Of all the categories of criminal activity, fraud might allow the most room for creativity. Defrauding others involves psychology and manipulation, financial sleight of hand, and trickery. Some fraud cases are interesting because they are so masterfully conceived, but the ridiculous failures are also entertaining. Here are four fascinating fraud cases you might not have heard about.
The Jury Is Out
Image via Flickr by steakpinball
Joseph Winstead, a postal worker from Washington DC, claimed he was serving jury duty on a lengthy federal trial for nearly five months. He was excused before the deliberations began but collected wages from the U.S. Postal Service the entire time, using fake court paperwork to support his reimbursement. Winstead actually got away with his crime, collecting over $30,000 in unearned pay, then got caught when he tried the same trick again three years later. Ironically, he was tried for fraud in the same courthouse where he claimed to have served on a jury.
Inside-Out Insurance Fraud
When we talk about insurance fraud, the insurance company is usually the injured party. But in the 1960s, Equity Funding of America was the perpetrator of a massive hoax. In 1964, the company had a computer problem while it was working on its annual report. The company’s CEO chose to make fictitious accounting entries to meet the deadline. The company then continued the fraud by creating fake policies to substantiate the false revenues, then it reinsured the phony policies and faked the deaths of some of its “customers” to collect on the reinsurance. In the end, the fraud reached billions of dollars and resulted in charges against 22 executives and employees. The case is considered to be the first major computer crime and also resulted in some early insider trading charges.
The Queen of Slip-and-Fall Claims
Suing a company for a faked slip-and-fall injury on its property is common insurance fraud, but 72-year-old Isabel Parker has taken the old scam to a new level. Parker has thrown herself to the ground in stores 49 times and collected $500,000 in claims over the years. Parker was supporting a gambling addiction by gambling on insurance claims. Some organized groups of scammers have taken a page from Parker’s playbook, filing claims at dozens of businesses each year in hopes that each business will be covered by a different insurance company and no one will notice the pattern.
Phishing by Phone
In 2014, the FTC stopped a massive telemarketing fraud scheme, but not before the scammers had bilked senior citizens out of millions of dollars. The crooks used a variety of bogus telemarketing companies as fronts to call consumers and collect their bank account information over the phone. They then used the banking details to withdraw money from their victims’ bank accounts. Telemarketing is an industry that is rife with fraud, so people are wise to be cautious about phone sales reps.
These cases are only the tip of the iceberg. Swindling others with fraudulent business practices is probably as old as commerce itself, and it continues to grow and change with the times.
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