Self-proclaimed monarch behind South Pacific Ponzi scheme still promises riches with illegal BVK notes

Emerging from an anteroom wearing a British-style red army jacket, a blue sash, and a crown of cowrie shells, the slightly-built king shuffled stiffly into his office, his eyes bloodshot and a scar running across his jaw.

His Majesty David Peii II took a seat behind a desk cluttered with bank notes bearing his portrait and a well-worn laptop that he uses to warn the world of a coming global financial collapse — and the spectacular shower of riches to come.

Once a pious young man known as Noah Musingku, His Majesty became famous for running a Ponzi scheme that is estimated to have stolen tens of millions of dollars from victims across the South Pacific around the turn of the millennium.

Living for two decades as a fugitive deep in the interior of Bougainville, a lush and war-scarred autonomous island on the far eastern edge of Papua New Guinea (PNG), Musingku has reinvented himself as the divinely anointed ruler of a small fiefdom of locals who believe he will make them all billionaires any day now.

But OCCRP traveled to Musingku’s metal-roofed royal compound to follow a different, unreported story.

For years, tales have trickled out about curious foreigners, usually Western men, journeying to the territory that Musingku named the Twin Kingdoms of Papaala and Me’ekamui to make their fortunes.

Unlike the miners who typically arrive to exploit this gold- and copper-rich island, these foreigners seek a different form of treasure: the crudely-printed currency on Musingku’s desk, known as the Bougainville Kina, or BVK.

The money is illegal in the eyes of PNG authorities, and worthless in the global financial system. But for Musingku’s adherents, these strips of glossy paper are more real than the U.S. dollar and a better investment than even the buzziest tech stock.

Speaking to OCCRP, Musingku breezily denied accusations that he is a con artist or that the colorful bills in front of him are fake.

“The first lot was printed in Canada. The next one was in Russia,” the king rasped, gesturing across his desk. “And this one’s printed in Australia.”

“It’s hard to stop them,” Musingku said of the followers who have forded rivers and braved the cratered roads to reach his compound. “They keep on coming, keep on coming.”

Who are these visitors? A red guestbook by the door offers some clues.

Stretching back as far as 2008, it catalogues a stream of adventurers — a builder from Sussex, England; a pair of evangelical megachurch pastors from Florida; a Japanese businessman called to visit the king by the spirit of Admiral Yamamoto.

These are just a fraction of the thousands of people around the world who have become enthralled by the king — and his self-styled BVK currency — without ever meeting him.

Millions of dollars have been lost, lives have been upended, and a handful of people have faced serious prison time.

This is the story of how a fugitive in one of the most isolated outposts of the Pacific united a global empire of fringe beliefs, where everything — from the nature of money, government, and the very fabric of reality itself — is up for debate.

‘An Abomination in God’s Eyes’

One of those drawn to Musingku’s world was an American father of 10 named David Johnson.

For the close-knit and god-fearing people who knew him on the plains of North Central Iowa, Johnson seemed like a man you could trust.

A devout Christian, he had grown up in the area before following in his father’s footsteps to become a financial adviser.

But the trauma of the 2008 financial crisis shattered his faith in the safety and legitimacy of the U.S. financial system.

The U.S. dollar, he concluded, was worthless — just a “fiat currency” backed by nothing but debt and government lies. The economy was a house of cards, and a reckoning was coming.

Fortunately, he saw a way out.

He had learned that on the other side of the world, a righteous Christian king, Musingku, was peddling a currency supported by something real: billions of dollars in untapped gold beneath Bougainville’s surface.

“I know this fiat, debt-based monetary system is evil and wicked and satanic and an abomination in God’s eyes,” he told OCCRP. “So when I found [the BVK], I’m like, ‘Wow, this is so awesome.’”

What Johnson had stumbled across was an exotic variation of a growing trend across much of the world: money-making schemes undergirded by beliefs in arcane, anti-government conspiracy theories, typically with their roots in right-wing and libertarian thought.

