WITH GUILE AND GALL, THIS MAN GULLED HAWAII

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-01208R000100170003-2
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: December 22, 2016
• Document Release Date: March 2, 2011
• Sequence Number: 3
• Publication Date: December 1, 1983
• Content Type: OPEN SOURCE

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Sanitized Copy Approved for Release 2011/03/02 :CIA-RDP90-012088000100170003-2
ARTICLE APPEARED MONEY MAGAZINE
ON PAGE ~a~ December 1983
by Marlys Harris
.N .,,.~,,,,,a ,,,,,,",~,;..,,,~ ~-,~~~na.~~m Some 300 trustin
along with?interest paid out of funds obtained - g
from newcomers to the deception. But Re:wald`a ~ investors lost $ ~ 2
was a particularly stunning exarnpie.'.:not : million In o stunning.
" ~ so much in tcrrrts of the money involved .as .
n the evening of Friday,luly 29.1983,
Ronald Ray Rewald, 41, chairman of
the Honolulu investment firm 8f
Bishop Baldwin Rewald Dillingham & Wong,
checked into the Sheraton Hotel on Waikiki't;
tourist-packed main drag. At four o'clock the
next afternoon, in a rouune inspection of
rooms, the assistant manager found Rewald ly-
ing in?a pool of blood. Using a razor blade,~-e
had slashed deep intohis wrists and left forearm .
in an unsuccasTul attempt to killhittuelL .
His near suicide followed alocal -television
news report contending that. Rewald .was not . .
the successful and upstanding businessman he
claimed to bc. This combination of evenu was
one of the biggest bombs to hit Honolulu since
Pearl Harbor. Several hundred people-celeb-
ritia, prominent businessmen and top-ranking ?
military men, as well asmiddle-income families
and even widows of modest means=ttad a total
of S 12 million invested with the firm.
i
During the next week. investors frantically
pounded at the locked doors of Reward's im- ~
pressive 26th-floor offices in Honolulu to de?
mand their money. Letters from troubled clients
?on the mainland began pouring in too: But
Bishop Baldwin's doors were locked for good. I
?On Friday, Thomas E. Hayes, whom the coup..
had appoimed interim bankruptcy trustee. gave
investors the bad news: he had found no evi- i .
dente that Bishop Baldwin "owns or holds any
assets ...that begin to equal the amount of in-
vestments outstanding."
Ultimately, a federal coup would?assert that
Ronald Rewald had opcratod a Ponzi scheme-~
the timeworn scam in which >= promoter pock- .{
in his sheer gall and the depth of his victims'"? eXOmple Of O POnZI
~
trustfulness. ~ ~
.
How did so many people-often college edu-
cared, wdl connected, sopnisucatea-succumb
to such a swindle? By taking Rewald on faith
and his firm at f gee value. They asked no ques?
lions, or if they did, tney heard the answers they
wanted to hear. What's more-and it's hard to
blame them for this-they put their confidence
in people and institutions that were supposed to
guard their interests: lawyer and financial plan-
ners, who had referred them to Bishop Baldwin,
the Securities and Exchange Commission,.the
Internal Revenue Service and other govern-
ment agencies. Many clients became unwitting
accomplices, recommending Rewald to -col-
leagues and acquaintances. Nobody ever
checked Reward's background-not even, it ap-.
pears. the master checkers at the Central Intelli-
gence Agency, with whom Ronald Rewald says
he.was deeply involved. ~ .~
Reward's firm had inspiretl trust. The names
::Bishop. Baldwin and Dillingham were those of
kamaaina families=the 19th-eenCury,pioneers
,in Hawaii who had built .large fortunes and
.whose names still enjoy considerable influence
` in the Islands. Reward's firm claimed to have 24
:"consultants," many of tht:m lawyers, accoun?
rants and insurance specialists. In addition to
the investment accounts that it managed, the
firm.offcred individuals and businesses a wide
range of services,-from "Estate Coordination"
to "Psychiatric Evaluation of Personnel." A ?.
network of Bishop Baldwin ol5ces spanned the
globe from London to Tahiti, where the c~nt~
pany supposedly eritenained clients on a dou-
ble-hutted canoe.
scheme. When the
scondp) broke, it
erupted over the ls?
~lorids like Kilauea.
8lshop Be/dw/n brotburos
des~rlbsd worldwlds ei-
11ces. In lehltl, d1eMS sup- .
posed/y wero enteNolnsd
? on o double-~h~11sd tonne.
t ..
?-?! Sanitized Copy Approved for Release 2011/03/02 :CIA-RDP90-012088000100170003-2