Fraud Friday – “Office Space” Scheme Comes to Life at Microsoft

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Anyone who has ever worked in an office environment is familiar with the very-specific, um, peculiarities of working in close quarters with a bunch of other hominids wearing uncomfortable clothing and engaging in forced camaraderie.

Having grown up very much working class, I found that the quasi-white-collar office environment is way different than a blue-collar setting in a myriad of ways, some better (I’m telling you, most people don’t properly appreciate the miracle of indoor climate control), and of course, some worse (don’t get me started on “teambuilding” exercises. In jobs where you do real work, that’s called Getting Shit Done.) I just don’t think humans are well-suited to being confined to little artificial physical boxes and staring at glowing screens all day – it makes us slowly go insane.

Nobody captured the bizarre, utterly farcical nature of the late 20th century western office workplace like Mike Judge did with his cult-classic film Office Space. Having been a “knowledge worker” for 15 years now, I can say with total confidence that I have yet to work in an office where the employees don’t know most of the film’s dialogue by memory. It’s as if Judge and his writing and production team had a camera in almost every Dunder-Mifflin-esque office in America in the late 1990’s. So much resonates: The clueless boss, the soul-crushing administrivia, the utterly unstoppable inertia of pointless bureaucracy. If by some twist of fate you haven’t seen this movie, stop what you are doing and go find it and watch it. Highly recommended.

[Spoiler Alert]

In one of the main plot beats of the film, protagonist Peter Gibbons (Ron Livingston, playing the role of a lifetime), and his much-maligned office drone buddies Michael (Bolton!) and Samir, are discussing how to achieve financial independence and thus freedom from the soul-sucking hell that is Initech, their blandly malevolent employer.

Peter confides in his colleagues that he’s developed software code that can take the “fractions of a penny” from various financial transactions that Initech’s software manages, and diverts those micropayments into his own personal external bank account. Hilarity and moral dilemmas ensue (seriously, go watch the movie again).

The thing that always struck me about that plot element was how absolutely PLAUSIBLE it seemed. Granted, I’m no software developer, and I know that any IS security person will bore you to death with the 3,497 internal controls that every software suite contains to ensure that such a scheme is impossible in the “real world,” and yet, here we are…

https://komonews.com/news/local/jury-former-microsoft-engineer-stole-10-million-in-digital-fraud-scheme

SEATTLE – A former Microsoft software engineer was convicted Tuesday of 18 federal felonies related to his scheme to defraud Microsoft of more than $10 million, said U.S. Attorney Brian T. Moran.

Volodymyr Kvashuk, 25, a Ukrainian citizen residing in Renton, worked first as a contractor at Microsoft and then as an employee from August 2016 until he was fired in June 2018.

After a five-day trial in U.S. District Court in Seattle, Kvashuk was convicted of five counts of wire fraud, six counts of money laundering, two counts of aggravated identity theft, two counts of filing false tax returns, and one count each of mail fraud, access device fraud, and access to a protected computer.

He faces up to 20 years in prison when sentenced in June by Judge James L. Robart.

According to records filed in the case and testimony at trial, Kvashuk was involved in the testing of Microsoft’s online retail sales platform, and used that testing access to steal “currency stored value” such as digital gift cards.

Kvashuk resold the value on the internet, using the proceeds to purchase a $1.6 million lakefront home and a $160,000 Tesla vehicle, court documents say.

As the thefts escalated into millions of dollars of value, Kvashuk used test email accounts and passwords associated with other employees, according to the case file.

Kvashuk attempted to mask digital evidence that would trace the fraud and the internet sales back to him. Kvashuk then filed fake tax return forms, claiming the money had been a gift from a relative, court documents show.

In closing arguments, Assistant U.S. Attorney Siddharth Velamoor said Kvashuk “hid behind his colleagues’ names … dripping fraud and deceit every step of the way. This is a simple case – anyway you look at it, this is a crime of greed.”

Kvashuk testified at trial that he did not intend to defraud Microsoft. He claimed to be working on a special project to benefit the company.

That testimony was “a house of lies on top of a previous house of lies,” Assistant U.S. Attorney Michael Dion told the jury.

