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Tag: Fraud

Aryan Nations Leader Who Appeared on Jerry Springer Show Sentenced in Fraud Case

By Danny Fenster
ticklethewire.com

An Aryan Nations leader of  fleeting TV fame was sentenced Wednesday for taking more money than he was legally entitled to from a government he despised, the Associated Press reports.

August Kreis III, who appeared multiple times on the Jerry Springer show and in a 2005 interview on CNN called al-Qaeda fellow freedom fighters in the war against Jews and the American government, was sentenced to six months in prison that he’d already served,  plus six months of home arrest and two years of probation in a Columbia, S.C. U.S.  District Court on Wednesday. Kreis was also ordered to pay back the nearly $193,000 he was said to have improperly received in veteran benefits.

Kreis served nine months with the Navy in Vietnam before being discharged for not being fit for service, which made him eligible for benefits, according to AP.

Kreis was a High School dropout who  joined the Ku Klux Klan in New Jersey in the late 70s before working his way up the ranks of several white supremacist groups and gaining media attention through the years. “Your relatives — weren’t they all turned into soap or lampshades?” he told the Jewish television host Jerry Springer during a 1995 show. “I’m looking for one of those lampshades,” he said.

At sentencing he appeared similarly hateful. “I don’t preach to hurt anybody, except the Jews, and I’ll keep doing that,” he said in court. “But that’s my First Amendment rights. As long as I obey God’s laws, I don’t care about anything else.”

To read more click here.

 

Hunt on for $600M; Smelling Like Fraud

Ex- NJ Gov. John Corzine

By Danny Fenster
ticklethewire.com

FBI investigators have found themselves in a “Whack-a-Mole” like search for $600 million in missing funds, reports MSNBC.

The search, in partnership with the Commodity Futures Training Commission and the SEC, is for lost customer cash in an investigation into New Jersey Gov. John Corzine’s now bankrupt brokerage firm MF Global. The missing funds are starting to smell like fraud, says former SEC chief accountant. “The fact that people today can’t tell us where the $600 million went is not a good sign.”

Investigators are looking into whether or not the firm used client money to fund its trades, an illegal practice, which may be difficult to determine. “They may have been involved in an aggressive interpretation of the securities laws,” said one anonymous  securities lawyer. “They met the letter of the law — the question is whether they met the spirit of the law.”

To read more about the investigation click here.

OTHER STORIES OF INTEREST

 

 

More on the Bernie Madoff Fallout: 8 SEC Workers Disciplined

Bernie Madoff/facebook photo

By Allan Lengel
ticklethewire.com

The Madoff scandal is the gift that keeps giving.

The latest: David Hilzenrath of the Washington Post reports that the Securities and Exchange Commission has disciplined 8 of its employees as part of the agency’s failure to stop the fraud.

But Hilzenrath writes that no one was fired even though SEC’s head of human resources and a law firm hired that one person –described as a manager in the office that inspects investment firms — be fired.

Hilzenrath writes:

“The disclosure that no one was terminated comes at a time when street protesters and other critics who blame Wall Street for the country’s economic plight are questioning whether the government is serious about holding powerful wrongdoers accountable. This week, a federal judge excoriated the SEC for letting firms such as Citigroup settle fraud charges without admitting or denying wrongdoing.”

To read more click here.

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Cyber Ring that Infected Millions Taken Down

By Danny Fenster
ticklethewire.com

Six Estonians operated a vast internet fraud that infected approximately 4 million computers in more than a hundred countries–500,000 of which were in the US–according to a federal indictment unsealed in New York Wednesday. Their arrests in Estonia on Tuesday were the culmination of a two-year FBI probe named Operation Ghost Click.

The cyber ring, beginning in 2007, used what is called a DNSChange to interfere with unsuspecting people’s web browsing.

