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AMERICAN EXPRESS CARDS USED TO PERPETUATE FRAUD IN SUN VALLEY

The client, Mr. E., is a wealthy business man who owns a couple of ranches, a home in Los Angeles, and one in Las Vegas; but he prefers to spend as much time as possible at his home in Sun Valley where his two daughters and their families live.

In an effort to help one of his daughters, who was an alcoholic, he decided to build a very nice retail shop in Ketchum, the town nearest to Sun Valley where she and her mother, Mrs. E., could set up an exclusive gift shop. The thought was that the mother and daughter could bond while traveling Europe buying antiques and other very nice items to sell in the shop. This turned out to be a success when the high-end exclusive shop became a favorite of many movie stars and other wealthy people. I recall seeing a set of napkin rings; each individual ring was priced at $1,250.00. A lot of money came through that little shop.

A little over a year after the shop opened I received a call from Mr. E. requesting that I meet him at his home office in Sun Valley as soon as possible. He requested that i bring one of my senior forensic accountants with me.

Upon arriving, we learned the following: it seems the daughter and wife enjoyed very much very much their buying trips to Europe , but had little or no interest in running the shop day-to-day. Therefore, Mrs. E. had hired her hairdresser to run the shop and keep the books. Mrs. E. had known her for several years and felt no need to get a resume or check her background. The new manager hired two local young ladies to work in the store keeping the inventory displayed nicely and giving the customers excellent personal service. They also had one part-time employee who worked the stock room and did most of the actual bookkeeping.

This part-time girl found an American Express invoice hidden behind the sink under the counter in the break room where they kept the coffee pot. Concerned with this unusual finding and suspicious that something was probably wrong, she went to the home of Mr. and Mrs. E. after work that day to share her finding with Mrs. E., as Mr. E. was out of town. The next day, Mrs. E. confronted her friend and former hairdresser, the manager. It was not a pleasant meeting. The manager was irate that anyone would even questionn her as if she had done something wrong. The meeting ended with Mrs. E. leaving in tears and quite upset. Thus, we were called in by Mr. E. to get to the bottom of the situation.

With that little bit of background, my forensic accountant and I met with the staff. While the accountant reviewed the books, I began interviewing the two sales ladies and the part-time employee who had found the American Express invoice. I interviewed each of them separately then met with the local Police Chief to explain what we were doing and to set up a meeting with the District Attorney for later in the week. I received assurances of cooperation from both.

Over the next few days we learned the following. Things get boring during the slow season. The manager decided to redecorate her home – with merchandise from the store – it was obvious to her that the owners didn’t care because they were never there. The two sales girls saw what was going on and wanted in on the action. Apparently, to keep them quiet and to share in the spoils, the manager agreed. It became a feeding frenzy. I could only think of the rushed excitement of the gold fish when it’s time for the daily feeding.

The three of them ran into logistical problems since some of the items they “needed” at home were too large to fit in their cars and no one had a pickup. But not to worry – manager to the rescue. Mr. E. had told the manager that since his two friends had sold their local bank to a big bank chain, he wanted her to open the business account at his friend’s new bank down the street. He thought she understood that she was to close the old account. She did as she was directed and opened the new account, but deposits were going into both banks, at her discretion.

To solve the problem of getting merchandise to their homes the manager opened an American Express Business Account and got cards for each of the three of them. They could now do online shopping and have the merchandise delivered to their homes and the invoice paid with checks drawn on the original bank account.

The three ladies were all friends, especially the two sales people. One of them got scared and started recording their conversations, especially after we got to town. During her second interview she broke down and made a complete written confession and went home to get her recordings and gave them to me. She talked to her friend, told her of her confession, and the second lady then determined that she would be allowed to give me her written version of what happened. I granted her demand and took her confession.

With this information and the documentation to collaborate it all with the findings of my forensic accountant, it was rather easy to get the written confession of the manager, especially after we found she had paid for her daughter’s wedding and airline tickets for a family guest – all on the company American Express card. They each took us and the police to their homes to surrender the stolen merchandise. Their unhappy husbands each got to load it all up and return it to the store.

