Accounting & Investing Info for San Antonio A & M
One of the amazing things about fraud is how easy it is to dupe peopel. Jason submitted this story about a fellow who promised ‘security for those that did not like traditional banks.’ He then took client money and deposited it in a regular bank and actually conducted regualr business. Such fellows usually flee to a country without an extradition agreement. Well, gee, the IRS is peeved claiming he did not have what he promised.
What was it that Barunm said about one being born every minute?
Dr. Elam, Do you ever just sit back after reading some of these articles and laugh at the schemes that people cook up? I mean what ever made this man think that he would not get caught? There are numerous banking laws that clearly focus on preventing this and Im sure its what alerted IRS investigators, on top of not filing his taxes. For instance, their are CTR’s that are filed daily for those genious who are trying to move a lot of cash between banks, in excess of $10,000.01 pennie of course. There is also reports called SAR reports. These are calles Suspicious Activity Reports. Im sure any banker with half of their brain knew the large deposits being made were out of the ordinary, and they reported him. When will we learn that if we committ a crime our chances of getting away with it are very small? I must admit, this was an entertaining article for me, given I work in banking and I see people trying to pull things like this off all the time. Just not on this huge of scale.
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Jordan
Actually the wonder is that there is always someone who falls for these things. consider
http://en.wikipedia.org/wiki/Ponzi_scheme
this linke to the wiki article on Ponzi schemes. Carlo Ponzi virtually invented the now famous ‘hand off’ ponzi scheme. On the site you will see that there have been many since and quite a few before Ponzi. This is why I recommended Den of Theives. In public Boesky claimed to be a new kind of merchant banker, frequenting the Harvard Club in NYC no less. He was neither a Harvard grad nor a merchant banker but a simple fraud trading on inside information.
Aw you correctly point out, there are plenty of ways to check on such things, but look how long Enron went on, even when an analyst was saying hey, no way, and apparently they had most of Houston TX fooled.
Clearly you know the ropes in your business, that and a knowledge of accounting allows us to see thru such shams.
Glad you enjoyed the article and thanks to Jason again.
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I agree with both point of views:the fact that he thought he could get away with it and the fact that people fell for it. I also used to work at a credit union and a favorite scam of mine is when one of our members would come in with this large check, want to cash it and then have us cut them an cashier’s check so that they could send some type of “fee” back to the people they got the check from. I mean come on. Did the person who cut you the check not have a claculator so that they could calculate the difference of your “fee” and just cut you the check for the right amount? It really was sad to see how willing people are to try to get something for nothing and not question the legality or even the incredulousness of the situation. (Even after trying to explain the fraud to some members and trying to talk them out of sending the money, some did, and obviously were quite distraught when the check did not clear their account)
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I agree with both point of views:the fact that he thought he could get away with it and the fact that people fell for it. I also used to work at a credit union and a favorite scam of mine is when one of our members would come in with this large check, want to cash it and then have us cut them an cashier’s check so that they could send some type of “fee” back to the people they got the check from. I mean come on. Did the person who cut you the check not have a claculator so that they could calculate the difference of your “fee” and just cut you the check for the right amount? It really was sad to see how willing people are to try to get something for nothing and not question the legality or even the incredulousness of the situation. (Even after trying to explain the fraud to some members and trying to talk them out of sending the money, some did, and obviously were quite distraught when the check did not clear their account)
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Good posts by Jordan and April, glad you are able to quickly see these scams, and as you both say, it is incredible that folks can’t see through these things
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Professor Elam 
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