Oh My Fraud

There may be errors in spelling, grammar, and accuracy in this machine-generated transcript.

Greg Kyte: Two things are infinite the universe and human stupidity. And I'm not sure about the universe. Albert Einstein.

Caleb Newquist: Never argue with stupid people. They will drag you down to their level and then beat you with experience. Mark Twain.

Greg Kyte: Stupidity combined with arrogance and a huge ego will get you a long way. Chris Lowe.

Caleb Newquist: Think of how stupid the average person is, and realize half of them are stupider than that. George Carlin. [00:00:30]

Earmark CPE: If you'd like to earn CPE credit for listening to this episode, visit earmark Cpcomm. Download the app. Take a short quiz and get your CPE certificate. Continuing education has never been so easy. And now on to the episode.

Greg Kyte: Hello and welcome to Oh My Fraud, a true crime podcast where [00:01:00] statistically our criminals are 2% dumber at committing fraud than external auditors are at catching fraud. I'm Greg Kyte.

Caleb Newquist: And I'm Caleb Newquist. That statistic Greg, comes from the a c f report to the nations on occupational fraud and abuse. Am I right? Yes, that's exactly right.

Greg Kyte: Uh, the report says that 5% of frauds are initially detected by accident, but only 3% are detected by external auditors. Ergo, fraudsters [00:01:30] are 2% dumber at committing fraud than external auditors are good at catching fraud. But, Caleb, before we get into it, uh, you get if we read a quick listener review.

Caleb Newquist: I am, I am, I'm I'm fine with that. Yes.

Greg Kyte: Not you're kind of on the fence. It sounds like. It seems like you're kind of on the fence. It's a good it's a great review.

Caleb Newquist: Oh, okay. Yeah. It is. Yeah. Okay, great.

Greg Kyte: Yeah. Uh, it says, uh, I did fraud investigations for over a decade. All my friends tell me I should do a [00:02:00] podcast about my stories because it would be fun and be a good side hustle. Except you guys have already done that, and you do it way better than I could and are way more funny than I am. So I have to tell my friends that they need to listen to you instead. Thanks for stealing a potential revenue stream from me that I'm sure is making you more money than Rita Crundwell ever got.

Caleb Newquist: Not to give too much away, but both Greg and I have started Quarterhorse breeding empires with all the money we've earned from hosting the Oh My [00:02:30] Fraud podcast.

Greg Kyte: I was I was just I was just brushing a Quarter Horse right before the podcast, as a matter of fact, to make sure its coat was shiny.

Caleb Newquist: Show ready?

Greg Kyte: Show ready? Exactly. Yeah. Uh, if and if you. I mean Caleb. Yes, literally. If you round up, we have made $35 million from our ads for the South Carolina Association of Certified Public Accountants.

Caleb Newquist: That's That's true. Thank you.

Greg Kyte: You have to. You have to. Round.

Caleb Newquist: Way round.

Greg Kyte: Way way up. [00:03:00] But yeah, if you if you do round up to the closest $35 million, we we have we've done it.

Caleb Newquist: We've done.

Greg Kyte: It. Yeah. We're killing it.

Caleb Newquist: So if you are bitter that. Oh, my fraud stole your potential side hustle, please take a minute to write us a review. Who knows, we might even read yours on the show. Also, if your firm is looking for in-house ethics or fraud training, that doesn't suck. We also do that.

Greg Kyte: We also do keynote addresses at events and conferences, and you can hire us to put on a pretty fantastic webinar too.

Caleb Newquist: Yeah, [00:03:30] we just did one. We did? Yep.

Greg Kyte: Not too long.

Caleb Newquist: Ago. It was pretty fun. Yeah. Anyway, if you want more info on pricing and availability, send us an email at oh My fraud@earmarks.com and we'll let you know.

Greg Kyte: Yeah. Just send us that email.

Caleb Newquist: Send the email.

Greg Kyte: What are you waiting for?

Caleb Newquist: Right.

Greg Kyte: Uh, what do they say? Operators are standing by.

Caleb Newquist: Yeah. That's it, that's it. Operators are standing by. Um. [00:04:00] Okay, Greg. Changing subjects. Uh, today is a special day because it is our first ever, uh, dumb fraud roundup episode.

Greg Kyte: That.

Caleb Newquist: Maybe, maybe we'll come up with a better name for it before this episode launches. But, yeah, it is a roundup of dumb frauds.

Greg Kyte: Yeah. That's right. Uh, in today's episode, instead of diving into just one fraud case, we're going to look at four fraud cases, all of [00:04:30] which stood out to us as being particularly dumb.

Caleb Newquist: Yeah. And, you know, maybe not entirely dumb, but stupidity makes an appearance.

Greg Kyte: Yeah, it's one of the main characters. So we hope you enjoy today's dumb fraud roundup.

Caleb Newquist: Dateline. Hialeah, Leah, Florida. A few fun facts about Hialeah. I hope I'm saying that right. I think I'm saying that right.

Greg Kyte: That's how I would say it.

Caleb Newquist: Yeah. [00:05:00] All right. Hialeah is the sixth largest city in Florida. As of the 2020 census, it is the second largest city in the Miami metropolitan area. Hialeah has the highest proportion of Cuban and Cuban American residents in the United States. They make up 84% of the city's population.

Greg Kyte: That's a large percentage.

Caleb Newquist: That is a large percentage. Among the many notable folks to come out of Hialeah are actress Catherine Keener. Do you know who Catherine Keener is? Greg. Oh my.

Greg Kyte: Gosh. Catherine Keener of [00:05:30] the keener family. Yes. She started in, uh, in movies or television. Awesome.

