Fraud Scams Blog

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White collar crimes were often treated lightly in the past. Average citizens would lose money that they worked hard to obtain, but those responsible would be sent to prisons that resembled country clubs in many ways. This is no longer the case. White collar crimes, including fraud, are being prosecuted to the fullest extent of the law. Here are some notorious fraud cases that you may be familiar with.

1. Bernie Madoff lead a $65 billion dollar Ponzi scheme that affected average citizens and famous people alike. Over 1,300 investors lost money due to his actions and he will spend 150 years in prison as a result of his crime. Before you invest your money, make sure you do research into the investment firm being used. You should also diversify your investment portfolio so, if one company commits fraud, you won't lose your entire savings in one fell swoop.

2. Anthony Lemar Taylor stole the identity of Tiger Woods whose real name is Eldrick T. Woods. As he did not go by "Tiger", he was able to pull this scheme off for an extended period of time. He not only ran up credit card bills using Tiger Woods' social security number, he also applied for loans and purchased items. He is now in jail for 200 years. To avoid becoming a victim of identity theft, you must protect confidential information, such as your social security number, at all times. Monitor your credit report regularly so, if someone does steal your information, you can catch it quickly and make it easier to resolve the situation.

3. Dennis Kozlowski, former CEO of Tyco, misappropriated over $400 million of company money to fund his lifestyle. He felt he did nothing wrong and said the jury convicted him based on the fact that he made a million dollars a year and they couldn't relate to that. Stockholders would disagree, saying he took their profits for himself. He is currently serving a prison sentence of a minimum of eight years and four months. If you own stock in a company, you should review the annual financial statements and question any unusual activity you see. If the company cannot provide a valid explanation for these expenses, you may wish to invest your money elsewhere.

There are as many different ways to commit fraud as there are desperate criminals who will do anything to get ahead. At its base level, fraud usually involves some form of theft, which means someone will be left holding the bag. Unfortunately, innocent people get hurt; some of them may lose every penny they have. Human nature makes us trusting, as we hope for the best in life and try to see the good in every person or investment opportunity. On the other hand, that same human nature can pervert those who are trusted into taking more than their share. Always remain vigilant and do your homework before giving any money to a cause, entity, person, or organization.

Stay tuned for more frauds and scams case studies, alerts, and general information!