C151, PT Hanno Bali, Hanno Soth; the bubble blurt or burst?

C151, PT Hanno Bali, Hanno Soth; the bubble blurt or burst?
By Donald Trumped
Oct 11, 2007, 07:05

Hanno Soth then (with Carmen Herbert) and now (Bintan Islands signing) - Bali's most successful developer or failing, murderous flim-flamer?

My goodness but Mr. Hanno Soth has a history; some of which we agree with him is best just referred to, not restated again in full. Hanno Soth is a Badbramstedt German born Canadian, ex-Hawaiian (sort of) handy man and suspected by some gerontophile and murderer at the age of 26, who came to Bali under somewhat of a cloud over an inheritance (which the US Courts subsequently repealed) from the late Carmen Corrine Herbert, who died under somewhat unusual circumstances and was cremated it seems somewhat hurriedly aged 84 years old. The story was actually published by reporter Ian Y. Lind of the Honolulu Star-Bulletin (see: Hanno Soth Story) who had traced Hanno to Bali and included several statements regarding Soth’s meteoric rise to wealth by one of his friends on the island, Thomas Henderson, who says he gave Soth free lodgings for 18 months when Soth first arrived in Bali

What intrigued us most was despite the fact we think the comments made by Thomas Henderson were somewhat flattering about Hanno Soth, in true Balinese expat form Hanno Soth actually filed a criminal libel complaint with the very corrupt Balinese police over what he said! If Henderson was a friend of Soth, can you imagine what Hanno might do to an enemy? What amazed us more was that Hanno Soth included the Honolulu Star-Bulletin reporter Ian Y. Lind in the police complaint, which the Balinese police in typical if not paid for fashion accepted. Forgetting the complaint element against Thomas Henderson, who presumably was in Bali and therefore covered by Indonesia’s nasty jurisdiction for a while, what on Earth could Hanno Soth hope to achieve by making a Balinese police complaint about a newspaper reporter in the USA who has never been or is likely to come to Indonesia? Hanno Soth even publicly confirmed the police were investigating the complaint against Ian Y. Lind and cited a police investigation number dated 31 March 2005 to prove it. In fact, Hanno Soth went to the extreme of building his own news web site, News Clips Net, which claims the police had confirmed Ian Y. Lind had a case under Indonesian criminal law to answer for!

Of course like much Indonesian criminal law and Balinese police investigations, this is a yet another nasty joke. No, we believe Hanno Soth that the police “took” a complaint from him and started an “investigation” about an article written outside Indonesian jurisdiction. Ian Lind had been contacted by Soth by email 4 years after his article (see: Ian Lind’s August 2nd, 2004 diary) but never heard back from Soth again after responding to him; we recommend people read this to see what Soth considers defamatory. Ian Lind then discovered about the police complaint in 2006 (see: Ian Lind May 8th 2006 diary). We contacted Ian Lind and asked him, in light of the defamation allegations made by Soth to him, whether he was sure of his facts regarding Soth being a handyman for example; Lind replied he had the trial transcripts which frequently referred to Soth as “a kind of handyman”. As for the statements indicating Hanno Soth was believed to have had a romantic and perhaps even sexual relationship with Carmen Herbert, these were clearly someone else’s words, not Lind’s.

So not only does the reasoning behind Soth’s allegations of defamation seem bizarre, but the Bali police investigation itself is clearly just yet another case of pandering to the whims of someone with connections or a full wallet in Bali, with maybe the police waiting to see if the “suspect” ever comes to Bali where their corrupt law applies. Hanno Soth now editor of his own “news clip” site justifies the police action by claiming the published item was then circulating throughout Indonesia and therefore was damaging to his company, PT Hanno Bali. Of course, for Indonesian criminal libel codes to be correctly applied, the article would have to be written in or published within Indonesia or in the Indonesian language in order for the Balinese police to claim any jurisdiction whatsoever; we bet they and Hanno know this. When we read some of Hanno’s text, for example the terms and conditions on his C151 net site claiming that anyone who so much as visits the site is bound by PT Hanno Bali’s rules, plus that no-one can so much as link to his site without his express permission, gives us additional cause for concern that Hanno Soth may well be mentally deranged. Having said that we are sure we will be the subject of yet another Balinese police “investigation” against us, this time by complainant Hanno Soth and all we can say is “Bring it on boys”.

