When Savvy’s ‘house of cards’ fell apart
An $800,000 taxpayer-funded loan was given to Savvy Entertainment just weeks after the company failed to stage a publicly advertised extreme watersports event in the Middle East owing to lack of funds.
An investigation by The Royal Gazette has discovered that some of the money which the Government handed to Savvy principals Anthony Blakey and Danilee Trott seven years ago for a music studio may have been used by them to pay for a similar event that did take place in Australia.
Gretchen Vance, who worked as a contracted event co-ordinator for Mr Blakey and Ms Trott, said she arrived in Queensland on March 31, 2018, ahead of the hydroflight contest on April 6, to be told the hotel bill was not paid.
She called Ms Trott who she said reassured that her a loan obtained by the company was due to clear, and that it would pay for hotel rooms and other expenses in the Gold Coast for competitors and judges.
The $800,000 loan from the Bermuda Government was paid into Savvy’s bank account on April 4, 2018.
Ms Vance, now an elected official in Texas, said she was “100 per cent” sure the company wired money to Australia once the loan cleared to pay the outstanding bill at the InterContinental Sanctuary Cove resort.
“I can tell you that $100,000 went to the Poseidon Games in Australia,” claimed Ms Vance, the mayor pro tem of the City of Lakeway. “It went on airfare, hotel, food.”
Records released by the Cabinet Office under public access to information show Savvy was pushing for a government grant to fit out the studio at Dockyard at the same time it was struggling to fund its international hydroflight contest, named the Poseidon Games World Tour.
The company also asked Butterfield Bank for an overdraft in late March 2018, according to the disclosure, stating that it was “quite urgent”. The request appears to have failed, despite the tourism ministry providing the bank with a letter confirming the Cabinet had approved a loan.
The comptroller at the economic development and tourism ministry told the Accountant-General on April 2, 2018, in response to questions, that the cost of the studio project was $1.2 million, and $400,000 was “being put up by Savvy themselves”.
The comptroller wrote that Savvy required the loan “ASAP” and that they “cannot stress the urgency of this payment”.
There is nothing in the released records showing the company had $400,000 to contribute and an April 5, 2018 e-mail from Randy Rochester, the tourism permanent secretary, reveals that Savvy was not asked to prove it was putting up those funds until the day after it received $800,000 from taxpayers.
Savvy’s serious financial troubles seem to have escaped those in government, including David Burt, the Premier and Minister of Finance, who was enthusiastic about giving the loan for the studio, according to the disclosed documents, as well as about a proposal for Savvy to “procure” celebrities to attend Cup Match.
Yet, Jamahl Simmons, then the Minister of Economic Development and Tourism, and Mr Rochester knew about the Poseidon Games. The disclosure shows that the minister met with Savvy to discuss the world tour in October 2017 and wrote a letter in support two months later.
Jamahl Simmons met with Savvy’s principals to discuss an ill-fated hydroflight “global event tour” almost six months before his ministry lent $800,000 to the pair for a music studio.
Records disclosed by the Cabinet Office under public access to information include an October 23, 2017 e-mail from Danilee Trott, Savvy’s chief operating officer, to Mr Simmons, who was the Minister of Economic Development and Tourism, thanking him for “meeting with us last week”.
She shared with him further details of plans for the Poseidon Games, which was supposed to visit five countries and have a trophy finale in Bermuda.
On December 14, 2017, the minister wrote to Savvy chief executive Anthony Blakey to “confirm the Bermuda Government’s support for the hosting of the 2018 Poseidon Games in Bermuda”.
He wrote: “As Bermuda continues to look at new streams of revenue as well as diversifying its tourism product, we believe this event encompasses both of these aspects. We therefore look forward to furthering our relationship with Savvy Entertainment and in particular, this hydroflight sporting event that is fast becoming a staple in the international arena.”
Sources in the industry, including equipment supplier Shaw Norris, told the Gazette that hydroflight, an extreme watersport, had a limited following and there was little money to be made from it.
Ms Trott told Mr Simmons in a January 16, 2018 e-mail that the first tour event, in the United Arab Emirates, was taking place in four weeks’ time.
It was cancelled a couple of weeks later because of lack of funds.
There is no record in the Pati disclosure of Mr Simmons asking civil servants to check on the event’s success before his ministry gave the loan for the studio on April 4, 2018 — although he did ask his permanent secretary on March 27, 2018: “What is the protection if the company goes under?”
The immediate reply didn’t answer his question, but other e-mails show discussions among civil servants about protections for the Government in the event of the loan being defaulted on.