The jury deliberated about five hours before returning the guilty verdicts.

From KOMO TV in Seattle, Washington

Well, I guess they’ve got bigger things to worry about out in Washington State than a Ukrainian hacker kid, but nevertheless, the audacity of the scheme is somewhat noteworthy. Look for many more of these to come in the future.

Have a great weekend, and try not to catch COVID-19, folks!

 

Fraud Friday:Cross-country road trip, Guns N’ Roses show and phantom dinner guests turn up in Cal State San Marcos audit

Auditors and fraud investigators are the (too often) unsung heroes of organizations. They take fragmentary, incomplete evidence and through painstaking hours of analysis and investigation, develop and report on a vast array of improper acts. Their reports, when acted upon, serve both a detective and preventive purpose against fraudulent activity.

Last week, the excellent professional audit staff at the California State University Office of the Chancellor released a comprehensive investigative report detailing what can only be called an egregious misuse of public funds. It was heartening to see that the report generated a significant amount of media attention. From the San Diego Union-Tribune:

A former Cal State San Marcos dean submitted dozens of fraudulent hospitality claims, filed duplicate expense reports and made up dinner guests to collect improper reimbursements, a long-awaited investigation released Thursday concludes.

On one day he attended an NFL game and watched a Guns ‘N Roses concert, calling it college business, the report said.

In total, Michael Schroder racked up at least $41,000 worth of unallowable expenses between July 2017 and June 2019, investigators at the California State University Chancellor’s Office said.

His dismissal by the university was announced late Wednesday.

“We investigated allegations that the dean of extended learning at California State University, San Marcos inappropriately used his expense account for personal meals and events, claimed business expenses for meals with individuals with whom he never met and spent excessively on international travel,” the report states.

“We substantiated all of the allegations.”

The 28-page investigative findings lay out a sweeping breach of Schroder’s fiduciary duty to safeguard and steward public funding. But the CSU report also limited its review to the former dean, who was not alone in spending university money on lavish meals, personal drivers and five-star resorts.

The San Diego Union-Tribune reported last year that former President Karen Haynes and several other senior administrators also stayed at foreign hotels costing as much as $760 per night, hired chauffeur-driven limousines and used school resources for expensive dinners and fine wines.

The Chancellor’s Office declined to answer questions Thursday about why spending by other Cal State San Marcos administrators was excluded from its eight-month investigation — or whether Chancellor Timothy White would seek to recover any of the allegedly misspent funds.

Cal State San Marcos spokeswoman Margaret Chantung said in a statement that the campus’ own investigation had included a review of one year’s worth of spending by Haynes and other administrators.

“The scope of the (Cal State San Marcos) internal review included all reimbursements from vice presidents and presidents during the 2018-19 fiscal year,” she wrote. “While we discovered instances of travel spending that fell outside CSU policy, we did not find any evidence of fraud.”

She also said school officials have not decided whether to try and recoup any funds from Schroder — or others — or whether the university would refer the case to criminal prosecutors.

“We will be reviewing all of our options,” she said.

Schroder has declined to respond to multiple requests for interviews about his travel expenses.

https://www.sandiegouniontribune.com/news/watchdog/story/2020-02-13/cross-country-road-trip-guns-n-roses-show-and-phantom-dinner-guests-courtesy-of-cal-state-san-marcos?fbclid=IwAR1PjI_rkPzVbYed0Cas-VLWgfGekncrV5IpbAC-RDgsdcWKQ24ZJCDj7a0

Link to investigative Report: https://www2.calstate.edu/csu-system/transparency-accountability/audit-reports/Documents/special-investigation/2019/19203SpecialInvestigationSanMarcos.pdf?fbclid=IwAR1qYMTQWCBWrbSIwgIyOqJkbzR6QaKMwxNiAd-Nns035YO7orsljfCw_m0

Malfeasance Monday – Under Armour Gets Probed, WeWork CEO Gets Away With It, and Ex-CEO of Woodbridge Gets 25 Years in the Pen.

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Have I got a deal for you on some synthetic fabric underwear and a million square feet of new-age office space!

