To Live and Crash in L.A.

The Enzo was cut in half by the phone pole
At 6 a.m. on Friday 21 this year, Malibu police Sergeant Phil Brooks answered what he thought was a routine call about a car crash on the Pacific Coast Highway. It would turn out to be anything but.

The script for this accident reads like “Mission Impossible”: A car race between two stolen, foreign- registered, million-dollar cars ends at 162 mph, when one is cut in half by a phone pole.

Unhurt in the crash is a fugitive financier who claims someone else was driving. He’s interviewed by mysterious “Homeland Security” officers, and the police trail uncovers millions in missing money, unregistered weapons, illegal drugs, and a “lost” yacht with other suspects aboard. The Internet has been buzzing ever since, and no West Coast cocktail party is complete without the subject being discussed.

ENZO IN TWO PIECES

At the crash site, Sergeant Brooks discovered a red 2005 Ferrari Enzo broken into two pieces immediately behind the passenger compartment – and the pieces were 600 feet apart. A concrete power pole was broken in two, with the bottom half lying on the ground and the upper half dangling from its wiring, which caused a power outage in the surrounding area. The Enzo’s engine and other pieces were scattered along the road for 1,200 feet. Standing in the middle of the wreckage were Bo Stefan Eriksson and Trevor Karney.

Eriksson identified himself as a 44-year-old Swedish national and the owner of the Enzo. He said he was a passenger in the Enzo when the crash occurred. The driver was a German acquaintance named Dietrich (last name unknown), who fled the scene. Eriksson claimed that Dietrich had been racing a Mercedes SLR McLaren when he crashed. A breathalyzer test determined that Eriksson’s blood alcohol level was above the legal limit. Karney said he was the passenger in the Mercedes, and corroborated Eriksson’s story.

HOMELAND SECURITY?

A few minutes later, two men arrived and flashed badges, identifying themselves as officers from Homeland Security. They demanded to speak privately with Eriksson, and did so at length.

The police let Eriksson and Karney go. They called in a helicopter and a search-and-rescue team to search for “Dietrich,” but gave up after three hours.

Further investigation uncovered a web of international intrigue.

Dietrich evaporated once police noticed that both airbags had deployed, but found blood only on the driver-side airbag. A DNA test proved that it was Eriksson’s blood, and
he then admitted that Dietrich did not exist.

199 MPH WHEN THE TAPE STOPPED

Accident reconstruction determined the Enzo was traveling 162 mph when it became airborne and hit the power pole. Later, an anonymous witness told the police that Karney was the passenger in the Enzo, and had a video camera. The witness claimed he had seen the video, which showed the speedometer registering 199 mph just before the tape stopped. He said Karney still had the video. The police went to Karney’s address (a yacht moored at an exclusive marina), but the ship had sailed. It turned out to be registered to a Carl Freer. Freer, Karney, and the video remain missing.

Police discovered that the Enzo was owned by a Scottish bank and leased to Gizmondo Europe Ltd, a London-based company, of which Eriksson was an executive. Further research turned up a second Enzo-a black one-and a Mercedes SLR McLaren which also belonged to banks who had leased them Gizmondo. The leases forbade the cars from being taken out of Great Britain, yet Eriksson had somehow managed to bring all three to the U.S.

None of the cars were registered for road use in the U.S., as Eriksson stated that they were only to be used for shows and off-road use. Nonetheless, many witnesses reported Eriksson caused quite a stir around normally blasé Los Angeles with his pair of Enzos.

The banks said payments on the leases stopped a few months after the cars came to the U.S. and have reported the cars stolen. The banks claim to be owed $1.15 million, including $566,000 on the wrecked Enzo.

GIZMONDO GOES WRONGO

Eriksson has a storied past and many run-ins with the law. His first theft conviction netted him three months in jail, followed by another three and a half years for cocaine and arms-related convictions. Finally, he was convicted of fraud and counterfeiting and sentenced to ten years, but released after about five. In 2000, while working as a debt collector, he was assigned to find another Swede, Carl Freer, who had failed to deliver Ferraris to Sweden. The assignment developed into a friendship and the two formed Gizmondo to develop handheld video game systems to challenge Sony and Nintendo.

To raise capital, Eriksson, Freer and several others acquired Floor Decor, Inc., a virtually defunct carpet retailer that had one significant asset-it was listed on the NASDAQ exchange. The name was changed to Tiger Telematics, and became the parent of Gizmondo Europe. The pair started raising cash by selling Tiger Telematics shares.

But Gizmondo couldn’t sell many video game systems. Critics complained that they were more expensive than the competition, had numerous technological features of questionable utility, were rather ugly, and lacked one major element-games that could be played on them. Nonetheless, Gizmondo burned through an enormous amount of money, losing $263 million in its final year.

