Articles Posted in White Collar Crime

In 2006, three brothers opened the largest liquor store in the world with a store area of over 100,000 square feet. Now in 2011, after a routine check in 2008, the owners are facing indictment for various white collar crime charges in Colorado, according to The Denver Post.

The 52-count indictment includes charges of racketeering, violating the Colorado Organized Crime Control Act, and tax violations. The brothers allegedly falsified merchandise returns for millions of dollars worth of products that never existed, some of which they even created names for. After some investigation, it was determined that the brothers performed at least 4,400 fake product returns as well as conducted over $5 million of business outside of normal business hours and in cash. Furthermore, the family allegedly violated Colorado liquor laws by running a second store in Highlands Ranch under “hidden ownership.”
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Companies worldwide lost millions of dollars of stolen electronic data last year, according to an article recently released by Reuters. For the first time, the amount lost through stolen electronic data was higher than the amount lost through theft of physical objects.

Most of the electronic fraud was “inside jobs” where company employees stole from the companies they worked for, according to Kroll, Inc., the risk consulting firm that ran the study. Fraud was highest in Chinese corporations, with companies in Colombia and Brazil not far behind. Of the electronic data stolen, cash and company assets were the most popular targets.
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A man from Weld County, Colorado, was recently sentenced to 32 years in prison for an investment scheme and was directed to pay $5 million to the investors he defrauded, according to an article from The Tribune.

The man was indicted in 2009 on charges that he accepted more than $10 million from investors in three Colorado counties and residents in 15 other states as part of a Ponzi (also known as a pyramid) scheme. A Colorado ponzi scheme brings in investors and pays the original investors with money obtained from later investors. It typically fails because it runs out of new investors. Investors in this man’s scheme lost between $50,000 and $1 million each.

Apparently, the convicted man started his scheme in June 2005. He kept most of the money he received, although he lost $1.5 million to gambling. He told investors he was investing in an electronics business. Prosecutors say he lied about an agreement with an electronics distributor, potential returns and the risk involved. A man from Massachusetts was also arrested in the case. He acted as a representative of the company and helped to locate investors. He pleaded guilty to securities fraud and was sentenced to four years of probation and was ordered to return the funds.
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According to an article by the Denver Post, a man from Colorado Springs was accused of attempting to destroy Transportation Security Administration (TSA) computers that allow airport security to locate possible terrorists prior to boarding an aircraft.

The man allegedly loaded a virus into the system’s database at the TSA’s Colorado Springs Operations Center, which is linked to the Terrorist Screening Database and the U.S. Marshal’s service Warrant Information Network. The virus was designed to infiltrate the system on a specific date with the intention of corrupting information and destroying the database completely. Fortunately, TSA technicians tracked the virus and were able to contain it before any damage was done.
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According to the Denver Business Journal, a Nigerian national has been deemed the ringleader in a multimillion-dollar mortgage fraud scheme. The 45-year-old was sentenced to 30 years in prison for the scheme, and will be deported back to Nigeria once his prison sentence is completed. The man was convicted on a total of four felony counts, and, along with nine others, was deemed responsible for, according to Attorney General John Suthers, “one of the most expansive and heinous mortgage fraud rings [ever] seen in Colorado.”

Charges involved in this case ranged from forgery to theft and computer crime. A total of 34 real estate deals were connected to these crimes with false invoices, the establishment of shell corporations, and a host of inaccurate information being exchanged with mortgage lenders (in order to acquire larger mortgages) all being utilized in the deception. These infractions, while not violent, are still criminal acts, and are often labeled as white-collar crimes. Typically, the theft or unlawful obtaining of information is deemed as a white-collar infraction, and such charges can be just as harsh as those associated with violent crimes. Particularly since white-collar crimes tend to be committed in tandem with one another, linking multiple charges together can result in harsher, compounded sentences.
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