Happy Monday, fellow fraud-connoisseurs! Much like the falling leaves of Autumn, the waning year brings us no shortage of falling stock prices, falling investment valuations, and C-suite executives taking falls. Let’s dive right in…


Under Armour faces federal investigation over its accounting practices (CNBC)

Under Armour is the subject of federal investigations by the Justice Department and Securities and Exchange Commission over its accounting practices, the company confirmed Sunday. 

Under Armour began responding in July 2017 to requests for documents and information related to its accounting practices and related disclosures. Under Armour is cooperating with both investigations and believes its accounting practices and disclosures were appropriate, a company spokesperson said. 

The Justice Department is conducting a criminal investigation and is coordinating with civil investigators at the SEC, according to The Wall Street Journal, which first reported the story. The SEC declined to comment. The Justice Department did not immediately respond to requests for comment.

Under Armour has struggled on its home turf as of late in the face of stiff competition from Nike, Adidas and Lululemon. Its sales in North America dropped 2% in 2018 to $3.7 billion. Analysts say the retailers’ “performance” focused gear, like sweat-proof shirts, does not resonate with as many shoppers. 

Under Armour has also faced turmoil in its executive ranks. The company went through three CFOs in the period between 2016-2017 and is currently in the midst of a transition in its management.

CEO and founder Kevin Plank plans to step down from the top job on Jan. 1, and will be replaced by COO Patrik Frisk. Plank plans to stay on at the company as executive chairman and brand chief.

Plank said the change was part of the company’s succession planning.

There has also been public controversy over Under Armour’s work culture. Employees reportedly charged visits to strip clubs on their corporate cards to win over athletes. Under Armour ended the practice and Plank promised to build a “diverse” and “inclusive” environment at the company in the wake of the controversy.  

The company’s stock closed up 2.37% at $21.41 Friday. Under Armour’s stock is down nearly 11% over the past 12 months.

https://www.cnbc.com/2019/11/03/under-armour-is-the-subject-of-a-federal-accounting-probe-wsj-reports.html


Too White To Catch: NYU Professor Says WeWork Is Like Theranos Fraud (The Mogouldon Nation)

One of our favorite reads is NYU Marketing Professor Scott Galloway’s Blog No Mercy/No Malice. If all Prof. Galloway had ever accomplished was coining the business term “Yogababble,” That would have been enough in my book to elect him to the business-blogger Hall of Fame (if such a thing existed. Get on it, WordPress!). However, he’s done much more than that. Back in August, he called the WeWork debacle before it all came crashing down. He also rightly identified it for what it was – a scam, specifically a scam perpetrated by founder Adam Neumann. Galloway predicted that Neumann would bail when the house of cards he had built started to collapse, and would take an ungodly sum of cash with him when he left, essentially leaving investors and employees holding the bag.

Now, Isheka N. Harrison has expanded on Prof. Galloway’s thesis, and made the case for why Neumann will very likely get away absolutely scot-free. It’s hard to argue against the benefits of Upper Middle Class Pseudo Hippie Sociopath White Privilege when confronted with the We Work story. It’s a crazy one, and worth diving into!

https://www.profgalloway.com/wewtf

https://moguldom.com/229869/too-white-to-catch-nyu-professor-says-wework-is-like-theranos-fraud/


Is There a Wine Cellar in Federal Prison? Former Woodbridge Group CEO gets 25 years in $1.3-billion fraud (San Diego Union-Tribune)

Robert Shapiro, the former chief executive of Woodbridge Group of Cos., received the maximum sentence of 25 years in prison for running a $1.3-billion fraud that caused more than 7,000 retirees and other investors to lose money.

Shapiro, 61, of Sherman Oaks, promised returns as high as 10% from investments in loans to property developers. Instead, he used money from new investors to repay earlier ones and used $36 million to buy luxury homes, wines, paintings and custom jewelry for his wife.

U.S. District Judge Cecilia Altonaga in Miami sentenced Shapiro on Tuesday, giving him twice the amount of prison time suggested by his lawyers, according to court records.

Shapiro’s team argued that he’s in poor health and that the 25-year term recommended by prosecutors is harsher than the sentence he would probably have gotten for armed bank robbery, hijacking an airplane, sexual abuse of a child or even murder.