This is a corner of the investment world often tied up with the ideology of so-called “sovereign citizens,” who use complex and confusing pseudolegal arguments to claim they are not subject to government authority, and are exempt from everything from paying taxes to carrying a driver’s license.

Modern “fiat” currencies like the U.S. dollar, which was decoupled from the value of gold in the 1970s, come in for particular ire, as they are seen as simply backed by the formal word of a government sovereign citizens see as fundamentally illegitimate.

Having rejected the authority of everything from the Federal Reserve to the British Crown, “sovereigns” seek incredible returns in obscure investments based on novel sources of legitimacy, like Iraqi dinars or century-old bonds issued by China’s pre-revolutionary government.

They have also flocked to the BVK.

That’s what happened to Johnson. When he heard about Musingku’s currency, he decided it was just too good an investment to keep to himself. Around 2012 he began pitching family friends and church acquaintances on the BVK.

Investors could get a piece of the action, Johnson told them, by opening up a BVK-denominated account via a website for the king’s own sovereign financial institution, the International Bank of Me’ekamui (IBOM), which was offering compound interest rates as high as 100 percent a month.

Lois Roose contributed $5,000 of her retirement funds, hoping to use the returns to support her foundation for the homeless and her church.

Carly Schaefer invested $150,000 from her late mother’s estate believing it was a secure foreign investment opportunity.

“You’re a Christian. I trust you,” Schaefer recalled telling Johnson, according to records from his 2017 criminal trial on a series of theft charges, in which he was later convicted.

Johnson told his clients that another economic meltdown was coming. Investing in the BVK scheme would protect them.

“So it was like, you know, let’s take some of this [money] and put it in a sock and bury it for a while,” he told the court in Iowa’s Carroll County.

”And then we’ll come back out… after the sun is shining again and the storm is gone.”

’I Saw the Growth of my Money, the Profit, I was Really Excited’
Resembling a spatter of deep emerald on a map of the South Pacific, Bougainville is a land of forests and volcanoes cursed by war and natural wealth.

Although the island is technically part of PNG, its 300,000 inhabitants are ethnically and culturally closer to the neighboring Solomon Islands.

In 1568, Spanish explorer Álvaro de Mendaña named the archipelago after the biblical King Solomon, believing he had discovered the source of the king’s legendary gold.

He wasn’t so far wide of the mark.

As an Australian colony, Bougainville became a central node in global commerce in the 1970s when the multinational Rio Tinto opened up Panguna, at the time one of the world’s largest gold and copper mines.

Despite the billions of dollars it generated, the mine provided little wealth for locals, while trashing the forest and rivers.

In 1988, fed up Bougainvilleans went into revolt.

Armed with old guns and Samurai swords left by Japanese soldiers defeated on the island in World War II — as well as a handful of mine vehicles converted into makeshift tanks — local independence fighters managed to quickly oust the mining company and the forces of a newly independent PNG.

In response, PNG put Bougainville under a naval blockade that sealed it off from the outside world. Imported goods, from medicine to canned food, disappeared from shelves.

Without imported fuel, locals built hydropower dams and modified cars to run on coconut oil. Money, an abstraction at the best of times, ceased to have meaning.

Public health experts estimate 15,000-20,000 people died during what locals call the Crisis, many from preventable diseases.

But while Bougainville’s modern economy evaporated, a young and pious man originally from Bougainville was getting fabulously rich nearly 1,000 kilometers away in the PNG capital, Port Moresby.

Noah Musingku and his brother founded an investment vehicle in the late 1990s, U-Vistract, that promised to double investor funds every month.

U-Vistract had all the hallmarks of a classic Ponzi scheme. Named after Charles Ponzi, who defrauded thousands of investors in Boston in the 1920s, Ponzi schemes promise artificially high rates of return to early investors — but they are actually being paid off with funds from later investors.