Mr Simmons has previously apologised for his involvement and again said he was sorry in a February 13 statement sent to the Gazette.
“This matter is under police investigation,” he said.
“While I am not the subject of this investigation, it would be inappropriate for me to discuss any aspects of it while that process is ongoing.
“What I can say, however, is that throughout my tenure, decisions were made based on consultation with technical officers who provided their professional advice and recommendations.
“Their input was central to ensuring that due process was followed in all matters. As the then minister, however, I apologise.”
The PLP MP added: “The misappropriation of public funds is a serious issue and I fully support all efforts to ensure that the full weight of justice is served.”
The $800,000 studio loan has never been repaid and Mr Blakey, an American who claimed to be a former Sony songwriter, was charged in Magistrates’ Court, in his absence, with obtaining a money transfer by deception.
Prosecutors are still trying to extradite him from the United States to face trial, more than six years after he disappeared from Bermuda, and almost 2½ years after he was charged.
He told the Gazette in an e-mail on February 7 he had written a memoir to be released this year, but had no further comment.
Ms Trott, a Bermudian, was arrested but not charged with any crime. She now lives in Costa Rica, where she runs a life-coaching and wellness business, and could not be reached for comment.
The Gazette, which first revealed the existence of the Savvy loan to the public in July 2019, submitted Pati requests for records relating to the company to the tourism ministry and the Corporation of Hamilton, where Ms Trott worked for years as events manager.
Hundreds of pages were shared by City Hall in January last year, while the Cabinet Office released records in November, on the orders of the Information Commissioner.
The two sets of disclosures, along with Ms Vance’s recollections and those of a hydroflight equipment supplier, Shaw Norris, who worked at two Poseidon events, make clear the chronology that led to Savvy defaulting on its loan repayments.
Savvy staged a hydroflight event, Battle on the Rock, in Hamilton Harbour from August 25 to 27, 2017.
Ms Trott worked for the corporation, as well as being chief operating officer of Savvy, and the municipality gave “in kind” support for the event but put no money towards it, according to the records.
Meeting minutes and e-mails show that city councillors John Harvey and Dennis Tucker emphasised the need for a thorough check on Mr Blakey’s financial background.
At the end-of-show prize-giving, Mr Blakey announced: “Poseidon Games, our world tour, will kick off next year February as ‘Battle on Khalid Lake’ in Sharjah [in the United Arab Emirates].”
He described Poseidon Games as a “five-country open international hydroflight tour” and said contestants would “battle head-to-head to return to Bermuda” in September 2018 to compete for a trophy.
His words were quoted in the media, and the UAE event was advertised to take place about 30 miles from Dubai from February 15 to 17, 2018.
Ms Trott referred to the event in a January 16, 2018 e-mail seeking financial support from the Bermuda Tourism Authority, which was copied to Mr Simmons and Mr Rochester. She wrote: “The inaugural games are in four weeks in Sharjah, UAE …”
Savvy claimed in material sent to the BTA, Mr Simmons and potential sponsors that the tour would feature performances from international music artists, naming Bruno Mars, Coldplay, Sia and Cee Lo Green.
However, Mr Norris said their promises always seemed “too good to be true“ for such a niche sport.
The Khalid Lake event never took place. A January 30, 2018 “urgent” e-mail, seen by the Gazette, advised participants the event was cancelled owing to “some unforeseen circumstances”.
Mr Blakey and Ms Trott were far from the UAE on February 15. They appeared at a press conference that day with Lieutenant-Colonel David Burch, the Minister of Public Works, who told the media that Savvy had taken over management of Cross Island, the former America’s Cup home, and nearby Moresby House, and would create an entertainment hub there.
The minister did not mention that a taxpayer-funded loan was being considered for Savvy. He described it as a local company that was part of a “global entertainment company based in Atlanta, with offices in Frankfurt and Hamilton”.
Savvy was actually registered as an exempt company and required ministerial permission to conduct business in Bermuda. Police were later told by the Registrar of Companies, according to a court document obtained by the Gazette, that “Savvy had not been granted any exemption to conduct business” here.
Colonel Burch said in a February 13 statement: “I did not know Savvy was an exempt company, but I did know they had worked for the Corporation of Hamilton previously.
“I didn’t think it appropriate to include something [the proposed grant/loan] that had not yet been approved...”
A government spokeswoman said Savvy was engaged during the One Bermuda Alliance’s time in power to work on the America’s Cup, so was an “established government vendor” before the July 2017 election.
Ms Vance, a Texan who had worked on various international hydroflight shows and had “many contacts in Dubai”, said the Khalid Lake event did not happen because Savvy failed to pay the deposit for the venue.
