Rick Otton has had a lasting impact on some of his students, and similar risks are there for students of other wealth mentors, including Dominique Grubisa. Also see ‘Rick Otton what harm did he do?’
Property guru Rick Otton didn’t tell Sheree Becker to commit fraud. However, a large part of Otton’s dogma was aimed at conditioning students like Becker to reject any views that challenged his teaching. This included opinions of friends, family, lawyers and government agencies.
Otton taught how to prey on people in distress – or as he said “helping people”. Not only were innocent owners and buyers harmed, but the Federal Court found Otton unable to show one example of where his strategies had been successful.
Otton claimed his strategies were “challenging the status quo”, and criticism was due to “tall poppy syndrome”. He claimed “There’s nothing you can’t do, it’s just an undiscovered process” and “95% of lawyers are deal breakers”. When asked by a student “Is this legal” Otton shut off further questions from the audience as he joked “Do you have a lawyer? Is your lawyer legal?”
Students who drank the Kool-aid were rewarded with “Big Kahuna” status, appearing on stage and in podcasts. “Lawyers kill deals if you’re not in the room” says one “successful student” talking about the risks of a homeowners getting independent advice. Says another student “… you can’t really fail. Even if you completely mess something up, it just means you make less profit”
It’s easy to see how students who placed trust in Otton might lose all sense of what is legal and ethical, and why they might not see warning signs that they were ‘crossing the line’ til it’s too late. One Otton student who was prosecuted asked in a Facebook group “Why is it, that out of 10,000 Rick Otton students, I have been singled out and have a case to answer in Supreme Court?…I didn’t invent this, I learned it”
Here is Otton’s response to his students being prosecuted for using the exact same phrases that he taught.
In the end, Otton was also victim of his own bravado. Otton’s response to legal action against him and his students was flippant, claiming a “new law” in Western Australia caused the problem (the law hadn’t been changed for decades). When imposing a record fine of $18 million on Otton and his company, the sentencing judge took into account that Otton failed to learn and review his strategies following the regulatory action against him in WA.
An endless stream of platitudes reminded students not to worry about any problems they face, and to ignore setbacks. This can be useful advice in the right context, but is dangerous when combined with unethical methods that are not as profitable as claimed. Otton’s adages included:
“Be prepared to do what others won’t…make a new standard”
“Entrepreneurs never give up”
“… if you do something that nobody has ever done, does that make it illegal or just threatening”
“..failure is part of the learning process”
“a negative thought is a down payment on an obligation to fail”
“You only need to be right 51% of the time to be ahead” and of course,
The illogical ‘3 stages of truth’ misquote – which suggests that if people laugh at your ideas they must be true!
There are often good reasons to question professionals, regulators and government. However, if you think that
· most accountants and lawyers advise against your business model because they “don’t understand”,
· regulators only act because you’re “rocking the boat”
· criticism just comes from haters and losers, and
· when things go wrong it’s you– and not your dodgy mentor,
you’re being conditioned for your mentor’s benefit – not yours.