Financial Fraudsters

To look at her, you'd think she was someone's elderly aunt, maybe even grandmother.

She was married to a short, stout man who drove her work every morning and picked her up every night. They had no children. It was just the two of them.
They lived their lives like proverbial clockwork.

He was on disability due to an industrial accident that left him unable to work, yet able to drive.
At 8:45 every morning, he dropped her off in the parking lot, watched her walk in the door, then drove back home.
At 4:45 pm every day, he was back in the parking lot.
He always arrived 15 minutes early and listened to the car radio while he waited.
Then she exited the building, walked to the passenger door, opened it, leaned over and kissed him on his right cheek. Always the same thing every day.

She never seemed to change. She always wore flowered shirts, cardigan sweaters, long pleated skirts, dark nylon stockings and black Mary Jane's with a 1" square heel. She was the "loving old lady" out of central casting... with short silver curly hair, chubby pink cheeks and an ever present smile.

She brought plates of homemade cookies to work, decorations for the holidays and she gave extravagant gifts to co-workers, friends and her only living relatives, her sister and husband.

She was the book keeper for a company that manufactured metal parts.
She'd been there every day since it was started by two brothers -- nearly 35 years earlier. It had grown to more than 50 employees.
Day after day, she quietly came and went... cooking the cookies... and the books.

And what a secret chef she was!
No one realized she'd been skimming off the top for 20 of her 35 years with the company.
It wasn't until an IRS audit that the deception revealed itself.

She'd stolen more than $450,000 from the company and spent every cent of it.
Some money went to the little sun porch and swimming pool she added to the back of her house.
Some went to the Ethan Allen furniture she bought for her humble 2 bedroom ranch house with the sun porch and swimming pool out back.
Some went to the elaborate gifts she bought co-workers, family members and friends.
What was left went into the slot machines at a casino not too far from her home.
None of it went where it should have. To the IRS.

My family was the recipient of two of her gifts more than a decade and a half before her fraud was uncovered.
At that time, she was just the kind, elderly lady with a big heart and evidently, big budget.
I remember I looked at the expensive gifts she'd mailed across the country to us with the price tags still on them --- and thought it odd -- not only that she would send such expensive gifts to the family of one of her co-workers; but that she would want us to know what those gifts cost.
I wrote a thank you letter about her excessive kindness and noted her unnecessary, appreciated expense.

Then, years... states... lives.... parted.
And it wasn't until almost 16 years later that the IRS investigation uncovered her financial fraud. The money she was supposed to be paying them and others went into her pocket book.

I was shocked when I was told of her skimming, scamming and sentencing.
She was arrested, tried, got three years in jail and ordered to pay restitution on every cent she stole.

Her excuse was the one almost every one like her uses.
"I only meant to do it once and then pay it back. Then I did it again, and again... and fully intended to pay it back. Soon I was in too deep."

She did the jail time, but never paid back a single penny.
Instead, she and her husband declared bankruptcy, left the state and moved into a fifth wheel parked on her sister's property where they remain to this day.

Because of her actions and the unpaid taxes, the company she worked for also had to declare bankruptcy.
They closed their doors shortly after her conviction.
That, of course, meant all the employees who worked at the company also had nowhere to work.
Which mean their families also suffered.

The gifts she had given my family had long ago been given to others in our life travels.
No way to get them or give them back.
I am still bothered though, to this day, by how easily I accepted the expensive gifts without a clue where they really came from.

The effects of financial fraud are similar to the effects of a pebble tossed into a still pond.
When the pebble impacts, there's a ripple effect that causes individual rings to form from the center outwards.
With fraud, each ring represents lives affected and often ruined by the perpetrator of that fraud.

Who commits financial fraud?
Could be Bernie Madeoff or the kindly old lady accountant.
Could be the guy or girl you met on the net.
Could be someone you never met.
Could be an employee or your twin sister or your brother.
Could be the house cleaners you had for years who suddenly left town with a pile of cash you thought was secreted away.
Could be the house sitter you hired who got your mail and your ID.
Could be someone who targeted you -- just because you have money and they don't.

A few years back I worked a case for a friend whose ex-girlfriend stole his checks and wrote $40,000 worth -- the entire contents of his checking account --- while he was overseas for four months.
Because he discovered the crime at the four-month mark, the statute of limitations to contest a claim had expired according to his bank. He had three months to report such a crime and he'd get his money at back.
At month four he was just too late.
The best we could do was get her charged criminally, indicted and convicted on more than 30 counts of theft.
She too got jail time and restitution my friend will never see.

Today I talked with a friend whose sister was recently taken for 16k by a guy she barely knew and invited into her home.

And a few weeks ago I was contacted by another friend who believes our mutual wealthy elderly friend is being defrauded and targeted by his new younger and materialistic wife. We both think she will sooner or later try to kill him for his life insurance money once she's gone through all his assets and cash. She has literally shut the door to our friendship with him and keeps his family away.

I could write paragraphs about the financial frauds I have investigated or been privy to over the many years I've been at this business.
Suffice to say.... what I have learned from each and everyone of them is this:
Watch your assets. And tell others you care about to watch theirs.

In these hard economic times "everyone" is what fraudsters consider "fair game."
Even you.
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If you need a Private Investigator who is also a Forensic Accountant, just click on the title of this blog. It will take you to the website of my friend and favorite in the field, Mark Wilson who calls himself the "Forensic Bean Counter."