Prosecutors said Shapiro moved money through a network of 270 limited liability companies that he controlled. Investors lost $450 million, according to the government.

The scam ran from July 2012 until December 2017, when Woodbridge filed for Chapter 11 bankruptcy protection.

Shapiro pleaded guilty to conspiracy and tax evasion in August. In November 2018, he agreed to pay $120 million to resolve related civil claims by the U.S. Securities and Exchange Commission. Two alleged co-conspirators are scheduled for trial in June.

Prosecutors said Shapiro used investor money for his $6.7-million home and $3.1 million for chartering planes and personal travel. He agreed to forfeit artworks by Pablo Picasso, Alberto Giacometti, Marc Chagall and Pierre-Auguste Renoir; 603 bottles of wine; numerous pieces of luxury jewelry; and a 1969 Mercury convertible.”

https://www.sandiegouniontribune.com/business/story/2019-10-16/former-woodbridge-group-ceo-gets-25-years-in-1-3-billion-fraud


See you on Whistleblower Wednesday!

Fraud Friday: “Inception” Bank Fraud, Cryptocurrency Vanishes, College Admissions Fraud

Greetings from the hazy heat of Summer here in the American Middle West. While it came late after a very wet Spring, it’s finally arrived in all its ridiculously humid glory. Fireflies are cool, though…anyway, one thing that never took a break was fraud, so here we go…


Bank manager hid employee’s fraud to hide his own $500,000 fraud, police say

A senior manager at the Commonwealth Bank, who stole almost half a million dollars, failed to report a member of his team for fraudulently transferring an alleged $64,000 to her personal account, lest his own fraud be discovered, police allege.

Lee Zaragoza, a self-described ‘results driven’ senior manager in the bank’s payment operations unit, is accused of funding a gambling habit by redirecting $463,240 from the bank into his own personal account between 2013 and 2018.” – Sydney Morning Herald

I love it – “results driven.” Yeah, the only result from you being a first-class asshole, Mr. Zaragoza, is that YOU’RE now going to jail, along with your fellow embezzling senior manager. It’s like the movie “Inception,” where everything is a crazily-related M.C. Escher-esque house of mirrors. This kind of situation actually happens more than one might think, particularly in organizations without a strong sense of ethics or a poor or dishonest managerial culture.


Where’d Your Bitcoin Go, Bro?

Losses from the theft of cryptocurrencies from exchanges and fraud-related activities surged in the first quarter of the year to $1.2 billion, or 70 percent of the level for all of 2018, cybersecurity firm CipherTrace said on Tuesday.” – Reuters

Shocking – shocking, I tell you: A bunch of criminal hackers invent a virtual form of money, and then use their superior technical skills to use that invention as an efficient method for separating the stupid from their cash.

Two years ago, I was getting yelled at online for being skeptical about the Bitcoin Bubble. Anyone who questioned the safety and security of blockchain-based cryptocurrencies was shouted down and branded a Luddite, and those without a blind self-interest in profiting from a bunch of suckers got badgered into silence. Well, the separation of idiots from their funds appears to be continuing apace…


Long before college admissions scandal, universities saw signs of fraud on campus

More than a year before the college admissions scandal investigation began, Georgetown University “discovered irregularities” in the athletic credentials of two tennis recruits, initiated a secret investigation and eventually forced coach Gordon Ernst to resign, court records show. University officials say those two athletic recruits were denied admission.

But none of Ernst’s conduct would become public until he was arrested in March on charges he accepted $2.7 million in bribes between 2012 and 2018. He has pleaded not guilty to racketeering conspiracy.” – LA Times

Once again, I’m surprised that anyone was surprised by this scandal. It’s been clear for several decades to anyone willing to see and hear that these sorts of schemes have been going on for a long time. Well, hopefully someone will have plenty of time on their hands to “get educated” about the issues from inside a correctional institution.

That’s all for now. Have a great weekend, and be on the lookout for some exciting format and layout changes arriving soon!

Turkey Tuesday Fraud Roundup, a Cornucopia of Misdeeds and Malfeasance

Greetings, Gentle Readers!

