Valleyboy.scam

Kevin Yaeger struck it rich and partied with the prettiest boys in Silicon Valley -- until his lies caught up with him

Most afternoons, Kevin Yaeger could be found nursing a hangover from the night before with a glass of cinnamon schnapps, his favorite drink. He'd be wearing only his boxer shorts, unashamed of the unfurled rolls of flesh that liposuction had been unable to tame. Surrounded by piles of dirty laundry, scattered papers, condom boxes, and half-empty bottles of lube and beer, Yaeger would sprawl belly-down on his queen-size bed, chatting up venture capitalists on his cell phone. "This is gonna be big -- really big," he'd say. "I'll have my secretary get back to you."

There was no secretary in the nearly $4,000-a-month house Yaeger rented in the tony San Jose suburb of Los Gatos. There was a hot tub, though; a giant one that seated 12. A baby blue BMW convertible sat in the driveway. And every night, a party raged at 116 Old Adobe Rd. as rebellious teenagers from all over the Bay Area came to get drunk, get laid, and trash the place. Yaeger, who had a penchant for young gay men, went to 18-and-over nightclubs and handed out fliers to the cutest patrons -- the pretty, blue-eyed boys from the in-crowd, all wearing baseball caps and the latest Abercrombie & Fitch polo -- inviting them to private soirees that promised free booze and party favors like Ecstasy. As word spread, Yaeger's home was soon filled with the very people he'd always found attractive, yet had never before had a chance with. For Yaeger, it was the realization of the Silicon Valley dream.

At 27, he'd struck it rich in the dot-com gold rush. He had the monster house, the expensive car. He had been CEO of two lucrative Web-based companies even though he'd never gotten a college degree and had no experience in computers. In fact, a minimum-wage stint at McDonald's and operating a paper route for the San Jose Mercury News were his only credentials. Yet now he was wealthy, and cute guys wanted to be around him. Money was his confidence-builder. With it, he could play out a delayed adolescence and afford the trappings of what he always thought was the good life.

Convicted: Kevin Yaeger.
Anthony Pidgeon
Convicted: Kevin Yaeger.
The Last Trophy Boys: Chris Seguy and Kenn Sugiyama.
Anthony Pidgeon
The Last Trophy Boys: Chris Seguy and Kenn Sugiyama.
Bankrupt: Steven Hildreth.
Anthony Pidgeon
Bankrupt: Steven Hildreth.
116 Old Adobe Rd.: "Den of iniquity."
Anthony Pidgeon
116 Old Adobe Rd.: "Den of iniquity."

The only problem was that none of it was real.

In Santa Barbara, the über-rich Central Coast town where L.A.'s elite go to sunbathe, Yaeger was raised shamefully blue-collar. His mother, Stella Ray, worked payroll for a plumbing company and was a single mom to four kids by three fathers. Yaeger was the youngest, the result of an affair with a delivery truck driver. Life with his half-siblings wasn't easy. One of his brothers was physically abusive, Yaeger claims, using the guise of roughhousing to break his arm and inflict countless black eyes. That brother teased Yaeger about not having the same father, telling their friends they weren't really related.

Yaeger also says a family friend sexually molested him when he was a young boy. He didn't tell anyone, but blamed his absent father for it. "I thought if he was around, maybe it wouldn't have happened."

Yaeger's mom worked a lot and didn't have much time to spend with her children. They struggled financially, and at 11, Yaeger started earning his own money with a paper route. "I had to support myself for things I wanted as a kid," he says. "I grew up poor and promised I would never live like that again."

When he was 14, Yaeger's family left Santa Barbara when his mom was laid off. They lived a few years in various East Bay cities before settling in San Jose. Yaeger bounced between schools. Socially, he was a loner. "I never fit in, and wasn't happy. Between being a heavy kid and stuttering, I was used to being made fun of. I hated school," he says. "I always had a hard time making friends and dating when I was young. I wasn't even sure if I was gay or straight."

As Yaeger was finishing high school, his older sister announced to the family that she was a lesbian. It was a shock to everyone, especially Yaeger, who was thinking of coming out, too. Their mother did not take the news well, which bothered him. "She just flipped out and had a really hard time dealing with it," he says. "So I kept quiet."