Caleb Newquist: Fantastic. Yeah. Uh, actor Vincent D'Onofrio. Am I saying that right? That's a hard one. I hate it when people have apostrophes in their names.

Greg Kyte: You just you picked you picked a story with the hardest, Uh. Proper nouns.

Caleb Newquist: Proper nouns? Yeah. Yeah. Anyway, he's best known for, uh, Law and Order, criminal Intent. Oh.

Greg Kyte: All right.

Caleb Newquist: But he's in, he's in. He's actually [00:06:00] actually going way, way back. He was um Private Pyle in Full Metal Jacket.

Greg Kyte: Oh okay. That's that. Well that's Vincent D'Onofrio.

Caleb Newquist: It didn't offer for sure.

Greg Kyte: Dinofrio our correspondent from Hollywood here to make sure.

Caleb Newquist: Live from the red carpet.

Greg Kyte: How do you say it again. D'onofrio D'Onofrio. Perfect. We got people. We got people yelling at their podcast [00:06:30] app going, dinofrio, you stupid sons of bitches!

Caleb Newquist: Okay, this one I know I can get, right? Another famous hula hula hula an I. Man, that's a hard. What am I doing? Why am I trying to say all these hard words? Anyway, someone else that is famous that came out of Hialeah. Grammy winning singer songwriter Jon Secada. And finally Harry Wayne Casey, the founder and lead singer of KC and the Sunshine Band.

Greg Kyte: You gotta love KC and the Sunshine Band. [00:07:00] Yeah, I mean, when it comes to disco music that that sticks around can't be hard to beat. Kc and the Sunshine Band holds up. It holds up for sure.

Caleb Newquist: And maybe we'll sneak into a, you know, a Quentin Tarantino soundtrack, right?

Greg Kyte: Exactly, exactly. Okay.

Caleb Newquist: Finally, the city of Hialeah's official mascot is Leo the Flamingo. It's true. Leo the Flamingo became the city's official mascot in April 2020. For the city's official page for Leo states. [00:07:30] Quote. With her elegant beak, she's a master at savoring the crispy golden croquetas, whether stuffed with ham, cheese, or anything in between. But what's a croqueta without a cafecito to wash it down? Leo's cafecito addiction is legendary. She's often spotted perched at the local ventanita, sipping her tiny cup of strong Cuban coffee. Now, I don't know about you, Greg, but I do want to see an Overcaffeinated flamingo. I do, I do. Like, just just like jacked. Yeah. [00:08:00] Like jacked.

Greg Kyte: Right? Just flamingo fidgety where they can't stand on one leg because they're just too busy shaking.

Caleb Newquist: Where they're just on two legs because they just can't stop shaking.

Greg Kyte: Exactly. I the thing that strikes me is that is a lot of backstory for a city mascot that just came into being very like earlier this year.

Caleb Newquist: Yeah, yeah. I don't know. They're excited. It has an Instagram account. Go check it out. Leah the flamingo. And, you know, probably over caffeinated.

Greg Kyte: Yeah. Subscribe. [00:08:30]

Caleb Newquist: Yeah. As for the purposes of our show, Hialeah is, as we mentioned, part of South Florida and South Florida is, quote, ground zero for health care fraud, according to a CNBC report on Medicare and Medicaid fraud from 2003. Excuse me. That is a report on Medicare and Medicaid fraud from 2023. Oh, you.

Greg Kyte: Made a you made a great kite style mistake there.

Caleb Newquist: I totally made a great.

Greg Kyte: Yeah, great.

Caleb Newquist: Great kite mistake.

Greg Kyte: You see the number [00:09:00] and you still say it wrong. Accounting Today. Yeah.

Caleb Newquist: Anyway, that same report says that taxpayers lose more than $100 billion in Medicare and Medicaid fraud every year. And some people even think that that estimate might be low.

Greg Kyte: Geez, that's that's an eye $100 billion billion.

Caleb Newquist: Yeah. That's billion.

Greg Kyte: That is eye popping. That's a.

Caleb Newquist: Lot right? Yes. Greg, I have to ask, do you have any idea [00:09:30] how much we spend on Medicare in the United States annually? I'm just talking about Medicare now. Um, yeah. Actually, no. I'm sorry. Medicare and Medicaid together.

Greg Kyte: Uh, $101 billion.

Caleb Newquist: That would be.

Greg Kyte: Funny. 100 billion of it is fraud, but 1 billion of it is going to the people who really need it the most.

Caleb Newquist: Yeah. Uh, actually, no, but it's that is, that is, it's it's an it's an enormous amount of is it in the trillions. It is actually. [00:10:00]

Greg Kyte: Oh, really? Yeah.

Caleb Newquist: Medicare and Medicaid spending together in 2022 is about 1.7 trillion. Wow.

Greg Kyte: Dollars. Okay, well, you know that I my day job. I am the accountant for a group of medical office buildings. Yes. And I do know how onerous Medicare and Medicaid, uh, like their standards are on, uh, on on doctors. Yeah. And and it's funny because a lot of doctors don't even take [00:10:30] Medicaid or Medicare patients because the margins are too low. Right. Which is also interesting considering the volume we're just talking about. Yeah. Medicare and Medicaid spending.

Caleb Newquist: Yeah. The government the federal government drives a hard bargain.

Greg Kyte: Yeah they do.

Caleb Newquist: So for this dumb story, it isn't so much that Medicare fraud is dumb. Medicare is quite serious problem, actually. But, you know, play along. Okay. Yeah, we'll get to the good stuff. Right? Um, so according [00:11:00] to a Department of Justice press release in February through April 2022. Hallelujah. Hallelujah. Hallelujah. Hallelujah. President Ernesto Cruz Gravitron owned a company called Zico Enterprises. Do you think I'm saying that right? It's Zico. Zico? Yeah.

