There’s something fascinating about people who are capable of orchestrating large-scale financial crimes.
The excessive lifestyles they adopt, the desperate attempts to remain undetected and the sheer focus of accumulating a huge personal fortune makes them at once deplorable yet somehow impressive. We take a look at ten of the most devious fraudsters of the past 100 years.
Bob Vesco is one of the US’s most notorious financial scammers. With charges against him including fraud, conspiracy and drug smuggling, Vesco fled the United States to live in various Caribbean and Central American locations that he could not be extradited from.
He made Cuba his home in 1982, but in 1996 was indicted by the government there for fraud and other dubious economic activities. He died in Havana in 2007 while serving a 13-year sentence.
Mr Ponzi was such an illustrious scammer that he has the dubious honour of having had a criminal activity named after him.
The Italian businessman implemented a scheme in which investors were told they would receive between 50-100% returns within a certain time period. Although Mr Ponzi claimed this was possible through legitimate means, he was simply paying early investors with the money provided by later investors – a system doomed to fail. It did, taking five banks with it, and the term “Ponzi scheme” was born.
A later proponent of the Ponzi scheme, Bernard Madoff was formerly the non-executive chairman of the NASDAQ stock exchange. With overall losses to investors estimated at $18 billion, this is one of the largest financial scams in US history. A prison sentence to reflect the scale of his crimes leaves Madoff due for release from prison in 2139!
Ms Chadwick was born in Canada in1857. By claiming to be the illegitimate daughter of wealthy steel magnate and philanthropist Andrew Carnegie, Chadwick obtained bank loans other debts to the tune of $10-20 million. She enjoyed a lavish lifestyle in Ohio before being discovered and sent to prison in 1906, where she died a year later aged 50.
After a series of smaller swindles, Mr Musica (also known as F. Donald Coster) surpassed himself with the McKesson & Robbins scandal of 1938. By using fake names he ran two companies, one of which – McKesson & Robbins – he operated with his brothers, falsifying sales documents and creating around $20 million of nonexistent assets.
Bizarrely, Musica also made a success of running the company’s legitimate operations, with over $60 million of genuine assets. He committed suicide in 1938 after the SEC investigated his activities and uncovered his various identities.
Whitacre’s is a great story involving some pretty substantial hypocrisy on his part. Between 1992-95 Whitacre was a snitch for the FBI, reporting against his company Archer Daniels Midland (ADM), which was being investigated for price fixing.
Apparently unimpressed by the activities of its employee, ADM looked into Whitacre’s own business dealings, then requested that he be investigated by the FBI for embezzlement. He was found guilty of various frauds totaling $9.5 million and locked up for almost nine years!
Ivar Kreuger, the Swedish Match King
Like so many of the people on this list, Krueger was a hugely accomplished businessman, running more than 400 companies at one time and generating significant legitimate profits. However, Krueger was also a gambling man at heart and was not averse to using forgery and deceit to bolster his position, shifting huge sums of money around with very few records taken.
Some of Krueger’s companies – including telecoms giant Ericsson and Swedish Match – still exist today, but Krueger’s business practices provoked the creation of the US’s accounting principles in 1930s to keep tabs on such activities. Although certainly a shrewd businessman, Krueger’s recipe for success – “Silence, more silence, and still more silence” – gives a good indication of the legitimacy of many his methods.
John G Bennett Jr.
Another Ponzi schemer here, with the added gumption of doing it all in the guise of philanthropy…
Bennett set up his scheme by telling people that instead of donating money directly to charities, if they donated it to his “Foundation for New Era Philanthropy” then he would double their donation over a given time. He fooled people by saying that he had a number of secret donors who had promised to match amounts given. As the scheme grew, larger organisations began to get involved and Bennett expand his operations. By its inevitable collapse in 1995, the scheme had raised $500 million and embezzled $135 million.
Another financial hero/villain here! Michael Milken is celebrated for his contributions to medical research and to economic growth, while also being criticised as the epitome of Wall Street greed, pleading guilty to six securities and reporting violations in 1989.
Mr Milken originally received a ten year sentence but only served two thanks to cooperation with the prosecutions of other rogue financiers, as well as for good behaviour.
“Crazy Eddie” Antar
The “Crazy Eddie” chain of electronics stories was co-founded by Eddie Antar, and although the chain appeared successful, achieiving $300 million in sales from 43 stores at its peak, business practices were far legitimate. When this was discovered, Antar cashed in his shares and resigned but eventually he was brought to justice, although he only served two years of his eight-year prison sentence.
So this just shows how careful you have to be when choosing financial providers and advisors! Needless to say, The Mortgage Broker is against all forms of illegality and adheres to the very highest professional standards in all services.