As many of you know, we normally post on Fraud Fridays. However, because many of you will be busy this upcoming Friday (despite your urges, please don’t punch that 75-year-old woman who grabbed the last inflatable Baby Jesus right out of your hands at the Big Box store – there will be plenty more blow-up nativity scenes imported from China, I promise), and Wednesday is Dante’s previously unnamed Tenth Circle of Hell, aka Travel Day, that it might be more convenient to post today.

Enjoy stuffing your face, watching football, visiting relatives, & don’t forget to remind your racist uncle that Thanksgiving is a lie.  That should make for fun conversation ’round the family holiday table!


  1.   Ghosn, Ghosn, Gone: Nissan Exec Arrested Over Financial Misconduct

    You know it’s bad when they *arrest* the Big Guy at a politically-connected multi-billion global corp. – CNN Business
  2. New, Improved 1MDB Scandal – Now With More Vampire Squid: The 1MDB Scandal Moves Apace

    So, Goldman Sachs helped Former Malaysian Prime Minister Hajib Razak steal and launder hundreds of millions, if not billions of dollars? I’m shocked, shocked I tell you! ACFE Insights Blog

  3. A Few Billion Shekels Here, A Few Billion Shekels There, & Pretty Soon, We’re Talking About Real Money: Israeli Police Say Minister Should Be Charged With Fraud

    Police spokesman Micky Rosenfeld said there is an ‘evidentiary basis’ that Aryeh Deri committed fraud and breach of trust, as well as millions of shekels in tax offenses and money laundering, and the disruption of court proceedings.

    Police have questioned Deri and his wife on suspicion of receiving illicit payments from businessmen. They deny any crimes were committed.

    Deri was previously sentenced to three years in prison for bribery, fraud and breach of trust in 2000 during his previous stint as interior minister in the 1990s. He served 22 months in prison but made a political comeback and retook the reins of the ultra-Orthodox Shas party in 2013.” – Associated Press

  4. To Serve & Protect (Herself): St. Johns County Sheriff’s Office Finance Director Arrested for $700,000 Fraud Scheme

    It never ceases to amaze me that vendor-fraud schemers use readily identifiable names and addresses for their fake vendors. I guess Narcissistic Personality Disorder comes with it’s own built-in weaknesses. WOKV Radio, Jacksonville, FL

  5. Nothing is Easier to Spend Than Someone Else’s Money: University of Louisville Foundation audit ‘paints disturbing picture’ of excessive spending and attempts to conceal truth
    Under former University of Louisville President James Ramsey, the U of L’s nonprofit foundation depleted the university’s endowment to fund excessive spending on things ranging from compensation to real estate to football tickets, according to special audit released Thursday.

    And, emails revealed in the audit show Ramsey’s former chief of staff, Kathleen Smith, ‘expressed an interest in concealing’ the foundation’s more-than $20 million in extra compensation from public records and journalists, according to the report.

    In 2014, for example, Smith told the foundation’s outside attorney that an obscure name was needed for the foundation’s new subsidiary company that handled deferred compensation – to make it ‘difficult to figure out for (the) media.'” – WDRB TV, Louisville, KY


    Food Recommendation: You haven’t lived until you’ve had some spectacular, delicate Povitica (aka Kolachi, Strudel, etc.) from the Strawberry Hill Bread Co. 

    Music Recommendation: An excellent live album from simply the best singer-songwriter in the business today, along with his crack band. Jason Isbell and the 400 Unit – Live From the Ryman captures a group of musicians at their creative peak, pushing the boundaries of musical genres.

     

 

Fraud Friday: All The Queen’s Horses

It’s not too often that us auditor/fraud investigator/forensic accountant-types find ourselves in the bright light of mainstream celebrity. In a way, our entire collective professional identity is primarily as anonymous bean-counting corporate drones. We even revel in it, and use it to our advantage when trying keep an ultra-low profile during an investigation.

Really, accountants and auditors tend to only make the news when it’s BAD (here’s looking at you, Arthur Anderson). To be fair, the ACFE and their wonderfully named trade magazine, FRAUD, is full of stories of intrepid, tenacious defenders of truth, justice, and the American Way, but let’s face it: Nobody but us reads those stories.