She had flown to the Middle East with Mr Blakey, his brother Tim and Ms Trott in 2017 to put them in touch with people she knew there and to scout out a location for the Poseidon Games event.
“We found one and were supposed to pay a deposit on it,” she said. “I’m back in the United States and a friend in Dubai said, ‘Hey, are you going to pay this deposit?’”
Ms Vance said Mr Blakey told her he had sent the money, but “this guy [in Dubai] says that’s not true. That’s when the house of cards started to fall apart.”
Mr Norris recalled: “There came a game of them claiming to have transferred the money for the venue.”
He said Savvy sent a photo of Mr Blakey apparently holding a bank transfer to the UAE contact, but it appeared they had “just Photoshopped it”.
Mr Norris said a partial payment was eventually sent, even though it was clear the battle would not go ahead. “They just sort of kept up appearances.”
After the Khalid Lake event was shelved, the next date on the “tour” — the Battle at Sanctuary Cove in the Gold Coast — was just weeks away, on April 6 to 8, 2018.
The urgent e-mail advising that the UAE event was shelved, sent by Ms Trott, included an offer to all registered riders of a round-trip flight and accommodation for the event in Australia.
Another e-mail seen by the Gazette from Ms Vance said she was organising flights for 80 people travelling to Sanctuary Cove.
Savvy Entertainment asked the Mayor of Hamilton to provide a loan to pay for a hydroflight event in Australia, but Charles Gosling declined.
A public access to information disclosure from the Corporation of Hamilton includes a March 21, 2018 e-mail from Savvy chief operating officer Danilee Trott to Mr Gosling titled “Savvy Challenge“.
Ms Trott wrote about a planned meeting with the Bermuda Monetary Authority, telling the mayor: “We will definitely take your advice on how to handle them and pray for the best”.
It is believed the BMA may have told Savvy to cease its activities on the island because it lacked the ministerial permission needed by an exempt company to operate locally.
The records do not confirm that, but they do show Savvy was struggling, including financially.
Ms Trott wrote to Mr Gosling: “At this point, we feel the fastest solution is to try and obtain a short-term loan [or a few smaller ones of $50,000 or $100,000] for 30 days to get us enough liquid cash to at least save the event series [and our professional reputation] while we deal with BMA.
“I have negotiated Australia down to accept partial payments by Friday … I am basically just trying to find interim cash because legal paths are still not going to be resolved in 48 hours, which is the time frame we have to get at least partial funds transferred.”
Ms Trott’s message was sent to his company e-mail, but Mr Gosling said he included it in the Pati disclosure in the interests of transparency.
Mr Gosling recalled to the Gazette that Ms Trott’s e-mail to him followed a telephone call they had. He did not remember the specifics about the BMA, but said it may have been to do with efforts by Savvy to be recognised as a local company.
Ms Trott, who was a City Hall employee, told him Savvy needed funds to pay for the Australia event and asked if he would be interested in giving a loan, but he was not interested.
“That’s just not the way to do business,” he said. “I knew she was going through the list of usual suspects she would be going after for loans like that.
“It was kind of disappointing that I had made my way up into that list.”
Mr Gosling said he met Savvy chief executive Anthony Blakey and described him as “not really my cup of tea” and “just a real smoothie”.
However, he said he was “thrilled that Danilee had somebody” and that she was seeking to succeed in business.
“I’m always pleased when somebody looks to being upwardly mobile …”
The Cabinet Office records show that Savvy invoiced Mr Simmons on March 27, 2018 for an $800,000 loan for a “studio installation”. Cabinet approved the loan the same day.
Ms Vance said she was due to meet Mr Blakey and Ms Trott, whom she described as business and romantic partners, in the Gold Coast on March 31, 2018 to prepare for the Battle at Sanctuary Cove but they told her they were delayed on business in Bermuda.
She said: “They were paying me to be the event co-ordinator. I landed and the hotel contact said ‘they haven’t paid the bill’.
“I said ‘what do you mean they haven’t paid the bill?’ They said ‘we are going to have to cancel the event if it doesn’t get paid.’”
Ms Vance said: “I was in pure panic mode — and I don’t panic at all.“
She knew that judges and scores of “riders” taking part in the competition would soon start arriving, and had been promised hotel rooms and other hospitality.
Ms Vance called Ms Trott, who she said told her that Savvy was about to obtain funding and would pay the Australia bill as soon as that came through.
“Within 48 hours of me being in Australia, the bill was paid,” she said. “I found out years later that what was happening was that Dani and Anthony were meeting with the ministers to get this money.”
