The incredible multi-million dollar F1 buyout that never happened

When Honda looked to sell off its Formula 1 team, Ross Brawn and Nick Fry courted a man named Achilleas Kallakis who promised millions to take over the operation.

But Brawn and Fry had a bad feeling about their investor…

It turns out they had spotted something even the world’s major banks had missed.

Honda F1 sale attempts take dark turn

Honda’s attempts at F1 stemmed back to the 1960s, but its modern history as a team and not just an engine manufacturer began when the Japanese manufacturer bought out the British American Racing team at the end of 2005 to stage its own attempt at the Championship.

With driver Jenson Button behind the wheel, Honda took its first victory at the 2006 Hungarian Grand Prix; the following year, Ross Brawn signed on as team principal.

But as the 2008 bankruptcy of Lehman Brothers, an American financial services group that had once been deemed “too big to fail,” began to reverberate throughout the world, Honda executives got scared.

They decided to quickly withdraw from Formula 1 as a way to avoid throwing away its cash. Honda was prepared to simply kill the team as it stood, but Brawn and the team’s chief executive Nick Fry managed to convince Honda to wait just long enough for them to find a buyer.

Interest naturally poured in when they announced the sale of the Honda team in December of 2008, and among the many prospective buyers was one man named Achilleas Kallakis, who claimed to be a billionaire shipping owner who also allegedly held the title of “Ambassador of the Republic of San Marino to the Sultanate of Brunei,” Crispian Besley writes in his book ‘Driven to Crime’.

Odd titles aside, Brawn and Fry agreed to meet Kallakis at the latter’s offices in London, where it appeared as if letters from charities, politicians, art galleries, and more had been casually left on a coffee table.

The initial meeting went well, and Kallakis soon after came to visit the team’s base in Brackley which required the clearing of the staff parking lot to fit Kallakis’ massive helicopter.

After that came lavish dinners and swanky parties, but for Brawn and Fry, something just didn’t sit right. In his book, ‘Survive, Drive, Win’, Fry noted that he and Brawn had been struck by Kallakis’ off-hand remark that he couldn’t believe the two men were “stupid enough” to pay UK taxes.

Their odd feeling persisted as Kallakis gave them a tour of his art collection; while neither man felt capable of determining the authenticity of the paintings in question, both Brawn and Fry found it strange that this one man could have such an impressive collection.

Doing their due diligence, Brawn and Fry hired an investigator to uncover more about Kallakis’ past – and asked Sir Jackie Stewart to mention their new friend to the King of Greece, who should have known a supposedly high-ranking member of his country.

Stewart reported back that the King of Greece didn’t seem to know Kallakis, but by then, Brawn and Fry had received two letters from what purported to be two different people vouching for Kallakis. The wording of the letters felt uncomfortably similar.

And then came the report from the investigators: there was no information about an Achilleas Kallakis out in the world, but there was a report about a gentleman named Stephan Kollakis, who had been convicted of selling false British manorial titles to Americans.

Not only did Kallakis deny the claims; he also instructed Brawn and Fry to craft a more flattering report to send to Honda, which would have set him up as the ideal buyer.

Brawn and Fry refused, washing their hands of the affair — and perhaps feeling grateful that they’d done their digging.

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The two men were likely even more relieved when the true nature of Kallakis’ fraud came to light. Nicknamed “Britain’s most successful serial confidence trickster,” Kallakis was responsible for the largest-ever mortgage fraud in the UK, amounting to over £760 million in illegally earned funds.

Alongside an accomplice named Alexander Williams, who was largely responsible for producing fraudulent documents (such as the odd letters that Brawn and Fry had received), Kallakis claimed to be related to an oil and property magnate, which enabled him to defraud banks into giving him mortgages on offices with inflated values.

Essentially, Kallakis purchased high profile properties throughout the United Kingdom and secured loans from banks by claiming that a Hong Kong property company was willing to pay heaps of money up front as a guarantee against tenant defaults.

As Crispian Besley writes in Driven to Crime, Kallakis was able to “wine and dine” the bankers into complete confidence in him, to the point where they didn’t even directly reach out to the Hong Kong company. (Unsurprisingly, that company would claim in court that it had no idea who Kallakis was, and that it had not engaged in any dealings with him.)

The whole ordeal ultimately convinced Brawn to simply invest in Honda’s former team himself; in 2009, Brawn GP took Formula 1 by storm, with its drivers winning eight of that year’s 17 races. Driver Jenson Button took the World Drivers’ Championship, and Brawn took the World Constructors’ Championship. At the end of the season, Mercedes-Benz bought out the team.

Reflecting on the dealings with Kallakis in his book, Nick Fry wrote: “In retrospect it seems surprising that we did not share our concerns with the police, but at the time, we had no grounds to suspect that he was engaged in wholesale criminal activity.

“It also seems extraordinary, looking back, that we were fairly quickly able to rumble Kallakis and rule him out of doing business with Honda, whereas several major European banks, who lent him hundreds of millions of pounds, failed to adequately investigate him, to their considerable cost.”

For his crimes, Kallakis was stripped of his assets and sentenced to seven years in prison; one lawyer appealed the decision, not to reduce the sentence, but to increase it.

As a result, Kallakis got four more years behind bars.

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