Couple Accused of Welfare Fraud After Purchasing an 83‑Foot Trumpy Yacht

Colin A.J. Chisholm III and his wife, Andrea, cultivated the lifestyle of the wealthy: an 83‑foot Trumpy motoryacht, upscale homes in Minnesota and Florida, and a public image that included claims of Scottish nobility. Their luxury life ended when fraud investigators tied the couple to alleged misuse of public benefits. Authorities say the Chisholms collected $167,420 in Minnesota public assistance and also received welfare benefits in Florida; investigators later extradited them from the Bahamas to face charges.

The Hennepin County attorney’s office says the Chisholms — who styled themselves as “Lord and Lady Chisholm” — were located in the Bahamas after more than a month in hiding. They were extradited on March 31 after local police in Freeport confronted the couple on Grand Bahama, determined their visas had expired, and sent them with their 7‑year‑old son and dog on a Bahamas Express ferry to Fort Lauderdale. Broward County deputies arrested the pair as they disembarked at Port Everglades; the child and the family dog were placed in the custody of relatives.

Hennepin County State’s Attorney Mike Freeman described the Chisholms at a news conference as “fraudsters of the first degree,” and his office has charged them with wrongfully obtaining more than $35,000 in public assistance — a felony offense for which he says he wants to see them serve prison time.

The criminal complaint filed in Hennepin County District Court lays out a broader financial picture: while the couple received medical, food stamp and cash assistance in Minnesota and Florida, they allegedly controlled bank accounts that received $2.63 million in deposits from January 2005 through April 2012. The complaint also accuses them of failing to truthfully disclose assets on benefit applications and, for a period, receiving assistance simultaneously from both states.

Colin Chisholm, 62, is listed on a company website as chairman, president and CEO of TCN Networks, a Miami‑based firm that claims to offer satellite television and broadband services in the Caribbean. The website provides little information on how customers could actually buy those services. In a 2006 deposition, Chisholm told a court that TCN had 28 to 30 shareholders and that five investors had put more than $2.25 million into the company, most of that investment occurring in 2006. Andrea Chisholm, 54, ran a kennel that bred and sold pedigree dogs and reportedly produced a Westminster Kennel Club winner.

The complaint recounts how the Chisholms’ yacht purchase unfolded soon after applying for benefits in Minnesota. “Just weeks after applying in Hennepin County for welfare benefits, Colin Chisholm began negotiating the purchase of an 83‑foot Trumpy yacht then known as the Wishing Star,” the filing states.

Richard Ross, a Stuart, Fla., business executive who sold the Trumpy to the Chisholms, told reporters that Chisholm told him he lacked sufficient funds to buy the yacht. The complaint includes a cited Oct. 15, 2004 email in which Chisholm said his company had used “most of [his] available cash up to this date, around $6.2 million,” while claiming control of “about $30 million in network television advertising on CNBC.” The email reportedly showed Chisholm exploring “creative financing” to complete the yacht purchase.

According to the complaint, the couple agreed in January 2005 to pay Ross $1.2 million for the Trumpy: a $220,000 down payment, monthly payments of $7,500, and a $157,000 lump sum due March 15, 2005. Ross says Chisholm claimed the boat had been built by his father and that he had grown up on it — assertions Ross could not confirm. Ross recalls Chisholm appearing emotionally invested at closing and later describing lavish onboard entertaining with butlers, stewardesses and chauffeurs.

The yacht, renamed Andrea Aras after Andrea and Chisholm’s mother Sara (Aras is Sara spelled backward), quickly became a point of contention when payments fell behind. Ross says Chisholm issued two checks for $50,000 that bounced; he later received certified funds to cover those checks, but subsequent missed payments allowed the boat to be tracked, located and ultimately seized. Using satellite imagery, Ross followed the vessel from a Savannah dock to Lighthouse Point, Fla. After foreclosure proceedings, the U.S. Coast Guard and U.S. marshals seized Andrea Aras on Dec. 17, 2005. The Chisholms engaged in a prolonged legal fight in federal court and the 11th Circuit to regain the yacht, but they lost and Ross resold it.

The unraveling of the couple’s welfare claims intensified in early 2012, when Medica Insurance investigators received a tip that the Chisholms were improperly receiving taxpayer‑funded health care. At that time, the family was living in a lakeside rental in Deephaven, Minn., paying $2,750 per month, and sharing the home with Andrea’s grandmother, according to the complaint.

When applying in 2004 for Minnesota health care, the couple stated they lived with Andrea’s mother in south Minneapolis, had no employment income and claimed no stocks, vehicles, bank accounts or other assets. By contrast, the complaint says the defendants told potential TCN investors they controlled assets totaling $97,366,926.27. Investigators also allege that between January 2005 and April 2007 the couple resided in Florida — where their son Colin was born — while collecting cash, food support and medical assistance from Florida programs and simultaneously receiving benefits from Minnesota. “This is a con worthy of that old movie … The Sting,” prosecutor Freeman said.

With investigators closing in, the complaint alleges that in September 2013 the Chisholms “cashed a check and obtained $120,000 in one‑hundred‑dollar bills” and disappeared. On April 3, the couple appeared in Broward County Circuit Court and waived their right to fight extradition to Minnesota for trial on the fraud charges.

Today the former Andrea Aras is home‑ported in South Carolina under new ownership, according to James Moores of Moores Marine, a family business that specializes in Trumpy restorations. The yacht, which has sailed under several names including Aras, Pintail, Achastes and Wishing Star, is one of only two built on the 83‑foot Trumpy hull and the only one laid out as a cruiser. Moores noted that the vessel had undergone a roughly $2 million restoration before Ross purchased it and called the yacht “a classic, classic yacht.”

June 2014 issue