Such schemes inevitably collapse when too many investors demand redemption, or when the scheme fails to attract a sufficient number of new investments.

With Musingku flaunting his wealth across Port Moresby, and stories swirling of the prominent Papua New Guineans who had made money off the scheme, U-Vistract spread like wildfire throughout the South Pacific and parts of Australia.

In PNG, it is estimated that as much as seven percent of national gross domestic product was soaked up at the time into U-Vistract and other “fast money” schemes.

In Bougainville, the scheme’s explosion coincided with the end of the Crisis and the emergence of a tentative peace.

Naomi Sania, a market vendor in Bougainville’s capital, Buka, was one of legions of locals who joined lines to sign up.

She was amazed when the approximately $90 she invested had doubled within two weeks. Although she was able to take some of her money out, the temptation of continued gains was just too much.

“When I saw the growth of my money, the profit, I was really excited. So I just rolled on,” Sania said.

She watched as her balance grew on paper to about $12,500.

But then the payouts stopped. Like tens of thousands of others across Bougainville and the wider region, Sania would never see her money again.

Regulators shut down U-Vistract’s Australian operations in 1999 after finding it had deceptively taken about $600,000 from local investors. PNG’s government followed suit, revoking U-Vistract’s license to operate.

Musingku and his scheme were declared insolvent by a PNG court the following year. A court-appointed liquidator concluded at least $20 million to $30 million had moved through bank accounts related to the scheme before it collapsed.

King of The No Go Zone

Musingku was undeterred. Charged by PNG authorities with contempt of court for continuing to promote his scheme, he first fled abroad to the Solomon Islands, but was swiftly kicked out. Around 2003, he returned to Bougainville.

By then the island was mostly at peace and was formally run by an autonomous government of ex-rebel leaders. But near the abandoned chasm of the Panguna mine, a disaffected senior ex-rebel, Francis Ona, had staked his own claim to rule.

Musingku traveled to Ona’s breakaway region, known as the No Go Zone, and made him an intriguing offer: Ona would declare himself ruler of a supposedly ancient kingdom, Me’ekamui, that would be the official government of a fully independent Bougainville, and Musingku’s U-Vistract concept would become the basis for its financial system. Ona accepted.

When Ona died in 2005, Musingku gathered his followers and parts of Ona’s armed faction and moved to his ancestral village of Tonu, deeper in the No Go Zone.

In this new capital, he crowned himself king. But by then he was essentially broke, according to John Cox, an Australian social anthropologist who has studied Ponzi schemes in the Pacific.

Musingku ratcheted up his rhetoric in response. U-Vistract evolved from a mere get-rich-quick scheme into the promise of a holy revolution that would bring wealth and freedom to Bougainville.

Musingku began stringing along his still-unpaid followers with a story that he was “a massive reformer of the whole global financial system,” Cox said.

The pitch was that “as God’s plan is going to be revealed, and people are signing on to this all over the world… all the wealth that you see white people enjoying in the New York Stock Exchange or London or wherever — we’re going to have that.”

That sort of escalation is “classic in the psychology of cognitive dissonance,” Cox explained.

“Dial up the rhetoric, increase their outreach, really dig in rather than thinking ‘gee, this whole thing’s falling apart.’”

Musingku’s village of Tonu soon developed all the trappings of a pseudo-state, with its own royal palace and parliament made from wood, thatch, and corrugated metal roofing.

At its heart was also a clutch of buildings that he claimed were financial institutions — a central bank, a local bank, and a bank for international customers, the International Bank of Me’ekamui, or IBOM — that dealt in the BVK.

The threat this posed to Bougainvillean authorities was obvious. In 2006, a group of fighters aligned with the island’s legal government attempted to storm Tonu.

They killed four of Musingku’s bodyguards and wounded the king with a gunshot through his neck, but the raid was ultimately unsuccessful.