DNS, which stands for Domain-Name-System, is the system by which website names and urls are converted into numbers, allowing computers to communicate over a network. The DNSChanger was able to manipulate Internet advertising by redirecting user’s browsers not to the sites they intended to go to, but related sites controlled by the group. They generated $14 million in illicit fees from the scheme, and deprived legitimate businesses and advertisers of potential revenue.

The DNSChanger disabled the anti-virus software of some victim’s computers, exposing them to further viruses.

“They were organized and operating as a traditional business but profiting illegally as the result of the malware,” said one cyber agents that worked the case. “There was a level of complexity here that we haven’t seen before.”

The six Estonians were arrested in their homeland by local authorities on Tuesday, and the U.S. will seek extradition.

Couple Sentenced in Pregnancy Scam

By Danny Fenster
ticklethewire.com

She was perhaps the only lady not carrying for whom you might ask, “how many months along are you?” without being slapped in the face.

Serena Carol Mathews, 42, and boyfriend Scott Thomas Smith, 34, of Oklahoma City, were sentenced to 27 months each on Tuesday in Oklahoma City after pleading guilty on Aug. 1 to conspiracy to defraud. Mathews falsely posed as pregnant and wanting to place her child up for adoption, after which the two sought to receive “birth mother” payments such as rent, utilities, food and personal items, according to an FBI press release.

The couple used the adoption providers to arrange meetings between Mathews and prospective adoptive couples who hoped to adopt a baby.

The two were indicted on June 22, 2010, after an investigation conducted by the FBI. Assistant US Attorneys Susan Dickerson Cox and Kerry Kelly prosecuted the case.

Nine More Charged in Scheme to Defraud Holocaust Victims Fund of Tens of Millions of Dollars

FBI's Janet Fedarcyk/fbi file photo

By Danny Fenster
ticklethewire.com

The massive scandal to rip off a charitable Holocaust fund designed to benefit victims who were persecuted by the Nazis, continued to unravel in N.Y.  on Wednesday.

The U.S. Attorney’s Office in Manhattan announced the arrest of eight more people for being part of  a plot to defraud the fund out of  $57.3 million. A ninth person charged is expected to surrender voluntarily.

Five of those arrested are former employees of the Conference on Jewish Material Claims Against Germany, which administered the charitable programs. The five were charged with knowingly approving nearly 5,000 fraudulent applications, resulting in the payout to unqualified applicants, in exchange for kickbacks. Since prosecution began in the case, a total of 30 people have been charged in connection with the scheme.

The latest folks charged in the case include: Henry Gordin; Genrikh Kolontyrskiy; Viktor Levin; Ella Voskresenskiy; Zlata Blavatnik; Pyotr Blavatnik; Yevgeniya Abramovich; Asya Galindo; and Lana Kagan, the ninth who is expected to surrender voluntarily.

“These defendants had a hand in fabricating, filing, or processing nearly 5,000 fraudulent claims on behalf of non-qualifying applicants,” Janice K. Fedarcyk, head of the N.Y. FBI said in a statement. Claims Conference funds have been drained of $57 million meant for Holocaust victims, and a large portion of the diverted money went into the pockets of corrupt insiders. These were people hired to give who conspired to take.”

U.S. Attorney Preet Bharara added:  “As I said when the initial charges in this case were announced, my office, working with our partners at the FBI, would not stop until we brought to justice those who are alleged to have stolen more than $57 million from the Claims Conference, thereby diverting money intended for survivors of the Holocaust. With today’s charges, we have now identified 30 people who allegedly exploited a fund that is as symbolically important as it is necessary to its beneficiaries. We again thank the Claims Conference for their outstanding ongoing assistance in identifying the participants in this scheme.”

 Read press release

 

Ex-FBI Agent and Wife Charged in $1.3 Million Investment Fraud Scheme

 
 
By Allan Lengel
ticklethewire.com

A former FBI special agent and his wife have been charged in Richmond, Va. federal court in a $1.3 million investment fraud scheme, the Justice Department announced Wednesday.