The closest I’ve seen any frauditor-types come to mainstream celebrity is Harry Markopolous, the kick-ass CFE who unearthed the Bernie Madoff Ponzi scheme, which remains the largest confirmed Ponzi/Pyramid-type fraud scheme in world history, with estimates of up to $100-billion dollars stolen (although Mr. Markopolous insists that at least $35 billion of that figure consists of fictional profits that Madoff reported, but that never really existed). Regardless, I highly recommend Mr. Markopolous’ fantastic book about the Madoff scandal, No One Would Listen.

But now we’ve got a new contender for fraud-world celebrity, such as it is: Kelly Richmond Pope, PhD., CPA:

KRPope
Source: https://www.allthequeenshorsesfilm.com/filmmakers/

Dr. Pope, in addition to being a professor of forensic accounting, ethics and leadership, and managerial accounting at DePaul University, is a self-described “Left-handed CPA who uses filmmaking to teach people about decision-making.” I recently had a chance to attend a private showing, of her latest documentary film, All The Queen’s Horsesand it is remarkable. It may be the single best documentation of the complex psycho-social web that surrounds every fraud scheme.

You may remember the surreal headlines coming out of the sleepy small-town of Dixon, Illinois in 2012:
Crundwell Indictment Press Release
Source: FBI press release, 5/1/12

“Financial controls in Dixon were the ‘perfect storm of embezzlement,’ an expert says”
Chicago Tribune

“Woman accused of bilking $53 million from Reagan’s boyhood hometown”
Reuters

The story seems utterly banal: Small-town has poor-to-non-existent internal controls in its municipal government operations, and a long-time employee sees an opportunity for malfeasance and takes it. But this case is really something else – Rita A. Crundwell, the long-time town controller, stole AT LEAST $53 million over a period of twenty years. This from a small farming community of less than 16,000 people.

Dr. Pope began working on the film shortly after Ms. Crundwell’s arrest in 2012. Recognizing that there was a compelling story beyond just the dollar amount in this case, Pope and her production team took six years to ensure that the entire tale was told – from Rita Crundwell’s humble and quasi-idyllic childhood, all the way through arrest, indictment, and sentencing and the subsequent human, political, and economic aftermath.

I think what I found so compelling about All The Queen’s Horses was how well the film captures the emotional roller-coaster that whistleblowers find themselves on, and the ripples of fallout that affect people far beyond the primary participants in the saga.

Narrated by Dr. Pope in a crisp, entertaining style, the film intersperses dozens of interviews with experts and laypeople, politicians and taxpayers, academics and activists, while also taking an educational approach, with numerous animated info-graphics and concurrent storylines.

A key theme that emerges is that Rita Crundwell could never have pulled off the largest municipal fraud in U.S history without a number of unwitting assistants. It’s a textbook case of failure of multiple lines of defense against fraud: A bank that fails to adhere to anti-money-laundering procedures. A good-ol-boy city council that was asleep at the wheel. Dozens of colleagues, friends, and family members that never seriously questioned Rita’s expertly delivered but suspicious cover stories. And a global audit firm that failed their fiduciary duty to their client (the City of Dixon), that their shame (and liability) should be infinite. It’s all quite a tale, told in a fast-moving and entertaining 1 hour, 10-minute film that is very well-produced.

Most of all, All The Queen’s Horses serves as a vivid reminder that every entity involving humans is susceptible to fraud in all its forms. The thing I keep going back to when thinking about the film is the fundamental decency of virtually everyone in Dixon. Hard-working, honest, charitable, polite folks. The proverbial salt-of-the-earth-midwesterners that I’ve come to know and love after living in Kansas for nearly a decade. These folks trusted Rita Crundwell with their tax dollars. She stole nearly all of it, and roads, sidewalks, buildings, and other public infrastructure in Dixon steadily decayed. Kelly Richmond Pope captures the pain and betrayal that these folks feel, and their confusion and angst at realizing that it was “one of their own” that did it.