Many people get confused about Internet or other forms of defamation AKA libel, for example with the Times / Suharto case. It is actually quite simple; there are two forms of libel, criminal and civil. Most countries have criminal libel laws but only pretty much as legacies from a darker time when used to protect the powerful from the less powerful, as with Indonesia and its criminal libel code from the Suharto era; this basically means you can not publish anything about another person in Indonesia that is even slightly defamatory, no matter how true and in the public’s best interest it is, unless you have that other person’s permission! The English law that forbids any of its subjects from defaming the Queen shows that criminal libel still exists in many places, even when and where the subject is generally left well alone by the judiciary, normally due to other constraining legislation such as in Britain’s case with Article 10 of the European Convention on Human Rights (freedom of speech); Indonesia’s very corrupt judiciary does not have such a constraint. All criminal law though is constrained by one thing; national boundaries, except with some countries who can apply aspects to their own citizens while overseas. Conversely, civil libel is often portable jurisdiction wise in that it is possible for say a Russian to sue an American in London for a defamation written by the American in Australia, if that defamation was untruthful and / or not in the public’s best interest and harmed the Russian subject in England. However, in this example, if the American who committed the alleged defamation had neither residence nor asset in England, the courts would have to reject any action there.

The above hopefully explains why nasty Indonesian businessmen, politicians and police officers love to abuse the criminal libel law in that sordid country, even when they know they do not have jurisdiction. You see, by making a criminal investigation for Hanno Soth, the Balinese police gave him PR, nothing more regarding Honolulu Star-Bulletin reporter Ian Y. Lind. Of course if Lind ever went to Bali he would probably find his name on the detain list with the immigration officers at Ngurah Rai Airport, as totally outrageous criminal libel and other investigations give the chance for Bali’s mafia in uniform to play the “failure to respond to a summons” card. It is very likely that although Mr. Lind and the Honolulu Star-Bulletin never heard anything about this complaint until someone pointed out Hanno’s “news clip”, an unlawfully made summons was made and equally unlawfully executed. Ignoring a summons allows the police in Bali to detain someone for up to 60 days without charge; 90 days with a 30 day court extension, like when they afflicted poor Sang Ayu (see: Candi Internet Bali). With Balinese jails being places to avoid and because human rights groups report Indonesian police regularly murder and rape victims, you can see why the Balinese police basically make sure anyone who wants to come to Bali honours their perverted law outside the law, which generally means paying extortion money or going to jail for fabricated crimes. So Ian Lind may well qualify for some free accommodation in Bali should he ever decide to go!

So anyway, what did friend and ex-business partner Thomas Henderson, who presumably had something to worry about from a police complaint being in Bali at the time say? And why did now wealthy (or perhaps not) Hanno Soth get so upset about it? Ian Lind’s article quoted Mr. Henderson as follows; "He (Soth) posed as a major developer. He tied up twenty acres of beachfront property with no money at all, and was trying to get investors. He had about $60 in gold jewelry, and traded that for rights to the property. It's not really flim-flam. He just tries to tie things up with minimal investment. He's what I would call very shrewd." So why is that so bad? It sounds flattering to us! Ah, is it perhaps now Hanno Soth considers himself to be the cream of the business community in Indonesia and that such references to his humble past without his permission are defamatory to his present standing in the community? After all, despite Hanno Soth’s denial to us, clearly he could not have had a lot of money when he arrived in Bali, having been a lowly “sort of handyman” in Hawaii and without the benefit of the inheritance from Carmen Corrine Herbert, which he ultimately never got. It seems that in Indonesia you have the right not to have had a lowly previous life if you have money and influence now. Or is there more hidden reason behind Soth not liking his past to be known?