From Con Artist to ‘Cult’ Leader
Since then an uneasy peace has prevailed. Still officially a wanted man today, Musingku does not leave his royal territory, a loosely defined region with several thousand followers in the island’s south.

In 2019, over 98 percent of Bougainvilleans voted for full independence from PNG, which is due as soon as 2027. At this key moment, the government appears to have decided that picking a fight with an armed and aging conman is not in its interests, and has not pursued Musingku.

Left to his own devices for two decades, Musingku’s world has evolved into something often called a “cargo cult,” a controversial term coined to describe millenarian cultural movements that emerged in Melanesian islands in response to colonization and World War II.

Believers would mimic the rituals of a more technologically advanced society in the hope it would bring them actual cargo like food, goods, and technology.

Such movements have seen locals attempt to summon foreign riches by, for example, building fighter planes from wood, or radios from coconuts.

In some ways, Musingku’s mimicry of international finance fits the definition of a cargo cult, Cox said.

But the term is fraught with colonial baggage, he said. And after all, aren’t the West’s faith-based financial trends — from sovereign citizen schemes to cryptocurrency — their own form of cargo cults?

“There are all these ways of creating dark money that having an alternative form of sovereignty – at least in your head – facilitates,” Cox said.

Indeed, Musingku was adept at straddling these two worlds.

From the earliest days of his return to Bougainville, Musingku has forged ties with Westerners drawn to his vision.

One of the first was Jeffrey Richards, a self-styled royal who prefers to be called Prince Jeff. In the 1980s, he helped form a microstate in rural northern Australia called the Independent Sovereign Neutral Nation of Mogilno, based on early sovereign-citizen-style ideas.

He told OCCRP he was invited by Musingku to Bougainville in 2004 to help set up his new kingdom.

“He had the belief of sovereignty, but he didn’t know exactly how to go about it,” Prince Jeff told OCCRP.

“So I told [Musingku], you know, he needs to create his flag, create his postal stamps and then … [proclaim] sovereignty.”

Prince Jeff convinced two men — one of whom owned a Cessna private jet — to fly clandestinely to the airstrip near the abandoned Panguna mine.

The pilot was detained but Prince Jeff and the remaining passenger, his acquaintance “Lord” James Nesbitt, disappeared into the No Go Zone.

After two “mind-boggling” years in Bougainville’s interior, which included witnessing Musingku’s elaborate coronation, the pair were arrested for immigration violations in 2006 during a trip to the island’s capital Buka and swiftly deported.

One of Prince Jeff’s principal legacies was a piece of infrastructure that would allow Musingku to spread his financial gospel far and wide: a satellite internet connection.

In 2008, on the eve of the global financial crisis, Musingku used his new internet connection to launch IBOM’s website.

‘Like Tokens for Rides at a Carnival’

The man who truly set IBOM off as a global phenomenon was a retired electrical engineer from Texas, Benjamin Young.

IBOM appeared to be a perfect fit for an operation that Young co-headed, the Internet Catalogue Club (ICC), a network of websites that evoked both old-school coupon clipping and fringe anti-government ideology.

“Frankly, the entire global banking system is built on fraud,” Young told OCCRP in an interview.

Charging a $25 entry fee, the ICC allowed members to trade with each other using digital tokens, including ZCash, a pseudocurrency found by the U.S. Securities and Exchange Commission (SEC) in 2011 to have taken $4 million from investors without giving them the promised returns. (Young denied any wrongdoing, but was eventually barred by the SEC from associating with a securities broker or dealer. He and a co-defendant argued in court that ZCash was never meant as an investment and was intended for use inside ICC’s closed system, “like tokens for rides at a carnival.”)

Young’s ICC also offered members the opportunity to invest in obscure financial instruments that sovereign citizens often claim can be exchanged as legal tender, such as promissory notes, which are essentially legal IOUs, and international bills of exchange (IBOEs), a kind of legal document used in international trade.

The ICC was a place where members could easily sink their U.S. dollars

Elizabeth Baker