Greg Kyte: I'd say Zico.

Caleb Newquist: Zico. Enterprise. Okay, again.

Greg Kyte: You picked the best proper nouns.

Caleb Newquist: Man. So many. Okay. Anyway, Zico claimed to provide durable [00:11:30] medical equipment to eligible Medicare beneficiaries. All right. Pause. Greg Kite, are you familiar with durable medical equipment?

Greg Kyte: More than I than I would hope that I would be okay. I suffer from sleep apnea, so my CPAp machine is a prime example of durable medical equipment. Right?

Caleb Newquist: So again, let me just see, since you are very familiar with this, I'll just try to confirm my understanding. But essentially it [00:12:00] is medical equipment that someone can use repeatedly. It isn't like a one time use thing. Like, uh, I don't know, like those little things, those the, the caps that they put over, the thermometers that they stick in your ear. Right, right, right. We're talking wheelchairs. We're talking crutches, uh, CPAp machines, uh, oxygen tanks, stuff like that. That's that is durable medical equipment.

Greg Kyte: Yeah, yeah, a albuterol inhaler. Not a not durable [00:12:30] medical equipment.

Caleb Newquist: No, sir. Definitely not. Anyway, um, anyway, here's more from that press release. Uh, the complaint alleges that Zico, in only a two month period in 2022, submitted approximately $4.2 million in fraudulent healthcare claims to Medicare for durable medical equipment that Zico never provided and that Medicare beneficiaries never requested. As a result, Medicare paid Zico over $2.1 million. For example, according to the claims that Zico submitted [00:13:00] to Medicare. One physicians purportedly prescribed DME for Zico for approximately 145 Medicare beneficiaries, and Zico billed Medicare for 1 million for DME referred by this one physician. But according to the complaint, none of those 145 beneficiaries were in fact patients of that physician, and that physician never prescribed any of the billed for DME.

Greg Kyte: So wow.

Caleb Newquist: That is actually pretty dumb if I understand it, right?

Greg Kyte: Well, and I'm trying to [00:13:30] just do the math because it's a two month period. So we're talking 60 days. Yes. And we're talking Hundred and 45 patients? Yes, I guess you could. I guess you could. I guess it's not too hard to take the weekends off. 145 patients in 60 days. Yeah.

Caleb Newquist: Yeah, but you're not. Are you working the weekends?

Greg Kyte: No, you're not working the weekends. So let's say it's, uh, 45 days. Okay. You're still. That's just three patients a day if you're working all the weekdays. Yeah. So. Yeah. All right. Yeah. So [00:14:00] it's it's it's it's reasonable. Okay. But, uh, but also obviously fraudulent. Yeah. And dumb.

Caleb Newquist: So I just want to again, I want to make sure that the audience understands this, but Zico submitted a bill to Medicare for millions of dollars in reimbursements for DME that they didn't provide. Yeah, to beneficiaries who never requested them. Right. Some of which weren't even patients of [00:14:30] the physician who never prescribed the DME in the first place.

Greg Kyte: Yeah.

Caleb Newquist: That's dumb. Yeah, that's real dumb.

Greg Kyte: You're you're you're.

Caleb Newquist: Just. I mean, I can see it's confusing though, too. So, like, I understand maybe while that initially got past some people, but it didn't get past them for long, right.

Greg Kyte: That's something that's going to get caught quickly upon if there's any scrutiny.

Caleb Newquist: Right. All right. But it gets a little extra dumb when you hear about what happens next. Greg. Okay. [00:15:00] Okay. Yep. On or around June 8th, 2022, the US Coast Guard and the US Customs and Border Protection officers located Gravitron aboard a broken down jetski in the waters south of Key West, headed in the direction of Cuba, roughly 90 miles away. Gravitron was aboard the jetski, along with one other individual who was known to law enforcement to be an alien smuggler. The jetski was outfitted with a special fuel cell to allow for long trips [00:15:30] and within the compartments of the jet ski. Law enforcement discovered a trove of food and water bottles, so maybe they could have made it to Cuba. Greg. But as the press release said, the jet ski broke down. And I don't know about you, but if I'm going to ride a jet ski 90 miles to Cuba, I'm going to be sure that that jet ski can make it right.

Greg Kyte: If I just stole 2.1 million, million dollars.

Caleb Newquist: Million dollars.

Greg Kyte: From Medicare, I think I'm going to [00:16:00] buy the best. The jet.

Caleb Newquist: Ski.

Greg Kyte: That can get me to Cuba will not break down. Yeah, get me, get me the best non break downable jet ski that that $2.1 million can buy. No, he.

Caleb Newquist: Took the Hoopty jet ski.

Greg Kyte: Right. Right.

Caleb Newquist: Why? Why did he take the Hoopty jet ski?

Greg Kyte: Yeah.

Caleb Newquist: I mean, yeah, at the very. At the very least, he could get the the Toyota jet ski, right? Yeah. They can go 200,000 miles without breaking a sweat.

Greg Kyte: Right. Exactly, exactly. Like, you don't have to change it. Changing the oil [00:16:30] on the jet ski is.

Greg Kyte: Justa suggestion, right? Yeah.

Caleb Newquist: Yeah, yeah. You can really, you know, put 9000 miles on that change, right?

Greg Kyte: Exactly.

Caleb Newquist: And also, here's the other thing. Why? Why is his travel buddy a human trafficker?

Greg Kyte: Oh, he was a human trafficker.

Caleb Newquist: Well, it's not an alien smuggler.

