The Craziest White-collar Crimes of All Time

White-collar crimes are one of the most interesting crimes to analyze, especially because of the masterminds behind them. Although these people are undoubtedly criminals who deserve to spend their lives behind bars, we do have to recognize that coming up with such intricate schemes is admirable. Some of them even managed to go decades without being noticed and only were caught when they decided to do so. The following article explains four of the greatest white-collar schemes to ever happen, as well as the geniuses behind them. Keep reading to learn more!
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Bernie Madoff

The biggest Ponzi scam in history was carried out by the American banker Bernard Lawrence “Bernie” Madoff, who stole tens of billions of dollars from thousands of people for more than 20 years. He led the NASDAQ at the beginning of the 1990s and was a trailblazer in automated trading. He was given a 150-year sentence for securities fraud, money laundering, and other crimes, leading him to die in prison at 82 on April 14, 2021. Madoff drew in investors by promising to make significant, consistent profits via a popular trading tactic. However, Madoff put his clients’ money into a bank account. Then, he used that money to pay back other investors. When the market drastically declined in late 2008, he could not continue the scam. He tried to keep the scheme up by luring new investors and their funds. However, he admitted his crime to his sons, who were employees at his company, on December 10, 2008. They handed him up to the police the next day.

Bernie made it very clear in his police statement that his boys were unaware of his crimes. According to the fund’s most recent disclosures, he stole around $64.8 billion. The exact start date of Madoff’s Ponzi scheme is unknown. He claimed during the trial that it began in the early 1990s. However, Frank DiPascali, his main broker, who had been with the company since 1975, claimed that it had been going on for as long as he could recall. Why Madoff ever executed the fraud is even more of a mystery. He had too much money, enough to maintain his and his family’s lifestyle. There was really no reason why to do it. Madoff could have gained the admiration of Wall Street’s elites just by being an early adopter of electronic trading and a market maker in the legitimate parts of his business, as they were incredibly lucrative.

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Charles Ponzi

Although not many people outside the banking industry are familiar with Charles Ponzi, most people may infer this information from his last name. A “Ponzi scheme” or “pyramid scheme” is a well-known phrase for an investment fraud in which funds from a steady flow of new participants are used to reimburse previous investors while also benefitting the plan’s creator. Like always, the plan or fraud continues until there are no more potential investors, which makes it collapse. Despite not being the first to use this scheme to gain money, Ponzi is the most popular criminal to use it, which is why it took his last name. Ponzi established the Securities Exchange Co. in 1920, through which he issued shares that promised a 50% interest rate after 90 days. The money the investors gave was meant to purchase IRCs to be delivered in the United States. Instead, Ponzi repaid previous investors using money from new investors. In order to justify his actions, Ponzi cited the Universal Postal Union’s decision to stop the sale of IRCs after becoming aware of his coupon redemption scam. He continued the scam by convincing investors that he had set up a sophisticated network of agents who would get IRCs for him overseas so he could sell them for a bigger profit back home. In reality, he was repaying previous investors with the money from new investments.

The Boston Post published a front-page article about Ponzi in July 1920, estimating his total wealth to be $8.5 million. A little more than a week later, the U.S. Post Office Department published updated conversion rates for foreign postal reply coupons, but they insisted that Ponzi had nothing to do with the adjustment. Investigations into Ponzi continued but didn’t go far until the Boston Post conducted its own search, which caused negative publicity and led Ponzi to lose new potential investors. Moreover, his current investors left his scheme, and Ponzi reportedly paid out more than $1 million.

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Arnaud Mimran

Arnaud Mimran, a French businessman, socialite, and high-stakes poker player, won’t return to the poker table anytime soon. Mirman was given a 13-year prison term in France for planning the 2016 kidnapping of Swiss businessman Yomi Rodrig. The 49-year-old was already serving an eight-year jail sentence after being found guilty in 2016 of running a sophisticated carbon VAT fraud scam. He was then accused of two separate murder allegations, which will add to his already lengthy prison sentence. Mimran was first given an eight-year jail term for his involvement in a sophisticated Carbon VAT scam in 2008–2009. According to The Times of Israel, the scam involves 50 individuals working in small groups of two to three people and taking advantage of various European tax regulations to swap carbon credits and authorizations to emit carbon dioxide. The scheme was called the “Swindle of the Century.” It involves people buying tax credits in a nation without VAT and then selling them in a country with VAT. Businesses in France had 90 days to return VAT, but he managed to transfer the money elsewhere by then. According to estimates from the French government, this led to a loss of €1.6 billion in unpaid VAT taxes, with overall losses across Europe estimated to be between €5 million and €10 million.

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Jordan Belfort

Jordan Belfort had more impact than most people in the banking industry over the perception of Wall Street as a ruthless, cruel place. In 1999, Belfort faced many charges of stock market manipulation and orchestrating a lengthy penny stock scheme. Belfort published two autobiographies following his conviction and incarceration; the first, The Wolf of Wall Street, was made into a 2013 film starring Leonardo DiCaprio and directed by Martin Scorsese. The second one is called Way of the Wolf, a self-help memoir published in 2017. Belfort has faced a terrible backlash for making money off of his crimes while leaving his victims with nothing. After putting behind all the controversy and his time behind bars, he has reinvented himself as a motivational speaker. One of his key topics is the contrast between Wall Street’s greed, ambition, and emotion. The unlawful actions that led to Belfort’s imprisonment happened when he served as Stratton Oakmont’s creator. Stratton Oakmont artificially inflated the price of penny stocks through pump-and-dump techniques, among other scams.

Additionally, the business pushed investors to place their money in hazardous assets. More than 1,000 brokers allegedly worked there, managing more than $1 billion in assets. The National Association of Securities Dealers eventually took Stratton Oakmont to court. Then, the company shut down in 1996. Belfort and his friend Danny Porush were found guilty of securities fraud and money laundering in 1999. He confessed to having created the pump-and-dump scams, costing his investors up to $200 million. Then, he received a four-year prison sentence but only spent 22 months behind bars.

Bottom Line

Many people spend their lives working at jobs they despise. These people decided to find an alternative finance solution. However, they had to pay the price to end up in jail after orchestrating some of the biggest money-related crimes. This doesn’t mean you must become a criminal if you need a credit repair. We can ensure you can take much easier financing options without harming anyone. Still, it is mind-blowing to see how criminal minds think.

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