Ex-agent John Robert Graves, 52, and Sara Turberville Graves, 44, both of Fredericksburg, Va., are charged with multiple counts.

Authorities said that Graves founded Brook Point Management (BPM) in 2003, a company that sold insurance, performed estate and tax planning services and recruited and advised investment clients.

The indictment alleges that between June 2008 and July 2011, John Graves, Sara Graves, and others schemed to defraud approximately 11 investors in central Virginia of approximately $1.3 million.

Authorities alleged that the couple raised investor funds by misrepresenting “the safety and security of the investments, as well as misrepresentations and omissions regarding their use of investor money.”

Authorities alleged that the two used the investor funds to pay back previous investors who requested access to their money; purchase real estate in Partlow, Va.; and pay personal expenses, including credit card bills and time share dues. Authorities alleged that even after the scheme was uncovered, John Graves continued to make misrepresentations through false and misleading statements to the investors and to investigators from the U.S. Securities and Exchange Commission (SEC), FBI and U.S. Postal Inspection Service.

Md. Man With Fake Teaching Credentials Gets 21 Months; Taught Law Enforcement Including FBI

William Hillar

 By Allan Lengel
ticklethewire.com

Who the heck is William G. Hillar?

Well, if you read his online bio you’d see that he had some darn impressive credentials in the military, had a Ph.d and he’s been raking in cash teaching, conducting workshops and giving speeches, and that he received training in counter-terrorism and psychological warfare while in the armed forces.

Problem is, federal authorities say, he’s a fraud.  His credentials were totally bogus.

On Tuesday, Hillar, 66, of Millersville, Md., was sentenced  in Baltimore federal court to 1 year and 9 months in prison followed by three years of supervised release for lying about his military experience and academic credentials in order to gain employment for teaching and training. He was also ordered to pay restitution of $171,415 and perform 500 community hours at the Maryland State Veterans Cemeteries.

The Christian Science Monitor reported that he duped government agencies including the FBI’s Command College, which paid him $17,369 from 2000 to 2010, according to court documents.

“William G. Hillar claimed that he had earned praise as a hero, but the truth is that he deserves condemnation as a liar,” said U.S. Attorney Rod J. Rosenstein in a statement. “He did not serve in the U.S. Army, did not receive military training in counter-terrorism and psychological warfare, and did not lose his daughter to sex traffickers.”

Authorities alleged that Hillar, for at least the past 10 years, has been teaching, leading workshops, giving speeches and conducting training for public and private sector clients under false pretenses.

A website that has been taken down contained a “Bio Info” page that stated “William G. Hillar is a retired Colonel of the U.S. Army Special Forces and had served in Asia, the Middle East, and Central and South America, and his training included tactical counter-terrorism, explosive ordnance, emergency medicine and psychological warfare.

It also said Hillar “holds a B.A. in Psychology, and M.A. in Education, a Ph.D. in Health Education, and an honorary Doctorate in Intercultural Relations, authorities said.

But a court affidavits states that a search of military and civilian records for Hillar in November 2010 showed he had not served with the U.S. Army, and instead, was an enlisted sailor in the U.S. Coast Guard reserves from 1962 to 1970.

Authorities alleged that he was never deployed at the locations stated on his website, nor was he given any Coast Guard training in tactical counter-terrorism, explosive ordnance, emergency medicine and psychological warfare.

He attended the University of Oregon from 1970 to 1973, but he did not earn a Ph.D, authorities said.

Moreover, the government’s sentencing memorandum states that Hillar fabricated a gruesome tale that his own daughter had been kidnaped, forced into sex slavery, sodomized and tortured before being hacked to death with machetes and thrown into the sea.

He claimed that this experience and his life story was the basis for the 2008 film “Taken”. Authorities said the press attention from the film generated free press for Hillar.

Hillar admitted that he fabricated the story about his daughter, who was alive and well, authorities said.