Fast money: Car device seller's scheme unravels

We had paid $1900 to have Dennis Lee's gas-saving device installed in our car.

Mechanic Sam Burlum told us we would get incredible gas mileage, 96 miles-per-gallon.

Could it be true?

We brought the car back to that government-approved lab and manager Robert DePalma for two more road tests.

Robert DePalma: We got no significant difference in anything.  Fuel economy, emissions – basically what it was last week, without the device installed.

Thirty-four miles per gallon before, 34 miles per gallon after, and no change in emissions.

So we didn't get the mileage Dennis Lee bragged about.

Dennis Lee in a promotional video, discussing HAFC: It is guaranteed to increase your fuel mileage by 50 percent or more.

It was no surprise to automotive expert Mike Allen, except when we showed him the bill.

Chris Hansen: It comes to $1,904 – we got the cash price discount.

Mike Allen: Ouch.

Chris Hansen: What did we get for our $1,904?

Mike Allen: Taken, you got taken.

Chris Hansen: So how would you describe this device?

Mike Allen: It's a scam.

Chris Hansen: Plain and simple?

Mike Allen:  Bogus, yeah.

Allen says Lee's device doesn't make nearly enough hydrogen to make a difference.

So why do so many go for it?

Mike Allen: There's one born every minute.  People want to believe that they can attach some gadget to their car, that they can pour some sort of pixie dust into their gas tank and get better fuel economy.

Chris Hansen: Yet he sells these things for thousands of dollars.

Mike Allen, laughing: Is this a great country or what?

What we found out about Dennis Lee is that over the years, he's gone from one end of the country to the other, touting much more than just his gas saving device.

Dennis Lee: The reason why we believe that nothing is impossible is because believe that to god nothing is impossible.

He's been part preacher, part salesman – a man who pitches things he says can change the  world.

Dennis Lee: A jack hammer that doesn't make noise.

Dennis Lee: Tires that never, ever go flat.

Dennis Lee: Cameras that can look through six feet of concrete wall.

Lee has even pitched an all-purpose motor that can run on virtually anything.

Promo narrator: Imagine running your engine on pickle juice, Coke, Pepsi, or anything liquid.

Dennis even inhaled what he says is pollution free exhaust.

Promo narrator: Now for something truly amazing. He will take deep breaths and will not cough.

Peter Sullivan: He had these inventions that would make a better world

In the mid-1990s, Peter Sullivan bought a Dennis Lee dealership to sell yet another of his inventions – a free-electricity machine.

Peter Sullivan: He was trying to bring together people who were motivated, who could invest with it, and then we would make money by doing good things.

But there was a hitch. While Lee used a demonstration model – there seemed to be a problem delivering the real thing. It was Sullivan's wife who smelled a rat.

Peter Sullivan, laughing: She had the intuition that this was a scam, to stay away from it. In my idealism, I didn't listen.

He says he never saw his money again and never actually received a working model of the free-electricity machine.

As for Lee, he's gone from one miraculous claim to another. He's even pitched a classic scam – one that's as old as the hills, the so-called perpetual motion machine.

Dennis Lee speaking at a convention: Could I show you a perpetual motion machine? Yes indeed, I do believe in perpetual motion machines.

Bob Park, University of Maryland Physics professor, author: He couldn't possibly believe

Video   Challenged by the laws of science Physicist Bob Parks explains what upsets him about Dennis Lee's gas mileage device. Dateline NBC

these things. He was a swindler from the start and I think he enjoys it. Among the most fundamental laws is the law of conservation of energy.  A perpetual motion machine obviously violates that.  So, that just isn't going to happen.

How has Lee been able to pull off all his bold claims? Well, he hasn't always been able to.

I have the plea agreement.

According to California Department of Prison records office: Admitted to prison March 17, 1993, parolled April 29, 1994, discharged April 29, 1997. So, he served just over a year in prison.

In California in 1990, Lee pleaded guilty to eight felony counts stemming from the marketing of one of his business opportunities. He served just over a year in prison.

At one time or another, he's been prosecuted or sued in at least nine states for violating consumer protection laws: California, Washington State, Maine, New Mexico, Kentucky, Alaska, Vermont, Idaho, and Oregon.

Bob Park: He's broken a lot of laws, but he hasn't broken the laws of Physics yet.

Judging from our test results, Lee’s latest gas-saving device hadn't gotten our Honda any increase in mileage either.

So, we had some questions for Sam, the mechanic who installed the device, and for Dennis Lee himself.

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