Greg Kyte: Oh, okay. Yeah, I guess we're not taking.

Caleb Newquist: We're not talking about little green men, Greg.

Greg Kyte: Right. I guess I saw that, and I didn't that those words didn't make sense together. So my brain just. Yeah, we flopped over. Yeah. So. Okay. [00:17:00]

Caleb Newquist: I don't know why he's letting a human trafficker try to tag along.

Greg Kyte: Right.

Caleb Newquist: Because if you're making a break for it on a 90 mile jet ski trip, you're going to need somebody who can fix anything under any circumstances, right? Like, shouldn't he should have MacGyver on that jet ski. Yeah.

Greg Kyte: Macgyver would be great. B.a. Baracus would be amazing. Oh.

Caleb Newquist: Who's that?

Greg Kyte: Oh, he's. He was. That was Mr. T from from the from the A-Team. Yeah. Yeah, he was there. He was. I mean, he was the muscle, but. Yeah, if [00:17:30] I remember right, he also fixed the shit.

Caleb Newquist: Yeah, he fixed everything. Yeah, yeah. And, I mean, maybe he'd have to leave, you know, all the gold chains behind, but whatever. At least you would. At least you wouldn't break down and be stranded.

Greg Kyte: No, no, no. If you're fleeing the country, gold chains are not going to be anything but helpful for you. Yeah, yeah.

Caleb Newquist: Oh, man. All right. A judge ordered Grayvoron to be held without bail until trial, because apparently, he's willing to give the jet ski getaway a try. And as of this [00:18:00] recording, the case is still pending.

Greg Kyte: Dateline Cheltenham, England, 2002. If you can't remember, 2002 was when Queen Elizabeth celebrated her Golden Jubilee, which was her 50th year as the Queen of England. Also in early 2002, England had just gotten through its foot and mouth disease crisis. Caleb, do you remember the foot [00:18:30] and mouth disease crisis?

Caleb Newquist: Only the one that's happened in my own home.

Greg Kyte: Oh, wait. What?

Caleb Newquist: Yeah, sure.

Greg Kyte: Oh, because you have toddlers and they put their feet in their mouth? Yes.

Caleb Newquist: Of course. Great.

Greg Kyte: Yeah. No, this.

Caleb Newquist: Is. You remember.

Greg Kyte: This? Oh, I do, I do. And foot and mouth disease is not that. Oh. Foot and mouth disease, rather, is a highly infectious disease that can be fatal to cows and sheep and pigs. Uh, symptoms include fever, shivering, lameness, drooling and smacking [00:19:00] lips. Uh, and this got out of hand in England. Uh, it's starting in 2001. Like I said, they got over it in early 2002, but they had to slaughter about 6 million animals to control and contain the spread of the disease. Mm. Uh, but fortunately, uh, foot and mouth disease does not affect horses. And coincidentally, this story involves horses. Mm.

Caleb Newquist: Can we just stop for a second? How does the lameness show up? Are they just like just wearing really kind of like, [00:19:30] you know, nerdy clothes or. Yeah. Like.

Greg Kyte: Yeah. High waisted jeans.

Caleb Newquist: Oh, okay. All right. Yeah.

Greg Kyte: Just sheep and high waisted wool pants.

Caleb Newquist: Like wool. Yeah. Okay. Yeah.

Greg Kyte: All right. That's most of it. Or like.

Caleb Newquist: Or like maybe, uh, or, uh, members only jackets or something.

Greg Kyte: Yeah. Uh, glasses that are taped together because they were broken by bullies.

Caleb Newquist: Right. Okay.

Greg Kyte: But after the end of both the foot and mouth crisis and the Queen's Golden Jubilee, a Cheltenham, [00:20:00] England, resident named Jacqueline Boatswain ordered a new debit card from her bank. And I don't think her reason for ordering that debit card had anything to do with either foot and mouth disease or the Golden Jubilee, but she just needed a new debit card, and after a while she realized that the debit card hadn't come and she became concerned as any of us would be, and that the cart had been stolen. So she checked her bank statement. But [00:20:30] this is where things started to get weird. Caleb. Okay, because you know, the debit card doesn't come. You're worried it got stolen. You're worried somebody drained your bank account. Yeah, but instead of finding her bank account drained, she found that, strangely, an unexpected 291.40 pounds had been deposited into her account by Ladbrokes.

Caleb Newquist: That's not what you would expect.

Greg Kyte: No, but it's also delightful to say 291.40 [00:21:00] pounds.

Caleb Newquist: It.

Greg Kyte: Is. Makes me happy. All right, so you might be asking Caleb, what the hell is Ladbrokes.

Caleb Newquist: Yeah. What is Ladbrokes? Greg.

Greg Kyte: I'm so glad you asked. Oh good. It's it's a gambling company. Oh. In the UK it has over 2000 retail shops. And from what I was able to gather. And I'm sure that my understanding is incomplete at best. It's like a micro sports book and [00:21:30] maybe has like some computer gambling terminals that the computer gambling terminals that I found in images on a Google search looked a lot like the computer gambling terminals you would find at a gas station in Las Vegas. That's anywhere in Nevada. Really? Yeah. So that's that's what we're up against. And they were they were tiny little like, it's just a little postage stamp of a shop where gambling addicts could go to [00:22:00] become broke lads. That's it's called Ladbrokes. And I go, that, was that on purpose or is somebody whose last name Ladbrokes and just went into the gambling business? It's hard to tell. You can't really. I don't know from the history on Wikipedia they didn't get into that.

Caleb Newquist: That's too bad because I'm sure whatever the story is, I'm sure it's a fine. I'm sure it's.

