Fraud Solutions: Fraud News Update 12.30.16

Fraud News Update

Fraud News Update 12.30.16 – This is the last Fraud News Update of 2016! This week’s “end of year” edition features: Start Up Fraud (in the valley), Corporate Scandal, Fraud and Ethics (new documentary), White Collar Crime Prevention (Top Ten), Gambling on Big Data Analytics (winning businesses), Privacy Violations (no drone coverage), Scam Call (blocking) and Fake SEAL (Busted!).

As leaders in the fraud consulting arena, read on for more topical information and our insights, observations and unique commentary on some of the weekly fraud news stories.

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Fraud News Update 12.30.16Start Up Fraud

Where there’s money, there’s fraud. Where there’s money and pressure for businesses and individuals to perform, there’s even more fraud.

It turns out that Silicon Valley geeks involved in technology start-ups, which operate in highly visible fish bowls, aren’t immune to this kind of nefarious, illegal activity either.

Who knew that startups had such a seedy underbelly? When the questionable behaviors rationalized, which is easy to do under the intense investor microscope, you have the potential for fraud palooza.

Fraud News Update 12.30.16Corporate Scandal, Fraud and Business Ethics

Enron remains the quintessential case study of corporate greed, misdeeds and financial shenanigans. Obviously, a lot’s been written about it, and the other classic corporate fraud cases over the years, but the lessons remain viable in today’s business climate.

A new 3 part documentary, airing in January, focuses on ethical decision-making and it’s impact on corporate behavior. Ethics are a strong component of effective corporate governance programs and are instrumental in the prevention of fraudulent activity.

The series is also available online beginning January 18th, via certain public television websites. So, there are plenty of options to view the content and figure out how the lessons apply to your business environment today.

Fraud News Update 12.30.16Curbing White Collar Crime

What a great segue from the documentary on ethical decision-making to a “Top Ten” list of suggestions for preventing these kinds of business activities. Apparently written somewhat “tongue in cheek,” there appear to be some interesting ideas here.

Ironically enough, ethics is also the “theme du jour” here as quite a few of these suggestions have an ethics spin to them.

Honestly, while it may seem completely comedic, there are some serious straws of truth here. I.e. Is there a bigger fraud deterrent for most people than being told how much prison time they’ll get for committing “Act X?!” That’s a handy piece of information to have and would scare the bajeebers out of most folks! Maybe some of these aren’t so silly after all?

Fraud News Update 12.30.16“Gambling” on Big Data Analytics

Five years ago Chicago Cubs owner Tom Ricketts hired Theo Epstein from the Boston Red Sox to change the Chicago Cubs from “lovable losers” into world  series contenders.

Ricketts gamble paid off this year as the Cubs won their first World Series Championship since the curse of the billy goat 108 years ago.

What Ricketts knew, from Epstein’s time in Boston, was that he personified the new breed of baseball executive. Epstein’s “ace in the hole”: big data analytics.

“An objective, data-driven view can change the world.”

Ricketts gambled on Epstein, his big data analytic approach to baseball and hit the managerial equivalent of a grand slam. Think Ricketts is alone? Hardly!

The Golden State Warriors, similarly, figured out that teams who shoot the long ball (3 pointers) effectively have better odds of winning basketball games.

Armed with this analysis, they then went about building an entire team around this particular ability. The result: a world championship in 2015 and a near miss in 2016 after having LeBron and the Cavs on the ropes 3 games to 1.

Pro sports, however, is not alone in understanding the value of big data analytics. See how other businesses, like online casinos, can enhance their business effectiveness and profitability, exploring the use of big data to prevent cheating and fraud.

Fraud News UpdateLook, Up in the Air: It’s a Bird, it’s a Plane

Nope! Just a drone flying overhead.

I’ve blogged regularly about drone usage, investigation, commerce and the legal ramifications associated with flying drones and invading people’s privacy.

The Fraud News Update’s also featured incidents of homeowners taking airspace privacy into their own hands, obliterating flying objects from the sky with a barrage of targeted shotgun pellets. The result: arrest and criminal charges.

Now, comes a new angle: privacy and insurance. If you think your insurance policy covers you for privacy invasion claims while flying a drone…think again. You might be surprised to learn that you’re not made of steel after all! Here are some of the relevant considerations.

Tired of Scam Telephone CallsFraud News Update 12.30.16

Well, who isn’t?

It seems like any time your phone rings these days it’s someone pretending to be someone they’re not, trying to sell you something you don’t want or scam you out of your money or information.

Of course, the onus is completely on the consumer to take the action needed to protect the caller from getting through. Despite the call blocking features available on most phones these days why should that be?

Apparently, AT&T’s been listening to their customer’s complaints because they’re now marketing a new service which they claim blocks these kinds of spam calls at the switch (before the call ever terminates at the customer’s number)!

Not only does this take the onus away from the consumer but ideally helps protect them from the kinds of telephone fraud happening because the calls never get through.

We’ll see if it works.

Fraud News Update 12.20.16


I grew up in San Diego, a big time military town. It’s home to the Pacific Fleet, Point Loma Sub Base, Coronado, 32nd Street Naval Base, Miramar (where the 1986 movie Top Gun was filmed…Maverick and Goose: “I feel the NEED – The NEED for SPEED!), the Marine Corps Recruit Depot and famous Camp Pendleton Marine Corps base.

I’ve been down to the beaches at La Jolla Shores and Coronado many times watching aspiring Navy SEALS train. Most of the candidates who start this training “wash out” despite being strong, physically fit and tough individuals.

The reality is, that’s the way it should be. Because when the chips are seriously down, as they usually are when these guys are summoned, there’s no room for personal weakness, fatigue or error. Most of us spend our lives avoiding harms way… these guys head right for it.

SEALS are the kinds of people you want bailing your ass out when you’re stranded in some foreign country, being held hostage by terrorists or in a ship overrun by pirates.

Navy SEALS are the “real deal,” best defined by the word: badass! To be one, you have to be the best of the best. Team survival, and those they’re trying to help, depends on each members ability to excel at what they’ve been trained to do.

Pretending to be a Navy SEAL is deplorable but unfortunately it’s not all that unusual. Pretending to be a Navy SEAL while ripping off a charity in need, however, is despicable (and also illegal) which is why a guy like Bill Burley should bother us all.

Burley not only dishonored real Navy SEALS, by pretending to be one, but simultaneously took advantage of individuals who needed real help. It’s what con men do. I’ll say it like it is… this guy’s a fake, a wannabe, a poser and a fraud.

Proving the point, he even worked as a Police Officer for a short period of time, while on probation for another crime, before the background investigation outed him.

Now, thanks to the FBI, local law enforcement and the U.S. Attorneys Office, Burley’s also a convicted felon (again) who’ll be spending the next three years of his life behind bars…and rightfully so.

In light of Burley’s bogus impersonation, and the honorable men whose memories he dishonored, the last Fraud News Update of 2016 is dedicated to former U.S. Navy SEAL David Rutherford (a trainer and highly regarded corporate motivational speaker) and all of his legitimate SEAL colleagues who “lay it all on the line” every day.

These fine men, are not only the “real SEAL deal” but have dedicated themselves, and often sacrificed their lives, for our country and personal freedoms. Copy that?!

For more information on how we can help your businesses prevent enterprise fraud risk, conduct fraud risk assessments, provide fraud training, develop fraud content, reduce major fraud losses and improve operational ROI, contact us to schedule an initial consultation. No obligations…just unique insights from an industry leader.