But for the first time ever, Yaeger was beginning to find friends -- other young gay and questioning men like himself -- through computer bulletin boards that, in the early 1990s, were the precursor to the Internet. They formed a coffee club that met at a cafe near DeAnza Community College in Cupertino where many in the group, including Yaeger, took classes.

Yaeger tried hard to impress his new friends. He was a big spender compared with those living on student budgets; he'd insist on picking up the tab for everyone's meals and drinks. He drove the fashionable car of the time, a new, sporty Honda del Sol. His apartment had real furniture, not milk crates, and he always had the latest and most expensive stereo, TV, and computer equipment. "The big question was, "How does Kevin get his money?'" says original coffee club member Mark Schwab. "He was very secretive and never answered any personal questions."

Depending on whom he talked to, Yaeger explained his cash flow by saying that he had inherited a hefty trust fund from his deceased father or that he had won a lawsuit resulting from botched laser eye surgery. "Kevin was good at not having more than two people know the same thing, which made it impossible to know what was true," former coffee regular Steven Hildreth says. "But he always had the ability to come up with money no matter the circumstance, so I had no reason to question it."

It was true that Yaeger's father had died, though there was no inheritance. No one knows for sure where Yaeger got his money at the start, before his Internet companies were up and running. Many friends have their theories. And investigators -- who are still working to solve the mysteries surrounding Yaeger's career of deceit -- do too.

One thing was certain: Yaeger was -- and is -- obsessed with youth and beauty. "The type of guy I'm attracted to is not attracted to me," he says. "And I understand how they feel, because I wouldn't want to date someone who is heavy or older, either."

Everyone in the coffee club faced the same dilemma: The transition into adulthood was hard enough without the added complexities of being gay, especially at a time when society was much less accommodating. But Yaeger didn't grow up. "Kevin can be sweet, funny, and nice, but there is a dark side to him. I haven't seen someone so insecure since Charlie Sheen in Wall Street," Schwab says. "He wanted status and to be a player. The more things he got, the more confident he became. That was his passion: more money, bigger house, better car, more boys."

All around him in Silicon Valley, Yaeger could see men his own age founding high-tech companies, minting millions, being lionized as celebrities on the covers of magazines. Everyone was getting rich. Jerry Yang and David Filo of Yahoo! were heroes of the new economy. It was hardly surprising that Yaeger wanted to make it in a culture that held up young men who were basically geeks as something akin to rock gods. What was surprising was how far Yaeger was willing to go. "We always knew he was a wannabe," Schwab says. "But not a crook."

It turned out Yaeger's dot-com companies, Priority Web and Cyberpop, didn't do anything -- or, at least, nothing very legitimate. And when those endeavors didn't adequately support his lifestyle, he resorted to check kiting and counterfeiting schemes to raise quick cash.

In January, he was convicted of grand theft by the Santa Clara County Superior Court for stealing nearly $40,000 from the computer company Acer America using phony invoices. He was sentenced the same month to a one-year jail term in Milpitas. Yaeger celebrated his 28th birthday last month in the L.A. County Jail. Prosecutors in Los Angeles extradited him to face charges that he set up a fraudulent Acer bank account there in which he deposited more than $100,000 in bogus checks.

Yaeger pled guilty to that felony last week. How much jail time he serves will depend on whether he can pay restitution. And investigators have intimated there will be additional federal charges because Yaeger's Internet ventures crossed state lines.

The party house on Old Adobe Road -- nicknamed "the den of iniquity" by Los Gatos police because neighbors complained about the activity there so frequently -- doubled as Yaeger's company headquarters. Young men earned their keep at a phone bank, soliciting customers to sign up for a new Internet service provider that promised unlimited access to the net for $9.95 a month, but didn't really exist. The same angry customers who found their attempts to dial into Priority Web somehow never resulted in the high-pitched warble of a modem connection also allege their credit cards were billed not $9.95 a month, but $99.95. Conveniently for Yaeger, companies like Visa and American Express don't bother to investigate dubious charges under $100.

"He's got his finger in every type of fraud imaginable: false impersonation, bank fraud, wire fraud, money laundering, and plain old grand theft," says James Wagner, a San Jose police detective who followed Yaeger's money trail for nearly two years. "He's a one-man crime wave."