Greg Kyte: Fine. And I'm sure people throughout the UK love to joke about broke lads at Ladbrokes, right?

Caleb Newquist: Look at [00:22:30] all the broke lads over at Broke Lads.

Greg Kyte: Ladbrokes.

Caleb Newquist: Ladbrokes, right. Look at all the broke lads over at Ladbrokes.

Greg Kyte: There it is lads. Nailing it. Everything about Ladbrokes. Uh anything speculative that I may have said about Ladbrokes. The one thing that's absolutely sure that I know for a certainty is that they do off site betting for horse racing. Uh, you know, horses. You remember those?

Caleb Newquist: I do.

Greg Kyte: The animals. The one farm animal that was completely immune from foot and mouth disease.

Caleb Newquist: That's [00:23:00] right, that's right.

Greg Kyte: Uh, at this point in the United Kingdom, cow racing and sheep racing and pig racing had completely been shut down. But horse racing still going full steam, going.

Caleb Newquist: Strong, going.

Greg Kyte: Strong. Uh, the problem with the Ladbrokes mystery deposit into Jacqueline Boynton's account is that Jacqueline Boatswain doesn't gamble. At least she hadn't gambled at Ladbrokes recently enough to have explained the 291.40 pounds that was deposited [00:23:30] into her account. So, Caleb, yeah, turns out what had happened is that her debit card had been stolen right out of her mailbox by a gentleman wanker named Andrew Cameron. Uh, not to be confused with former British Prime Minister David Cameron, who gambled and lost on Brexit. So, so Andrew Cameron, after stealing Jacqueline Benson's debit card, he went straight to a Ladbrokes and he placed 250 pound [00:24:00] bets on two horses and he ended up winning on both bets, which first off, that's crazy. Yeah. But also since he placed the bet using a debit card, Ladbrokes policy is that the winnings have to go back on the debit card and you can't get them in cash. It's a matter of fact, the only way. If you place a bet on a debit card that you can get cash is if you have a picture ID that matches the debit card. But unfortunately, Andrew Cameron [00:24:30] had only stolen the debit card and had not also stolen Jacqueline Benson's, uh, driving license.

Caleb Newquist: Can't win them all.

Greg Kyte: You can't. So Andrew Cameron pleaded guilty to stealing the card and was sentenced to 12 months probation. And my favorite part of the story is that Jacqueline Boatswain was allowed to keep the 291.40 pounds that Andrew Cameron had won on her behalf.

Caleb Newquist: Yeah, for the, you know, [00:25:00] for the trouble.

Greg Kyte: For the trouble also for poetic justice. Uh, misuse. Caleb, we talk a lot on this podcast about misuse of credit cards, uh, as a kind of a regular type of fraud that comes up. Um, and Jacqueline. She did a lot of things right. She kept track of when the card should have arrived. She checked her account when it didn't arrive in a timely fashion, and I've got to assume that she canceled the card as soon as she saw the weird stuff [00:25:30] going on in her account. Um, but one of the things that that I think we, I don't know, I don't remember us talking about this specifically or in depth before, but reconciling your bank statement especially, like even your credit card statement. Yep. It's imperative to catching credit card fraud, uh, regardless of whether you're talking about individuals or businesses. And I'm shocked. I don't know if you're if you're the same way as me. I'm shocked at how many people don't keep receipts or any kind of records about [00:26:00] the spending that they do on their credit card. They just assume that what comes through on their card is legit, and they just accept it at full value. So, um, yeah, don't maybe don't do that if you if you want to avoid credit card related fraud. Also, one of the things this has never come up on the podcast before locking mailboxes. It's a great way to prevent credit card fraud. There you go. At least to prevent those credit cards or debit cards from being stolen.

Caleb Newquist: Dateline [00:26:30] Southeast Texas, circa 2009. There's a widely held study out there that found some large number of American drivers. Something like 80 or 90% believe that they are above average at driving. Greg, have you heard about this?

Greg Kyte: I have, yep. Yeah, I'm familiar now.

Caleb Newquist: Yes, this is mathematically impossible, but I don't know [00:27:00] if you've noticed this, but on a daily basis, I see lots of bad drivers on the road. Every time I'm out driving.

Greg Kyte: Right.

Caleb Newquist: So that's pretty anecdotal and not at all scientific, but I guess what I'm saying is that the common sense would tell you that the 80 or 90% is too high, right? Especially when you know the fact. The fact is that the vast majority of accidents, more than 90%, are caused by human error.

Greg Kyte: Right?

Caleb Newquist: Like it isn't. It isn't the car's fault.

Greg Kyte: Right, right. Not [00:27:30] everybody's driving a Cybertruck.

Caleb Newquist: That's right. Conversely, no one ever expects that someone caused a car accident on purpose.

Greg Kyte: Correct.

Caleb Newquist: Right. Okay. In October 2009, Andy Lee House, a proprietor of a salvage yard for exotic cars, acquired a 2006 Bugatti Veyron. Now, in case you're not familiar, and I was not, I will regale you now with some of this car's specifications and performance. Because [00:28:00] I'm not gonna lie, it's pretty impressive.

Greg Kyte: Yeah. Bugattis have come up on the podcast before, have they? Yeah. Wow.

Caleb Newquist: Wait. I do not recall.

Greg Kyte: I think so. Well, maybe. Maybe not. Maybe I'm wrong. I thought in the Polygamist Fraud episode. Oh, I think I think they might have bought somebody, might have bought a Bugatti. So. Yeah. All right.

Caleb Newquist: Uh, there have been many lambos Lambos have come up on many occasions. Yes. Anyway. But no, we are talking about a Bugatti Veyron. Okay. Uh, first, it has a [00:28:30] eight liter quad turbocharged W16 cylinder engine. What is a W16, you ask?

