There are many types of fraud. Virtually each type, involves money. Arizona has very good laws if you have been defrauded. Call Bill Miller at 602.319.6899. He has been prosecuting fraud cases for over 34 years.

 Taking From The Boss

Partner, employee or subcontractor fraud costs billions per year. It’s the bookkeeper who keeps separate charge cards, the cashier who short changes the customer. Some companies estimate fraud and error losses to average about 4% of organization’s expenses.

Signs of an embezzler engaging in employee theft are clear. Too many visits to the casino. Too many hang overs from the guilt. Too much sucking up to the accountant. It may be someone cheating on their spouse.  Just ask simple questions. How does a 75K a year sales man have a brand new 100K Raptor?

Other warning signs of a fraudster in an office may not be particularly intuitive. For example, one of the warning signs could be the office manager who never takes a vacation and who never delegates tasks to subordinates. An employer may view that as a dedicated employee. However, these qualities may be pretext for a nefarious reason, to possibly cover something up and ensure no one finds out. The author’s experience in handling employee theft cases is that the embezzler usually steals to gain wants not needs.

As mentioned before, one does not want to promote distrust within an organization. But, a healthy dose of skepticism is appropriate, and thorough internal controls are critical. Internal controls may be as simple as making certain that the person who prepares checks is different than the person signing the check. Finally, every business should have an indemnity bond or employee defalcation insurance to cover losses attributable to dishonest employees.

Investment Nightmares or Ponzi Schemes

Ponzi schemes may be named after Charles Ponzi, but the first known schemer was William “520 Percent” Miller who in or around 1899 defrauded thousands through the Frankin Syndicate in Brooklyn, New York. A Conman is always nice and friendly. They get you to trust them, them they pounce.

A Ponzi scheme is a scheme and artifice which pays monies to investors from such investor’s own principal investments or from new investors. It is a house of cards which ultimately must fail because a Ponzi scheme is not based on any legitimate business enterprise. It sustains itself solely though new investor money and does not do a thing.

The Madoff case is also a classic example of affinity fraud. Given Madoff’s celebrity and apparent success in the SEC world and Jewish Community, investors from his synagogue, the charities with which he was involved and the socialites in Manhattan were drawn to Madoff’s apparent golden touch on investments. There is more than one church who has had reckless members prey on the vulnerable, all using “church terms” to keep the victim off guard.

We prosecuted the NCFE bond case and that was a billon dollar fraud.

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