Even Yaeger's mother, Stella Ray, ended up serving seven months for helping her son embezzle from Acer, where she worked as an accounts payable supervisor. Yaeger admitted stealing invoices from his mom, filling out fake work orders, and returning them to her inbox. Ray processed and issued the checks, which were sent to addresses belonging to her son, though she says she did so unwittingly. The family's unfortunate involvement didn't end there, either: Yaeger leased a half-dozen cars for his trophy boyfriends to drive using his brother's name.

Then there were Yaeger's friends. He convinced several of them to set up credit card accounts that he was authorized to use, telling them he had an Internet business plan that would turn his and their lives around, if only he could circumvent his bad credit. All of them believed their lent credit would be used to purchase the computers, software, and office supplies Yaeger needed to get his business started, and that he'd reimburse them and share a generous piece of the profits.

But Yaeger wasn't buying photocopier paper and mouse pads. He was using the cards to charge flights to Hawaii and Tahoe with his young boyfriends, to fund untold wining and dining -- and even to pay for two liposuction surgeries for himself.

Luckily for him, Yaeger's friends badly wanted into the world of trophy boys and glamour to which they thought he could provide access. Yaeger used his older friends' money to attract more boys, giving people like Steven Hildreth -- who at age 33 still tries to pass as a college-aged student -- more incentive to keep investing. Hildreth had to file for bankruptcy after Yaeger's indulgences brought the final total on his Visa and American Express balances to $118,000. "I was lonely and had no one to hang out with. I was depressed and vulnerable," Hildreth says now.

Sometimes, even the trophy boys became trapped in Yaeger's machinations. Most of them simply used Yaeger for his generous parties and trips, without having to give anything in return other than their attractive presence, which Yaeger then used to increase his own cachet. They were, in effect, arm charms. But for anyone in his mid-20s about to hit trophy boy retirement age -- because there will always be younger, cuter 19-year-olds -- the game changed.

When ex-boyfriend John Williams discovered bank and credit card statements that suggested Yaeger had stolen his identity, he called police. By this point, Yaeger's influence over his band of friends was waning, though he didn't give up in his attempts to guilt-trip them into silence. "You hurt me beyond belief by having me arrested," Yaeger wrote to Williams in an e-mail. "I don't know what possessed you to take the action you did. Someday you will find you regret it ... even through good times and bad, I never stopped loving you."

Now that Yaeger is in jail, he's not exactly apologizing to friends like Hildreth and ex-lovers like Williams, opting to portray himself as a victim, too. "It's not that Steven never benefited from my crimes and my life," Yaeger says. "Yeah, I did some stuff against him, but not to hurt him. I was good to him. I took him on trips and spent a fortune on him. All through our friendship, he rode on my wing."

Says Yaeger of Williams: "John is the one who turned me in. But when I went out of his life, his life went downhill and he blames me for it. He was never willing to be the person I needed. He didn't love me as much as I loved him."

Lamenting his birthday in the L.A. County Jail, where he hates the food, Yaeger says he doesn't deserve what's happened to him. In fact, he puts much of the blame on a psychic he frequented while living in Los Angeles. "Nancy," he says, turned out to be a witch who cast a spell on him. "It may sound far-fetched, but I swear, ever since I started seeing her no matter what I touch goes bad. She got me to do things I wouldn't have remotely done before. It's like my mind wasn't thinking," he says. "I'm not claiming I'm innocent. There are just extenuating circumstances with my crimes that people don't understand."

A pacifier rolls across the back seat of Chris Seguy's car as he turns the corner on his way to work as an administrative assistant at a San Jose credit union. Seguy was out clubbing until 4 o'clock the night before. "I love E!" he says, referring to Ecstasy, which sometimes requires him to use the fluorescent green pacifier to soothe his heightened senses. (At raves, club kids often wear the baby utensil on a necklace.)