Greg Kyte: I want to know what is a W16.

Caleb Newquist: I'm gonna tell you. It's essentially two V8 engines bolted together.

Greg Kyte: So it's something that's necessary for the person with the tiniest penis ever.

Caleb Newquist: Yeah. Uh, yeah. Two V's make a W and two eights make a 16. See, cars aren't really complicated at all.

Greg Kyte: I just can't even imagine the size hood that must be on this [00:29:00] car. Yeah. Is it does it take up two lanes on the freeway because you've got two v-8s bolted together?

Caleb Newquist: Moving on. The Veyron has a Quote dual clutch, direct shift computer controlled automatic transmission having seven gear ratios with the magnesium paddles behind the steering wheel, and a shift time of less than 150 milliseconds. Did I just say cars weren't complicated?

Greg Kyte: Yes.

Caleb Newquist: Okay. They're complicated.

Greg Kyte: Right?

Caleb Newquist: And in case you're curious to replace the transmission would cost you $120,000.

Greg Kyte: Chump change.

Caleb Newquist: You [00:29:30] know where I grew up? In Nebraska, Greg. You can get houses for far less than $120,000.

Greg Kyte: Well, and just normally you could get a three normally priced cars for the price of one transmission for a Bugatti Veyron.

Caleb Newquist: Yeah, you could live you you could, you could move to rural Nebraska. You could take $120,000, move to rural Nebraska, get a house and probably three cars.

Greg Kyte: Yeah, yeah.

Caleb Newquist: And maybe still have money left over.

Greg Kyte: Right, right. So, yeah. Expensive cars.

Caleb Newquist: Expensive. Yeah. Okay. What else? [00:30:00] It has permanent all wheel drive.

Greg Kyte: Of course. Yeah.

Caleb Newquist: Not. It's no Subaru, but whatever. It features Michelin Pax run flat tires that cost $25,000 per set, right?

Greg Kyte: So it cost the equivalent of a Subaru just for a set of tires?

Caleb Newquist: Yes, just for the tires weighs over 4,000 pounds.

Greg Kyte: So light.

Caleb Newquist: Top speed. 253mph. One of the fastest production cars ever made. Yep. It [00:30:30] was named car of the decade by the BBC TV show Top Gear. Greg, would you like to guess what this car costs?

Greg Kyte: No, because I already saw it in the show notes. Yeah.

Caleb Newquist: $1.6 million.

Greg Kyte: That's a lot of dollars. A lot of money. That's for a car. Yeah. Yeah. Yep.

Caleb Newquist: Anyway, on a pleasant Wednesday in early November 2009, Andy Howes was driving his Bugatti Veyron in, in or around la marque, Texas, when he suddenly veered off into a saltwater [00:31:00] lagoon. Oh. Apparently he had been distracted by a low flying pelican. At least that's what he told the website Jalopnik, who somehow got wind of the story.

Greg Kyte: So he's a he's an avid bird watcher, and that was one of the last ones on his card. He's like, is that is that the, uh, is that the, uh, pink breasted, uh, Gulf Coast pelican? Because I need that one.

Caleb Newquist: Yeah. Yeah. Anyway, the good news is that Andy got [00:31:30] out of the car safely. The bad news is he left the engine running, and that, of course, sucked a bunch of salt water into the car, which, of course, ruined the car.

Greg Kyte: Okay.

Caleb Newquist: But more good news. He had insurance, thank goodness.

Greg Kyte: I mean, for if your car is going to cost that much freaking money and you're not insured, you're the. Then you have to be on the dumb podcast. Uh, dumb fraud podcast.

Caleb Newquist: Right, right. Anyway, he filed a $2.2 million claim the next day. [00:32:00] Okay. Unfortunately for Andy, Someone had witnessed the whole incident and captured it with their iPhone, and the video is conspicuously absent of any pelicans.

Greg Kyte: Okay, no zero Pelicans, no.

Caleb Newquist: Pelicans, no Pelicans anywhere. And they were en.

Greg Kyte: Panoramic with that iPhone. So you'd see a pelican.

Caleb Newquist: Well you know it's 2009. So iPhones were relatively new.

Greg Kyte: At the time. That's true.

Caleb Newquist: Good point. Yeah yeah good point. But but but the but the video which is in the show notes which [00:32:30] you should watch I highly, highly recommend that you watch the video. Um, in the details of the video, the, the guy who posted it recorded the video. He, he says he, he used an iPhone, so.

Greg Kyte: Okay. Um, iPhone. Not even a sponsor of the podcast?

Caleb Newquist: No. Not even. There you go. Should be iPhones recording dumb frauds. Okay. House. Andy House claimed it was all a misunderstanding and that he was reaching for his phone. And that's why he drove into the lagoon. [00:33:00] Not surprisingly, not everyone bought this story, and there they were, quite suspicious of him crashing an Overinsured ultra luxury car to collect on the insurance. Right?

Greg Kyte: Yeah. Which that doesn't make sense. I guess we didn't point out that if you've got a $2.2 million claim on a car that costs $1.6 million new, but yours was, uh, three years old. Yeah, I think he bought.

Caleb Newquist: It for a million.

Greg Kyte: Okay, [00:33:30] so, yeah, very, very overinsured car.

Caleb Newquist: Yes. Nevertheless, in 2010, House bought a new Veyron, perhaps putting some rumors about the cause of his crash to rest. But then in 2011, House was sued by Philadelphia Insurance, claiming that he crashed the car to collect the big insurance payday of 2.2 million. Makes sense. The car doesn't really change hands for much more than 1.5, but something [00:34:00] was afoot. Philadelphia even claimed that House tried to pay someone to steal the car and burn it, so he could collect on the insurance. I don't know how they found that out, but that is hilarious.