$1,500 LAP DANCERS

Among the questionable expenditures: over $3.1 million in annual salary and bonuses for Eriksson, and over $3.4 million for Freer; over $500,000 in salary, bonuses, and automobile allowances for another executive’s girlfriend, who worked for Gizmondo as a secretary; unspecified high consulting fees for Freer’s wife; $1,500 lap dancers; company sponsorship of a Ferrari raced by Eriksson at Le Mans; $15 million in homes; a $10 million yacht; and millions in cars, diamonds, and other incidentals for executives.

Seeking a change of scenery, Eriksson, Freer, their wives, two Enzos, and a Mercedes left England and injected themselves into the L.A. social scene with a big splash. Then a Swedish newspaper ran a story connecting Eriksson and Gizmondo and described his criminal past. Eriksson and Freer both resigned, and a few months later, Gizmondo filed for bankruptcy, listing debts in excess of $200 million.

GLOCK AMMO UNDER THE SEAT

At the crash scene, Karney approached a motorist who had stopped to help and asked if he could borrow a cell phone. The motorist let Karney sit in his car to make the call, then later noticed a loaded Glock handgun magazine under his seat.

At the same time, Eriksson identified himself to police as the Deputy Commissioner of the anti-terrorism unit of the San Gabriel Valley Transit Authority police department. Intrigued, police investigated the transit authority and discovered it is a non-profit agency founded by Yosuf Maiwandi which owns a “fleet” of five small buses used to provide transportation for disabled and elderly people.

The transit authority’s main place of business was Homer’s Auto Service, but it maintained its own police department, staffed by six volunteer officers. Eriksson was helping create a security system for the buses. You may wonder why such an agency would need a police force at all, but Maiwandi claims the police department was created to provide protection for riders and to run background checks on bus drivers.

Unimpressed, police raided the transit authority’s offices and seized numerous documents, five firearms, police jackets, and many police badges. They also arrested Maiwandi on charges of perjury.

A further raid of Eriksson’s Bel Air mansion netted several computers, a substance believed to be cocaine, and a .357 magnum Smith & Wesson that was registered to a businessman who served on the Orange County Sheriff’s Advisory Committee as well as being a deputy in its services division. The sheriff has been criticized for giving deputy badges and concealed weapons permits to volunteers with no police training. Detectives are still wondering why the gun was at Eriksson’s home.

CHARGES AND STILL MORE CHARGES

Eriksson was charged with embezzlement, grand theft, drunk driving, cocaine possession, and unlawful possession of a handgun. He faces 14 years in jail. He is in prison, unable to post bail because his assets are frozen. With the help of a dui law expert, Eriksson pleaded not guilty to all counts and insists that he was in negotiations to pay off his banks when the crash occurred.

Charges against Eriksson were later expanded to include hit and run, driving without a license, and driving without insurance. Police say that on another occasion, Eriksson was driving a Porsche Cayenne when he rear-ended a Ford explorer, then drove off. Police say he did not own the Cayenne, but did not elaborate as to how he came to be driving it.

Eriksson’s associate, Carl Freer, was arrested and charged with perjury, impersonating a police officer in order to purchase a gun, and unlawful possession of a weapon. Police confiscated 12 rifles and four handguns from his home and yacht.

Then Eriksson’s wife was pulled over while driving the SLR. She was cited for driving without a valid driver’s license. The SLR was confiscated because it was unregistered, carried British license plates, was illegally exported from Great Britain, and had been reported stolen by the bank that owned it.

NOT GOING ANYWHERE SOON

Eriksson’s trial is scheduled to begin July 31. However, many motions have been filed by his attorneys, and that date is likely to change.

U.S. Immigration and Customs enforcement continues to investigate how Eriksson and the cars got into the country and have placed an immigration hold on him, so that they can arrest him if he is released from jail. A spokeswoman stated, “He is potentially subject to deportation.” Scotland Yard is also investigating.

Karney and Freer’s yacht is believed to be sailing to Ireland, but has not been located. The Malibu Sheriff’s Department is looking for the two “Homeland Security” agents, eager to question them.

Press and Internet buzz reflects amazement about the safety features of the Enzo. Many bloggers are amazed that Eriksson and Karney survived such a horrific crash without any injuries other than Eriksson’s cut lip. A police officer at the scene was quoted with practically British understatment: “For a million dollars, you get a pretty good air bag system.”

Ferraristi around the world are reported to be severely depressed about the sacrilegious loss of one of the 400 Enzos built by Ferrari. One fan even lit a rosary candle at the scene and tacked a picture of the Enzo to a cross. (“Get a life” might be an appropriate response here.) And summing up neatly, Malibu Mayor Andy Stern suggests this case should serve as a warning to sports car drivers not to speed on Pacific Highway. Especially if they have a lot to lose.

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JOHN DRANEAS is an attorney and car collector in Oregon. His comments are general in nature and no substitute for a consultation with an attorney (especially in this case). He can be reached at legalfiles@sportcarmarket.com. Your comments on this column are welcome and should be sent to the above email address.