If the thin blonde hadn't met Yaeger in an AOL chat room -- where Yaeger used the handle "BoyzsR4ME" -- they might have met at an 18-and-over nightclub like "Faith" in San Francisco or the now-closed "JR's" in Walnut Creek. For a while, thanks to Yaeger, Seguy's nightlife didn't have to be interrupted by a boring credit union job. Yaeger recruited the 21-year-old -- one of his last trophy boys -- to work for his Internet venture, offering free rent in his Old Adobe house. "It felt like he wanted to hire me because I was cute," Seguy says. "But I was excited because I love computers."

Seguy and his boyfriend, Kenn Sugiyama, whom Yaeger also hired, found there wasn't much of a workload on Old Adobe Road. They were supposed to be customer service representatives. But when people called to complain that they couldn't dial into the Internet via Priority Web, there wasn't much either Seguy or Sugiyama could do. So they stopped answering the phone, especially as the callers became increasingly irate. Yaeger hadn't paid them anyway. But they didn't need any income. Everything they wanted -- food, a place to sleep, drugs -- was already provided. "It was a party pretty much every night," 21-year-old Sugiyama says.

"Most of our friends are cute, so he wanted us around to attract those people to the crowd," Seguy says. "He wanted to have his little sugar boys, but I can't imagine why anyone would get near him or want to touch him, except for the money."

The final days of Yaeger's Silicon Valley party house and Internet company were desperate ones. Yaeger had convinced longtime friends like Hildreth as well as his own brother, John Pochop, to become business partners in a new venture that would resell Internet access to small service providers for a healthy profit. Yaeger was under pressure to raise nearly $100,000 to pay restitution in his previous fraud cases so he could strike a deal to avoid jail time. He was secretly making appearances in courtrooms in San Jose and Los Angeles, getting continuance after continuance. Hildreth and Pochop were aware that Yaeger had had some legal problems in the past, but he'd assured them everything had been resolved. No one knew the extent of Yaeger's troubles until one trophy boy thought to go to the courthouse and read Yaeger's file -- all 300 pages of it.

Martin Hickey also read through Yaeger's business contracts and made calls that led him to believe the numbers weren't adding up. He told Hildreth and Pochop that Yaeger had found a way to skim the profits while saddling them with the liability for hundreds of thousands of dollars of impending debt. They immediately shut the company down, foiling Yaeger's chances of getting the money he needed to avoid jail.

When the three men confronted Yaeger about what they had discovered, he went into a rage. "When Kevin gets pissed off, he looks like a charging bull," says Seguy, who hid in his room as the others tried to dismantle the company's computer network while wrestling with Yaeger.

"It was like World War III: Kevin threw a printer at us, but he missed and it smashed on the floor," Hildreth says. "He was in sheer panic."

Locked in his room, Seguy could hear screaming and sounds of equipment being thrown around. Yaeger's brother was especially incensed: "If it's true what they are saying, you've put the family in danger!" Pochop yelled. "What about Mom?"

At a scheduled court hearing in San Jose the next day, Yaeger had no more outs. He was taken into immediate custody.

When Yaeger didn't come home and word spread he had been jailed, the goodies on Old Adobe Road were up for grabs. "All these people showed up and they were like cockroaches, scurrying off with clothes, food, TVs, stereos, furniture, everything," Sugiyama says.

In the aftermath, Seguy and Sugiyama were the only ones left in the near-empty house. They faced eviction, since Yaeger had not been paying the rent. "When the illusion we were living was shattered in just 24 hours, it really hit us how alone we were without Kevin," Sugiyama says. "It creeped me out. I didn't realize how dependent I was on him until everything was taken away. That house was the glue to so many lives, and once Kevin was gone, it all unraveled."

Huddled around the fireplace, Seguy and Sugiyama were trying to remain at 116 Old Adobe Rd. as long as they could. The heat, power, and phone service had been cut off, but they had nowhere else to go. A January cold snap made the darkened rooms, the shell of Kevin Yaeger's imaginary dot-com empire, all the more uncomfortable. So the boys burned newspaper to keep warm, and smoked to keep their spirits up.

Seguy's cell phone rang. The battery was low and the connection unclear, but the voice was unmistakable.

"Hey guys, it's Kevin!"

He was calling from the Elmwood Correctional Facility in Milpitas. Collect. Seguy accepted the charges and listened as Yaeger reassured him.

"I miss you guys," he said. "Don't worry, I'll fix everything. When I get out of here, I've got big plans."

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