| n Wichita, Kansas, police arrested a
22-year-old male who tried to pass two counterfeit
$16 bills at an airport hotel. And in St. Louis, a
bus carrying five passengers was involved in an
accident. However, when the police arrived, 14 more
people were aboard the bus, all complaining of
whiplash and back pain. Not very smart. But at a
time when CPAs hear so much about how ingenious
fraudsters at high levels can be, it’s good to know
they’re not all so powerful or clever. As a matter
of fact, some—as my English friend says—may be one
sandwich short of a picnic lunch. |
high and low to bring you examples of the dumbest
of the “dumbsters.” And I admit it up front: The
only lesson to be learned is just how stupid some
people can be. Sit back and enjoy.
As Dorothy Marie
Livingston approached the new-accounts clerk at a
bank in Newport, Pennsylvania, they exchanged
smiles. Ms. Livingston explained that she wanted
to open a checking account.
The clerk was
efficient, pleasant, professional and brand new on
the job. Once the paperwork had been completed, it
was time for Ms. Livingston to put money in her
new account. The clerk asked, “And how will you be
making your initial deposit?” Ms. Livingston
opened her purse, withdrew a $1 million bill and
handed it across the desk.
new-accounts clerk, concealing her astonishment at
the large bill she was holding, dutifully recorded
the deposit and gave her customer a receipt.
“We’re glad to have your business,” the clerk said
with a smile. They shook hands and Ms. Livingston
walked out. Before the counterfeit deposit was
discovered a few days later, Ms. Livingston had
managed to transfer an undisclosed sum to her
husband’s bank account.
new-accounts clerk hadn’t been trained to know
that the fake $1 million bill was 10 times the
value of the largest bill ever printed by the
government—a $100,000 bill existed for about three
weeks in the 1930s—and 10,000 times that of the
$100 bill, which is the largest denomination in
circulation now. And while the clerk learned a
hard lesson, Dorothy Marie Livingston learned
about hard time.
…AND EVEN BIGGER
In a similar effort,
a Utah auto mechanic, Kevin Jackson, showed up at
a bank with a $100 million U.S. bond, demanding he
be given the entire principal and another $100
million in interest. On his way to serve four
years in prison, police revealed to Jackson what
had tipped them off: The largest U.S. bond ever
issued was $1 million.
When Curtis Boyd was
running a bit short of money, the solution seemed
obvious: create his own bank. Using a check-making
program he purchased at OfficeMax, Boyd produced a
$22 million check, payable to himself, drawn on
the “Reality Perspective Bank.”
gave the bogus instrument to teller Tammy Ferguson
at the drive-up window at the Bank of Norfolk in
Nebraska, she noticed more than the odd name of
Boyd’s bank; the address was suspect, too. After
all, Ferguson observed, how many banks operate
from an apartment? Boyd left empty-handed. Police
are still looking for him.
A PICTURE IS WORTH A THOUSAND DENIALS
Sam had an ingenious
plan. He would set up a phony company and open a
bank account. Then, he would establish credit for
the fake enterprise. Using the lines of credit, he
would order a load of expensive computer chips,
which he would dump on the black market at a
fraction of their value. Finally, he would close
the business and move on, sticking the chip
manufacturer with the unpaid bill.
Sam didn’t count on were the pictures—the ones the
bank took while he transacted the bogus business
with the credit officer. When the Federal Bureau
of Investigation showed Sam a very clear snapshot
of himself, the agent asked, “Do you recognize the
man in this photograph?
|“No,” was his
firm reply. |
“Do you recognize anything
about him?” the agent pressed on.
“No,” Sam replied a second time.
“Do you recognize the hat?”
“No. Why do you ask?”
“Because you are wearing it right
now,” the agent responded, smiling
“I need a lawyer,” Sam
“That’s the only true
statement you’ve made so far,” replied
the FBI agent, erupting into laughter.
COMPUTER CRIME WITH
Besanon, France, a 19-year-old
computer whiz had been
summoned to court for drunk
driving. While waiting for his
appearance, he spotted a
computer at an empty desk. It
took the genius only a few
minutes to hack into the
master drivers’ license
While in the
Web site, he located his own
driving record, which he
deleted and replaced with a
smiley face. The judge,
however, wasn’t smiling when
he sentenced the young man to
90 days probation, a $425 fine
and suspended his driver’s
license for three months.
Dave, the internal
auditor, rubbed his eyes. Then he looked again at
the three expense vouchers before him—individual
requests for reimbursement of travel expenses from
three employees to an out-of-town seminar. Dave
declined paying the modest sums for three reasons:
Problem no. 1: The amount requested for
reimbursement of automobile mileage on each
expense voucher was identical.