So how did Hanno Soth make so much money in Bali? Mr. Henderson got it right, Soth was very shrewd. We can only speculate on certain areas of his rise to the top of Bali’s too often cesspit of expatriate life as follows; by getting some real estate deals going with little more than bravado, by up-selling small villas which others describe as looking like units in a mid-1970’s English housing estate surrounded by palm trees, by working with very well connected people both within Indonesia and in neighboring countries, by taking the false perception that a foreigner can legally own a villa in Bali a step higher using the PMA (private foreign investment company route), by selling to the rich and famous, and by working the nepotistic designer (big bucks) tourism industry to get glowing media praise plus a prestigious international real estate company involved, thereby perhaps over-valuing and “legitimizing” the whole operation. Hanno Soth and PT Hanno Bali are hoping to move on to different things these days though (Bintan Islands), but let us just focus on the C151 villas that got them where they are today.

We said we can only speculate on how Hanno Soth precisely did business with his C151 villas because he actually denies certain things personally that his company and agents published on their own and various other web sites! It seems now the C151 villa bubble was nothing but “blurt” and has now burst. Hanno Soth admits his C151 web sites are out of date, but we wonder whether that is just a smoke screen to hide business as usual when he can now get it. On the C151 web site it states “C151 villas will be owned by private investors and managed by C151 Management Group” and goes on to say that Colliers International, a real estate sales company, is its sole international sales agent. But in an email to us Hanno Soth stated “Pt. Hanno Bali - does not now or have we ever sold Indonesian freehold real estate to foreigners”. This seems to be more than a mistake by Mr. Soth; a deliberate falsehood and spin, a tricky lie. We do not doubt PT Hanno Bali has never sold freehold real estate to foreigners, because it can not, but we believe the company clearly did and perhaps still does offer villas for sale to foreigners, the “shrewd” difference being “sell” Vs. “sold”; you can advertise you sell something you can not, but it can never be sold. In the same email Mr. Soth said “Pt. Hanno Bali has offered leases to foreigners interested in investing in our projects”, but we do not believe this either, as his web site talks about investment, not rental. It may well be a very shrewd and selective Mr. Soth has leased out some villas to foreigners, but that we believe is not how his business fundamentally operated. You only have to do a cursory search of the Internet to find statements like “Club 151 (C151) makes owning a dream Villa easy, affordable and profitable”.

Even on PT Hanno Bali’s own web site is a press cutting which says “PT Hanno Bali's Seminyak properties, consisting of both leasehold and freehold”. So we are sure PT Hanno Bali “sold” “freehold” villas to very wealthy foreigners using PMA (private investment company) formations; Hanno even said his villa resorts were operated under PMA approvals and that PT Hanno Bali itself is a PMA company. It is hard to clarify exactly how Hanno Soth “sold” his villas, but it is clear his company did market their villas as being for sale, and it also clear things are not all sunshine and light with C151 right now.

For one, when you visit and search Colliers International it appears they no longer sell villas for PT Hanno Bali, despite the fact Hanno Soth’s web site says they do. When we contacted Colliers about this we were promised a response from the regional director in charge of that area but never got it. Hanno Soth himself said “Not on the Colliers website - because we are not actively marketing our Villas in favour of developing our own resort properties”. However, a search on the Internet revealed that sure enough, Colliers were still offering C151 villas in Bali for sale on their Hong Kong Residential Property site. We wondered why these listings were not appearing for searches on their main site; it almost seemed they had buried the C151 listings there for specific customer referrals only, not for general public discovery or digestion. We put Mr. Soth’s comments about not being on Colliers any more and that the statement these villas were for sale was fraudulent as they could not be under Indonesian law, but Colliers have declined to substantially reply.

Hanno Soth also, unfortunately under a caveat of confidence so we can not state specifics, indicated things were about to change as a result of his being “frustrated by Indonesia and its bureaucratic and yes often corrupt system”, hmmmm. Could this perhaps tie in with the recent changes by the Indonesian Government regarding PMA formations to stop them being used as foreign tax dodges (implemented back-to-back with offshore companies in places like the British Virgin Islands)? That PMA’s for villas can no longer apparently be “obtained”?