Greg Kyte: That's that. That's classic insurance fraud right there. Yeah. Steal it and burn it.

Caleb Newquist: Blow it up. In 2012, Jalopnik reported on the delay of the fraud trial between Philadelphia Insurance and Andy House. Included in that story was this little gem quote. After the accident, [00:34:30] House also sent us an image of his garage, and it shows his new Veyron, a Lamborghini Gallardo Superleggera. I don't know if I'm saying that right. A Lamborghini Murcielago Lp640 and a Porsche 911 GT3 Rs. Wow. Added together, these cars are worth roughly. Yep, you guessed it, $2.2 million. There's no way for us to know if these cars belong to house, or are part of his salvage business that he runs. Fantastic. [00:35:00] Yeah, but.

Greg Kyte: That it's nice when the numbers tie out like that. Yeah.

Caleb Newquist: It's really, you know, as as accountants, former accountants. Yes. I'm a former accountant, but you are a current accountant.

Greg Kyte: Very, very.

Caleb Newquist: Satisfying. It's very satisfying when the numbers just. Yeah. Work how they should. Anyway, in 2014, House was charged and pleaded guilty to wire fraud in December 2015. He was sentenced to one year and one day in federal prison. There you have it. That is the case. Greg Kite of the Soggy Bugatti. [00:35:30]

Greg Kyte: Dateline Tampa, Florida, 2001. Uh, Caleb. Uh, I probably have never mentioned this to you before, but my son's favorite restaurant, and I am not making this up is Little Caesars Pizza. Oh, yeah. I like I and he's and he's not he's not eight. He's 20. So.

Caleb Newquist: Well Look, look, bad pizza [00:36:00] is better than no pizza at all.

Greg Kyte: Well, and that's the thing, he loves it. And he would never call it bad pizza. Okay, my son is a certified cheap date. Uh, and because of my son's affinity, long standing affinity for Little Caesars Pizza, I have spent far too much time at various Little Caesars locations waiting for my pizza to be put into the pizza portal machine that's in those, if you know, you know, uh, and one thing that I have become totally convinced [00:36:30] of is that Little Caesars employees are unsung heroes. Like they're amazing. Sure, none of them have any social skills or any customer service skills, but they also somehow crank out 100,000 pizzas per employee per shift, which by any standards is fucking amazing.

Caleb Newquist: Amazing.

Greg Kyte: They don't have time to make sure your experience was satisfactory, or to pay attention to food safety regulations. [00:37:00] For real. I had a friend who had a friend who was a health inspector, and that health inspector's one blanket rule was never, never eat at Little Caesars Pizza. So one night in 2001, it was a Sunday at around 3:00 am in Tampa, Florida, a manager from a Little Caesars franchise swung by a Bank of America branch to make his routine night deposit. He's done it a million times, but [00:37:30] this time there happened to be a note saying that the bank's night deposit drawer was out of service and that customers should use the alternate box provided. So this manager, this Little Caesars manager, pulled forward to see this janky ass alternate night deposit box. The alternate night deposit box was so janky. Not only did he not put his deposit into the alternate box, he also called the Tampa Police Department to let [00:38:00] them know about this questionable box. And let me remind you, this is a Little Caesars employee who had just spent hours serving thousands of hot and ready pizzas. So his, uh, his his attention to detail, I would say would be questionable during regular business hours.

Caleb Newquist: Sure.

Greg Kyte: But this was almost 4 a.m., 3:00.

Caleb Newquist: In the morning.

Greg Kyte: And so his even to his tired, overworked eyes, he was able to immediately [00:38:30] spot how janky and asked this alternate box was.

Caleb Newquist: I'm picturing. I'm picturing like a big piece of cardboard with with an arrow. Like with a Sharpie, right? An arrow drawn. An arrow drawn in Sharpie. Right. Like. And it was. And it just says like this one.

Greg Kyte: Right? Right. Just like a, like a, like a, like a dishwasher box that someone just cut, cut a slot out of, like, with a kitchen knife. Yeah. And. [00:39:00] Yeah. And Sharpie. Yeah. You're, um. No, it wasn't that, uh, when, uh, when the police officers arrived, they discovered that the alternate box was actually a mailbox for overnight parcels that apparently A had been unbolted and removed from wherever it was supposed to be and be had been stripped of all of the stickers and markings that identified it as a mailbox for overnight parcels.

Caleb Newquist: That sounds like a real hassle.

Greg Kyte: It does. Like, why.

Caleb Newquist: Would like, have you have you seen those things? Those things [00:39:30] don't move, right? Like to unbolt one and then get all of those decals off of it. Like if it's a Fedex one, how would you even do that?

Greg Kyte: Yeah, well, but but listen to this. Uh, when the police opened it up, they discovered that $35,000 had already been deposited in the fake alternate night deposit box again. Maybe be embarrassed if you got fooled by a thing that didn't fool a Little Caesars employee. I mean, again, no shade to them, [00:40:00] no their heroes. But also. Yeah, we know.

Caleb Newquist: Fourth responders. What? Right.

Greg Kyte: Exactly. So here's what the Tampa Police Department did. They replaced the, uh, the real bags of money in the fake night deposit box with fake bags of fake money in the fake night deposit box.

Caleb Newquist: Okay. Say that.

Greg Kyte: Again. Okay, so they found the $35 of deposits.

Caleb Newquist: 35,000.