All The Queen’s Horses is available on all major streaming platforms, and has been one of the most-watched documentary films of the past two years on Netflix, iTunes, Amazon Prime Video, and Google Play.  I highly recommend taking the time to watch it and research the story and the film!


Music Recommendation: Nathaniel Rateliff & The Night Sweats, Live at Red Rocks A tasty stew of blue-eyed soul, greasy garage-band rock-n-roll, and classic R&B, along with an assist from the amazing Preservation Hall Jazz Band of New Orleans. A new favorite – highly recommended!

Food Recommendation: The short-rib griller sandwich at Q39, Kansas City Pitmaster Rob Magee’s incredible restaurants in Kansas City and Overland Park, Kansas. This thing is worth getting on an airplane for – trust me. Truly sublime. Magee’s Q39 has rapidly ascended the ultra-competitive KC BBQ ladder.

Fraud Friday: Catch Me If You Can, or How I Learned the Value of Hard Work From The Best Confidence Man Of All Time

CatchMe

Greetings, fellow fraud-nerds! Today, as it is midsummer, and ’tis the season for travel, family vacations, and stolen tourists credit cards, I thought that rather than highlight current news in the fraud investigation and audit universe, we could take a fun look back at one of the true characters in the long and storied dance between the perpetrators and the investigators who doggedly pursue them.

Most of you are at least passingly familiar with the remarkable story of Frank Abagnale, Jr., aka “The Catch Me If You Can Guy,” aka the highly successful business fraud consultant, aka the greatest check washer of all time. For those of you who are unfamiliar, or if you want to do a deeper dive and read a great book, we highly recommend Frank’s autobiography (with co-author Stan Redding). It’s an entertaining and revealing read, if a bit dated in terms of fraud scheme logistics, but the social engineering principles remain as relevant as ever. They don’t call them “Confidence Men” for nothing!

Of course, Abagnale’s big break into pop culture came when Steven Speilberg and Tom Hanks adapted the autobiography into the hit film of the same name. It’s a highly stylized, gauzy retrospective look back at the idealized jet set of the 1960’s. Leonardo DiCaprio plays our antihero with relish, and Tom Hanks is perfectly cast as the stereotypical tireless gumshoe investigator, playing a human game of cat-and-mouse across the globe. It’s worth owning the blu-ray for the extras – including additional background and some cool FBI investigative documentary footage. But the book and movie are not what I want to focus on today. Rather, I want to highlight the value of persistence, determination, and plain old hard work.

I’ve attended a couple of lectures with Abagnale. These talks are Abagnale’s bread-and-butter, and you can video of many of them online. His “Talks at Google” episode is particuarly good. What’s interesting about Abagnale, and what makes him so different from a lot of the “reformed fraudster” lecture set is that he openly admits that he’s not “reformed” or “cured” in any way. He’ll straight-up tell you that he’s not necessarily a changed person, he just chooses not to use his talents for illegal activities. It’s remarkable when you see him tell a room full of fraud investigators, attorneys, and law enforcement that he’s still the same con man he always was.

But what is also remarkable, and sets Frank Abagnale, Jr. apart is his sheer work ethic. When he was washing checks, it was all he did. Nothing else. He set out to become the best check-washer in the world, and by most accounts he was. He was obsessive about learning and mastering the details of his craft, illegal though it might have been. This is one of the things that the movie gets correct, in my opinion. DiCaprio’s Abagnale is obsessive to the point of madness, which, though it may not be mentally healthy, did create a form of excellence in him.

That’s one of the key takeaways of Abagnale’s talks – if you work incredibly hard at something, you WILL get good at it. You may not be the best, but you’ll eventually become competent. He said that the only reason the FBI caught him was that he was finally pitted against an agent who was as obssessed with catching his man as Abagnale was in staying on the lam and living large. (Note: Carl Shea – Hanks’ version of Shea in the film is Carl Hanratty – is the real life FBI agent, and him and Abagnale are now friends and sometimes do seminars/speeches together).

There’s no shortcut: If you want to master anything, you have to be a bit obsessive about it. That may not go over well in the era of “work/life balance” and the foreign (to me) concept of “self-care.” If you put in the hard work and the long-term effort, nobody will be able to catch YOU.

Have a great weekend!

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