We believe the PMA route, if that was the one used by PT Hanno Bali as it seems, is just as legally flawed as the other methods by which foreigners attempt to “own” or otherwise control villas in Bali; especially villas offered for rental to tourists as C151 villas clearly are. Trying to see through the seeming smokescreen of misinformation and pick out the threads from the yarn from what Hanno told us, it seems clear PT Hanno Bali operates by both “institutional” financing which allows them to operate “resorts”, and by selling villas to the rich and famous by way of a PMA in their, or their customer’s nominated offshore company’s name; the villas managed then, as specified on C151’s web site, by C151 Management Services. If we are right, under the rules of a PMA, the sales by PMA part of all this would be totally unlawful in that potential PMA holders have to present proposals for their business venture, not simply take over an existing or someone else’s commenced business plan. Of course regulations in Indonesia can be overlooked if you have the right generous bank balance and / or know the right people.

Hanno Soth certainly appears to know the right people. To get the development rights to 11 islands near Singapore in what is ear marked to be a free trade zone must have taken some handshaking; we wonder whose! PT Hanno Bali scooped an award from the Indonesian Ministry of Justice in 2007 no less, the Citra Insani award for people’s innovation. Quite why the Ministry of Justice is handing out awards for innovation we can not fathom, but there it is. Yes, that is the same Indonesian Ministry of Justice which in 2007 got caught laundering / acting as middleman for a transfer of money for Tommy Suharto. Kind of ironic therefore that Hanno Soth told us “I think you will see this announced in the coming weeks as we also publish our own complaints about the government”. Is that the same Indonesian Government which often seems at loggerheads with various governmental departments or factions loyal to the Suharto family? Is this anything to do with a crack down on PMA run villa operations which are back-to-backed with offshore tax exempt companies predominantly in the British Virgin Islands? Isn’t the British Virgin Islands the Suharto family’s favored offshore location also?

So is PT Hanno Bali actually doing well and adequately financed, or is this a case of “Flim-Flam”? Soth commented to us that PT Hanno Bali had to buy back quote “most” of their villas from clients after the last Bali bombs (August 31st, 2005). His company is marketed as being well funded as it now appears to be embarking on super luxury and anti-aging resorts for the rich and famous on exotic millionaire only islands next to Singapore, or is it!. It looks like his C151 projects in Bali have been in progress for quite some time and that he signed up for rights to the 11 Bintan islands in 2003, but nothing has happened past conceptual drawings and marketing text!

We wonder who PT Hanno Bali’s institutional financiers are; whether they could be the Suharto family who are presumably finding it harder to move money around these days. After all, with the straps on foreign cash for such high risk, high ticket tourism projects because of rampant corruption and terrorism fears for Indonesia, who on earth would be willing to be put up large amounts of cash for an offshore private investment company whose director perhaps has a very questionable past; probably not any of the more mainstream investors! The Suharto’s certainly seem to like invest their ill-gotten gains in Indonesian tourism, just look at the number of family owned luxury hotels in Bali they have (see: Suharto’s Bali Hotels), plus ex-con Tommy was meant to be interested in sinking millions into a marina at Kuta. But the talk seems to have evaporated somewhat with the world banks watching out for Suharto’s stolen billions. Or maybe PT Hanno Bali has no finance at all; maybe it is bust in all but name.

Ultimately to us it all looks like just another shady company run by an even shadier individual in Indonesia, who tried to put the friend that supported him for 18 months when he first arrived in Bali and under a financial cloud in jail. To which we can only say, “Hanno Soth, you surely must be one of if not the lowest of the expatriate low in Bali, and that is a long way down. It is a shame the death of Carmen Corrine Herbert could not have been investigated as it seems would have happened had her cremation not been so soon after her death. If it were not for the questions over Hawaii, the nasty police complaint you made in Bali, the multiple contradictions that show you are a liar and a fraud, the seemingly ludicrous terms and conditions on your web site that we believe show your aggressive and untenable legal and other mind set, we would actually greatly admire what you have allegedly built up for yourself. But in light of what we have discovered about you, your villas and your business, we can not understand why anyone would want to stay in one of your highly priced accommodation cubicles, nor can we understand why anyone without money to burn would invest a single cent in anything you did less you were a bakso vender during a famine. For us you appear to epitomize everything that is bad and unfortunately typical in Indonesia, and represent yet another very clear reason for people to avoid the country.”