2: Dave previously had seen all three men pile
into the same car for the trip.
no. 3: The three employees who were triple-billing
expenses were traveling to attend a seminar on
THE HAPPIEST FRAUD VICTIM EVER?
Andrew Cameron of
Cheltenham, England, spied what he thought was a
valuable prize: Still in the mailbox was an
envelope containing a brand-new credit card for
Jacqueline Boanson. Cameron filched it and headed
directly for the racetrack, where he charged two
bets totaling $150 on the card.
Boanson didn’t even know the card had been lifted
until she received a statement from the credit
card company with a $400 credit. It seems that
Cameron had won, but the racetrack wouldn’t pay
him in cash. Since the bets had been placed on a
credit card, the winnings were credited to her
“If the bets had been losing
ones, they would have been voided from her credit
account, but under the circumstances, it would
seem a bit churlish to deprive Ms. Boanson of her
winnings,” said a racetrack official.
Cameron received a 12-month probated sentence.
In his defense, Cameron’s solicitor told the
judge, “Andy Cameron did her proud and she must be
the happiest victim that we ever had in this
DEWEY, CHEATEM AND HOWE
Pender’s sense of humor got him in big trouble.
The Lubbock, Texas, man pled guilty to an identity
fraud scheme that had cost credit card companies,
casinos and banks $1 million over a four-year
period. Using various combinations of the name of
the fictitious Three Stooges law firm, “Dewey,
Cheatem and Howe,” Pender somehow was able to get
more than 100 lines of credit. The joke became his
downfall when bank vice-president John Reed was
asked to approve a money-order request from
Pender. Reed—a fan of classic TV shows—took one
look at the name and called the FBI, who had the
THE OLE SWITCHEROO
Jr. of Tampa, Florida, thought he was
clever. The enterprising crook, knowing
the bank would be closed all weekend,
taped a sign to the night deposit slot:
“This drawer is out of order. Use the
alternate box provided.”
box that Clark had placed next to the
real slot actually was an overnight mail
bin stripped of its identifying decals.
But to the pizza manager making a
deposit on Saturday, something just
didn’t look right. He called the police
who discovered that other depositors
hadn’t been so alert: More than $35,000
in cash had already been dropped into
the fake bin. When Clark stopped by
later to pick up his loot, officers
A German man used his brother’s
identification to break into jail.
Officials at Glassmor Prison are still scratching
their heads trying to figure out why an inmate
identified as Norbert would attempt to serve his
brother Rudi’s two-year sentence.
spent 11 months behind bars before being spotted
by a new inmate who knew both siblings and tipped
off officials. It was unclear how Norbert, using
Rudi’s ID, was able to get past prison officials;
they bear little physical resemblance.
Rudi now is back behind bars serving his full
sentence, and Norbert has been given the boot. But
German officials are demanding Norbert pay $2,500
for his stay. Moreover, Norbert won’t get the $500
he earned in the prison work program.
YOU CAN’T WALK AWAY FROM YOUR DEBTS
South Korean police
were suspicious of Chung Kyu Chi’s story. They
found Chung, a self-employed grocer, lying in a
bloody heap on the floor, both of his feet severed
at the ankles. Chung claimed someone must have
mutilated him while he was passed out from a
But then police found out
Chung recently had bought an insurance policy that
would pay him $1.5 million if he was accidentally
disabled. They also found out that the day before
the incident Chung had purchased anesthetic at a
local pharmacy. Finally, police interviewed
neighbors who said Chung had been asking them for
several months to amputate his feet.
confronted with the evidence, Chung admitted that
he paid an acquaintance to cut off his feet and
discard them. Chung’s motive? To pay debts.
A police spokesman said: “He hasn’t actually
tried to claim the insurance money yet, so we
can’t arrest him for fraud. And he didn’t sign a
sworn complaint about the incident, so we can’t
arrest him for perjury. That means, at present,
he’s free to walk away. Well, so to speak.”
THE HOLE TRUTH
Police detectives in
Radnor, Pennsylvania, were having trouble
convincing a suspect to confess. Lacking a lie
detector machine, which might have helped them
glean the truth, the investigators quickly
improvised. They connected two wires from the
office copy machine to a metal colander, which was
then placed on the suspect’s head.
time the hapless miscreant answered incorrectly,
one of the investigators would press a button and
the copier would spit out a sheet of paper with
two words: “He’s lying.” Figuring this ingenious
machine had nailed him, the suspect quickly
JOSEPH T. WELLS, CPA, CFE, is
founder and chairman of the Association of
Certified Fraud Examiners and a professor of fraud
examination at the University of Texas at Austin.
Mr. Wells is a member of the AICPA Business and
Industry Hall of Fame. He won the Lawler Award for
the best JofA article in 2000. Mr. Wells’
e-mail address is