Greg Kyte: $35,000 [00:40:30] of deposits in the box. Okay, they took that out. Okay. And they replaced it just with bags of fake money. Okay. And then they set up surveillance. And in my mind, they hid behind some bushes, right? As is what they did and waited. So. So, as I said, Little Caesars guy that was, uh, that was somewhere after 3 a.m. on a Sunday morning at about 7 p.m. that same Sunday, the loot was picked up by a gentleman [00:41:00] named Leroy Clark Jr. Not to be confused with Gary Clark Jr, a guy who only the only thing he picks is a soulful blues guitar.

Caleb Newquist: Yes, that's true.

Greg Kyte: But Leroy Clark Jr, when he came to pick up the loot from his fake alternate night deposit box, uh, he showed up wearing a ski mask because in Florida, lots of people not doing crime wear ski masks. The police followed him to his nearby apartment, [00:41:30] where he was arrested with the fake money, the real ski mask, and a real nine millimeter handgun. Uh, Leroy was charged with grand theft and with carrying a concealed weapon without a permit, possession of a firearm in the commission of a felony, obstructing arrest and escape from police custody. Oh, the last two charges were because after they confronted him at his apartment, he ran away.

Caleb Newquist: Right?

Greg Kyte: As one as a ski masked felon is. [00:42:00] Won't want to.

Caleb Newquist: Do. Yeah. Yeah. Absolutely.

Greg Kyte: Uh, now, Caleb, we've seen lots of fraudsters who create a lot of fakes, fake stuff on this podcast. Sure. Uh, mostly fake invoices and fake contracts. In episode 43, however, we dove into Rudy Kurniawan, who created and bottled fake high end vintage wines. Do you remember that one?

Caleb Newquist: I do remember.

Greg Kyte: Classic. Classic. But regardless, before you pay an invoice or put cash in a night deposit box, make [00:42:30] sure it's legit. Right. Uh, and.

Caleb Newquist: No, no cardboard. No, no cardboard signs written in Sharpie.

Greg Kyte: Right. Which again, I wish it was that. And I wish there was $35,000 of deposit just in a cardboard box outside of a Bank of America. But this is the next best thing.

Caleb Newquist: Yeah, it's pretty good.

Greg Kyte: But. But, Caleb, uh, back to, like, the fake invoices. Have you ever thought about people, fraudsters out there? Yeah. Just send out just kind of blanket. Just one [00:43:00] fake invoice per company that they can find an address to, and they just send it out and just hope somebody will pay for it. And, and and I assume they probably use like a smaller dollar amount. So people just go, oh, I don't know if this is a legit invoice, but it's for $45. Let's just pay it. It costs less money to pay it than it does to verify if it's a real invoice. Right. Yeah.

Caleb Newquist: I mean, it's it's not unlike a lot of the I think we talked about it with, um, Dan Simons and Chris Chabris. Yeah. [00:43:30] Where they said like the, the phishing scams, they, they're, you know, the, the, the numbers of attempts number in the hundreds or thousands, maybe. Yeah. I have to believe that if you send out, I don't know, a few hundred fake invoices you'd maybe get, you'd get some back, right with the payment.

Greg Kyte: And I think the trick is. And then if somebody says, oh, hey, I don't think this invoice is legit, you just apologize and go, oh, sorry. My bad. I meant to send it to somebody else. No harm, no foul. As long as you don't send two [00:44:00] invoices to this, you don't get greedy. And you're like, this guy paid the last invoice. He'll pay the next one. Two. Just keep sending them out to new people. I think you could get away with a lot of fraud for a long time, and never get caught and make quite a bit of money doing it, so fake shit is real. Make sure that you're only paying stuff that's legit.

Caleb Newquist: Okay, Greg, did we learn anything?

Greg Kyte: You know, Caleb, I think [00:44:30] the main thing that we learned is that of all the getaway vehicles available to a criminal, a jet ski is probably near the bottom of the list. Yeah. Uh, we also learned that if you.

Caleb Newquist: Maybe and maybe a Bugatti if you can't drive it. Right?

Greg Kyte: Right, exactly. Well, also.

Caleb Newquist: What good is going 253 miles an hour if you're going to drive it into a fucking swamp?

Greg Kyte: All right, that's it for this episode. Remember, the only thing less probable than winning money at the racetrack is making 291.40 [00:45:00] pounds when someone steals your debit card.

Caleb Newquist: Uh, and also remember, if you're going to wreck your car by driving it into a lake, be sure you're texting when you do it.

Greg Kyte: If you want to drop us a line, uh, send us an email at oh my fraud@earmarked.com. Caleb, where can people find you out there in the internet landscape.

Caleb Newquist: In LinkedIn slash Caleb Nyquist. Greg, are you on [00:45:30] the internet?

Greg Kyte: Uh, rarely. Oh, but I do. I do parachute into LinkedIn about once a quarter nowadays so you can find me on there. I am Greg Kyte, CPA on LinkedIn.

Caleb Newquist: Delightful. Oh My Fraud is written by Greg Kyte and myself. Our producer is Zach Frank. Rate. Review and subscribe to the show wherever you listen to podcasts. If you listen on earmark, you can get some free CPE to nothing. Nothing dumb about that.

Greg Kyte: Nope. And it's time. Don't stop. Stop [00:46:00] procrastinating.

Caleb Newquist: Or keep procrastinating and just listen to all 70 plus episodes in the last two weeks of the year. Whatever. Whatever works for you. Yeah, no judgment.

Greg Kyte: Between Christmas and New Years. Just keep those headphones on and listen at double speed.

Caleb Newquist: Yeah, get a nice pair of headphones for Christmas. Just place them. Right? Right. Yeah, yeah, yeah. Join us next time for more average swindlers and scams from stories that will make you say, oh, my fraud.