Colin Chapman, founder and figurehead of Lotus Cars, designer and innovator extraordinaire, died of a heart attack, in the arms of his wife, Hazel, at 4am on the morning of December 16, 1982…and has since been living comfortably somewhere in the wilds of South America thanks to a generous grant from Her Majesty’s government.
In 1978, Mario Andretti would become the 6th Lotus pilot to become World Drivers Championship since 1963. Moreover, the team had also taken 7 Constructors Championships over the same 16 year period. Surely this would be enough to make a nation proud. But yet, after applying for a paltry 400,000 pounds sterling grant to help further development of his very British team, Collin Chapman was turned down.
Within days, Chapman learned that American John DeLorean, a former designer and executive with GM and Chevrolet, had just received a 54 million pound grant from the same Labour party. To manufacture his stainless steel, gull-winged DMC-12, DeLorean had offered to build a factory in Belfast, a scheme which would create some 2,500 new jobs in the downtrodden area. DeLorean also promised that production would begin within 18 months, though he had neither a factory nor a proper design for the car.
Porsche and BMW had both turned down requests from DeLorean Motor Cars to be part of the program, so DeLorean offered Chapman $12 million to reengineer and develop his original design for the car. Colin initially declined, but when the offer was upped to $17.65 million, Chapman’s long time accountant, Fred Bushell, convinced him to accept the deal, but only if the funds were paid up front and directly into Chapman’s offshore GPD account. And now, my conspiratorial friends, is the time to stand and take notice.
Years earlier, Chapman and Bushell had devised a company called GPD Services Inc, originally Grand Prix Drivers, though later changed to General Productions Development. Set up with an address in Geneva, GPD in all actuality had no assets and no physical offices. ‘Operated’ by the wife of former driver and Lotus employee Jerry Juhan, GPD appeared to be nothing more than a Swiss bank account for Chapman and his drivers to evade high British taxes.
A check for almost $18 million, essentially written by the taxpayers of the United Kingdom, was written to GPD; a check which mysteriously disappeared without a trace. A second check was written to the normal Group Lotus accounts, cashed and production was then able to begin on DeLorean’s cars.
Chapman, however, had seriously defrauded both the shareholders of Lotus Cars as well as the rest of the company management by failing to mention the 17 million in up front profits. By receiving the money, he had also guaranteed the company’s work without anyone other than himself and Bushell even knowing.
When production finally began in early 1972, DeLorean estimated that the company would need to sell between 10,000 to 12,000 units a year to break even. A lack of demand, cost overruns, unfavorable exchange rates and a dock strike in Britain, which was delaying delivery of parts, would begin to take their toll on DMC. It didn’t help that the cars were slammed by critics world-wide. By the end of the year, only 6,000 units had been moved.
There was also a dispute between the company and the British government, which was reluctant to provide a further 30 million pounds that DeLorean claimed it was due as an inflation adjustment. These additional monies were jeopardizing guarantees on 24 million the company had borrowed from banks (it was this money that DeLorean would eventually attempt to recoup by conspiring to sell $24 million worth of cocaine, but that’s another story). By February, the company was in receivership, having only produced some 9,000 cars in 21 months, and the British government ordered the factory closed in November, 1982.
After DMC of America filed for bankruptcy, Margaret Thatcher sent her Receiver hounds to track down the missing 17 million paid to Chapman’s GPD. DeLorean would go on to state that Chapman had in fact used half of the money to buy $60 million in shares of DeLorean for $8.5 million, fearing that the car would put Lotus out of business. When questioned directly by authorities, Chapman claimed to have no knowledge whatsoever of any $17 million pounds. It was eventually discovered that half of the $17 million was found in one of DeLorean’s personal accounts. The remaining GPD money was never accounted for.
The British government pursued the lost money through the American courts and, in 1989, the Serious Fraud Office raided Fred Bushell’s house in Norwhich. He refused to co-operate in discussing the missing GPD funds and, in 1992, was sentenced to four years in prison after pleading guilty to “Conspiring with the late Colin Chapman and others to defraud the DeLorean Motor Companyâ€. The judge in the case went on to state that, had Chapman still been alive, he would have been investigated for possible complicity in the manipulation of government funds and, more than likely, been found guilty and given a ten year prison sentence.
In researching on the all knowing and always truthful interwebs during the course of writing this story, I came across the strangest quote. Unfortunately, it came with no reference to who originally spoke it or from whence it came, so this is the point where I officially convert F1B from an online journal of opinion to the International Enquirer. It is also where I throw all journalistic integrity to the wind in order to share something that, however far fetched it may be, is at least a very entertaining thought;
“Once, Emerson said that he met Hazel Chapman in the Sao Paulo airport in or about 1985. He asked what she was doing there and she replied ‘holidays’. Emerson found that strange, because he remembered she had a huge fear of flying in aeroplanes, so why on earth would she go to Brazil, alone, and make no previous contact with someone she knew there, like Emerson?â€
