Fraud News Update 01.23.15

Fraud News

01.23.15 – This week’s edition of the Fraud News Update features: College Crime (The NCAA’s Getting Busy), Pharmaceutical Ethics (No Pill For This), Fraud Squads (The Bureau’s Adding Resources) and Liar, Liar Pants On Fire (Staged Death Charges).

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

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We’ve covered the NCAA and D1 academic fraud issues extensively in past issues of the Fraud News Update blog. Our take is that it’s not showing any signs of slowing down. In fact, the investigations are clearly starting to catch up to the incidents post the giant UNC fraud scandal.

Recently we featured the Dartmouth fraud issue where 64 students were accused of cheating in a “sports ethics” class. How prevalent is the problem?

There are approximately 350 colleges and universities participating in major D1 college sports this school year. Presuming a completely random 10% academic fraud figure amongst participating institutions, there’s an estimated 35 colleges with academic fraud problems. Think that’s far-fetched?

It’s really not an unrealistic crime figure in a total population. In fact, according to this fraud news story, the NCAA is currently investigating twenty (20) schools with academic issues.

When you factor in the historical “known vs. unknown” fraud amounts (otherwise known as the iceberg theory), there are likely more institutions that have academic fraud issues than what’s been uncovered to date.

Expect to see much, much (MUCH) more of this going forward.


This fraud news story suggests that the pharmaceutical industry’s found out the hard way that there are no magic pills which cure ethics problems.

In 2014, according to Associate Attorney General Tony West, “companies putting  profit over patients’ health and misusing taxpayer dollars we’re fine a combined total of more than $200 million.”

The industry ethics problems are strongly supported by the number of False Claims Act case settled in the last 10 year by players in the pharmaceutical industry.

Is the pharmaceutical industry just factoring in the cost of fines and FCA cases into the cost of doing business? If they’re still profitable after being fined, do they even care about ethics?

In a “profit over people” environment, industry ethics challenges will never be solved.

Our Rx: The creation of a new industry Code of Ethics standard.


Old school crimes like bribery continue to be newsworthy stories when it comes to today’s corporate frauds both domestically and abroad.

How big of an issue is it? In this fraud news story, we see one federal agency’s response: create three new squads, in major cities, to add extra investigative muscle to FCPA violations which touch U.S. soil.

What’s behind the new squad creation? Think about it for a minute.

Investigating and prosecuting FCPA fraud cases abroad is filled with all types of legal, budgetary, language and demographic challenges. Handle cases touching U.S. soil and you reduce the number of challenges exponentially.

When it comes to fraud, it’s essential to “be proactive and think outside the box!”


It isn’t actually a crime to fake your own death. Everyone knows that.

But did you know that when someone fakes their own death, and gets caught, mail fraud is almost always one of the charges? Proceeds from the fraud are mailed between states. Interstate letters and calls not only enhance the mail fraud charges but bring other federal charges like wire fraud as well.

That was the case in this fraud news story about an alleged staged death abroad which resulted in a $2,000,000 life insurance claim and payout.

While “someone” actually died, the reports of the husband’s demise were greatly exaggerated and officials are now trying to discover who the dead body really was.

Things aren’t always what they appear and when it comes to big dollar life insurance claim payouts there’s always a motive and someone willing to “fake it!”

Fraud News – The Bottom Line

Fraud – empowering people to break the law. It’s a way of life for some and every fraud has a story. At Fraud Solutions, fraud is our world and we’re passionate about prevention. Being proactive is key, so, follow us each week as we cover the fraud beat with added insights, information and unique commentary on stories making the fraud news.

Those are our insights. What are yours?

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