banking cartel, alternative currencies will become far more prevalent (and valuable) as thinking people wake up to how the global elite are playing with us. Patrick’s mid-term goal should be to get trade volume in the exchange and then he should aim get the fees right down to zero and monetise his business in other ways. This would cement his position as a Thought Leader (first trade exchange in the world to go “zero fees”) and removes the influencec of competition. At zero fees he can ask anything of me and I’ll join. Even at 6%, I’ll hold off because I can get what he offers in other ways without the 6% – but it is tempting!
Now for those of you who can’t get the idea of how to run or monetise a zero fees trade exchange, book your flight to Samoa and visit me – I’ll show you how to build a multimillion dollar resort in multiple villages, with no capital, in the middle of Tsunami Ground Zero for people who have nothing and yet give you everything! It’s an unfolding story – The Samoa Story, in fact.
On another note, I notice that Daniel has been effective in selling Ormita licences, and I continue to receive marketing info letting me know who their new staff members are. I shudder at the thought of more people getting their fingers burnt and their lives messed up but one can’t solve all the world’s problems despite my best efforts!
UPDATE Q1, 2012: I notice from a pingback that there are troubles within the ranks in the companies register. No doubt Ormita has a creative response up its sleeve. As with all posts I offer a full right-of-reply for explanations.