The Pati disclosure includes a loan agreement, dated April 2, 2018, which includes the “strict condition” that the $800,000 from the public purse could be used only for the studio equipment and set-up.
Ms Trott and Mr Blakey, trading as Savvy, were “jointly and severally liable” for the repayments, which had to begin three months after the $800,000 was received.
The agreement stated: “For the avoidance of doubt, the loan may not be used by you to fund other business, to pay or discharge any other loan, or to make expenditure not directly connected with the studio …”
The loan was for three years, at an interest rate of 4.75 per cent, with repayments to commence on July 1, 2018 — but Savvy quickly defaulted on repayments, according to the released records.
Ms Vance described the Sanctuary Cove event as “successful from the point of view of the riders” but not financially, as Savvy failed to get the sponsorship it had banked on, and the “tour” fell apart.
“There was supposed to be one in Singapore,” she said. “We scoped out locations. Dani was with me. It just never came to fruition.”
The remaining tour dates of New York and Mexico were abandoned, and the grand finale in Bermuda was downgraded to a hydroflight exhibition for cruise ship visitors to watch in Dockyard in October 2018.
Mr Norris, who did the scoring for the 2017 Battle on the Rock and the Gold Coast event, said the Poseidon Games concept “was always suspect”.
He said there was little money to be made in hydroflight, as the sport was not widely followed. “They claimed to have network television coverage and all this market for the event. It did not make any sense.”
Ms Vance said Ms Trott called her months after to tell her “Anthony has absconded with all this money”.
“I do remember the gist of the conversation because she was devastated,” she said. “Not only did she lose a business partner, she was left holding the bag with the Bermuda Government.
“All of that washed down the drain. She loses the man she’s in love with. She’s on the hook for this money.
“It’s interesting it was called Savvy; he’s a savvy guy. He walked the walk, talked the talk, but just couldn’t execute.”
Mr Burt apologised in September 2020 for overseeing the loan to Savvy, but insisted civil servants released the money after conducting background checks.
The Premier said in a statement: “Every financial order was followed, advice from technical officers for the protection of the Government of Bermuda was accepted, and due diligence was performed.”
Efforts to recover the $800,000 loan given to Savvy Entertainment by the Government appear to have failed so far.
A government spokeswoman noted on February 13 that the company was wound up by court order in February 2023 and the Official Receiver, as provisional liquidator, was the authority responsible for providing a report on any assets Savvy may have.
Those court proceedings heard that Savvy defaulted on $778,204 of the loan. The spokeswoman did not answer a question about how much of that had been recovered.
The Gazette has requested details under public access to information from the Registrar of Companies.
Studio equipment which had yet to be bought was put up as security on the loan to Anthony Blakey and Danilee Trott.
A public access to information disclosure from the Cabinet Office includes April 2, 2018 e-mails between the financial comptroller at the economic development and tourism ministry and Curtis Stovell, who was then the Accountant-General.
Mr Stovell asked: “Has security been provided for the loan i.e. does govt have first rights to the equipment in the event of default and is the borrower required to obtain govt's permission before selling or disposing of any of the equipment?”
The comptroller replied: “Yes and also no further lending is allowed to Savvy without the government agreeing to it. The loan agreement is attached … if you would like to review in full, but it’s pretty comprehensive with regards to protecting the Government.”
It wasn’t until the day after Savvy received the $800,000 that it was asked by a senior civil servant to provide a list of the studio equipment with serial numbers and identifiers "so that we can register a first charge against the equipment“.
Randy Rochester, Permanent Secretary at the Ministry of Economic Development and Tourism, also asked Savvy in his April 5, 2018 e-mail for an “acknowledgement or some formal proof that the borrowers are in fact contributing $400,000” and a “cost estimate or price list of the equipment so that Government can prove the value attributed to it by the borrowers in case we have to undertake collection action on the loan”.
Cabinet ministers had approved the loan on March 27, 2018 but told Jamahl Simmons, who was then the Minister of Economic Development and Tourism, that there had to be a security in the event of non-repayment.
After Savvy’s principals asked to delay repayments in July 2018, Mr Rochester wrote to Mr Blakey: “In relation to obtaining the equipment, can you kindly let us know when you are expecting delivery for our records? Equally can you please arrange with … the ministry's financial comptroller, to carry out a complete audit of the equipment with all the relevant supporting documentation.”
In an August 31, 2018 e-mail, the ministry comptroller wrote: “We have had the first payment off them … albeit late. Due to several issues at their end they did request a payment holiday which we subsequently declined. I am hounding them daily to try and get the second payment on time … but I doubt it!”
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