We worked with the local police and the District Attorney and each of the three were convicted and received six months in the county jail and full restitution for everything they had stolen that could not be returned, like airline tickets, the cost of the wedding, etc.

I am happy to report the shop reopened under new, highly-qualified professional management with a professional sales staff using an excellent CPA and auditor. Mr. and Mrs. E. are very happy clients.

Copyright all rights reserved. Financial Forensic Services, LLC 2020 Brief quotation with attribution permitted. 

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“As an environmental law firm, we use Joe Dickerson to locate prior business owners and do corporate genealogies. He is persistent, that’s the key to a good investigator, and he has a knack for understanding how people move money and do business. That tells him what rocks to look under. Joe is vastly superior to other investigators in two ways: he lets you know what’s going on and he’s honest with you, because he tells you if there’s really anything there worth pursuing. He is unusually thorough and creative finding people. Joe has earned his fee every time.” “If the information is to be found, then I believe that they will find it. Their service enabled me to do a much better job for my client.”

Tim Gabelhouse
, Attorney at Law

2014-11-11T18:20:41+00:00

Tim Gabelhouse
, Attorney at Law

“As an environmental law firm, we use Joe Dickerson to locate prior business owners and do corporate genealogies. He is persistent, that’s the key to a good investigator, and he has a knack for understanding how people move money and do business. That tells him what rocks to look under. Joe is vastly superior to other investigators in two ways: he lets you know what’s going on and he’s honest with you, because he tells you if there’s really anything there worth pursuing. He is unusually thorough and creative finding people. Joe has earned his fee every time.” “If the information is to be found, then I believe that they will find it. Their service enabled me to do a much better job for my client.”

“They went overboard in providing excellent service. I was very pleased with what they provided for me as their end product. Financial Forensic Services really understands how a case needs to be put together in order to be presented to a jury. Their PowerPoint presentation tied everything together. It was thorough, it was concise, and it got the job done.”

Jim Thomas
, Prosecuting Attorney

2014-11-11T18:21:32+00:00

Jim Thomas
, Prosecuting Attorney

“They went overboard in providing excellent service. I was very pleased with what they provided for me as their end product. Financial Forensic Services really understands how a case needs to be put together in order to be presented to a jury. Their PowerPoint presentation tied everything together. It was thorough, it was concise, and it got the job done.”

” I was prepared to dismiss a federal case involving millions of dollars against a local individual who claimed to have no substantial assets. After your staff hit the records and delved into the transactions behind the transactions, you discovered the individual to actually be worth a few million dollars. We continued the case to conclusion. We were also very happy with the financial background examinations you conducted of the former directors of two failed national banks. The heart of any civil case is whether there is a pot at the end of the lawsuit. You were our lucky leprechaun in finding such pots.”

R. Michael Sentel
, Former Section Chief Legal Division, FDIC

2014-11-11T18:13:08+00:00

R. Michael Sentel
, Former Section Chief Legal Division, FDIC

” I was prepared to dismiss a federal case involving millions of dollars against a local individual who claimed to have no substantial assets. After your staff hit the records and delved into the transactions behind the transactions, you discovered the individual to actually be worth a few million dollars. We continued the case to conclusion. We were also very happy with the financial background examinations you conducted of the former directors of two failed national banks. The heart of any civil case is whether there is a pot at the end of the lawsuit. You were our lucky leprechaun in finding such pots.”

“When I was general counsel for First Interstate Bank, I used Joe Dickerson for locating assets, investigating behavior and asset discovery. He did excellent work and always got the information I needed without compromising the bank in any way. He’s more thorough and kept in better touch with me than other investigators. I’d give him a grade of 96 or 97 out of 100.”

Frank Brainerd, Retired
Banker/Attorney

2014-11-11T18:20:20+00:00

Frank Brainerd, Retired
Banker/Attorney

“When I was general counsel for First Interstate Bank, I used Joe Dickerson for locating assets, investigating behavior and asset discovery. He did excellent work and always got the information I needed without compromising the bank in any way. He’s more thorough and kept in better touch with me than other investigators. I’d give him a grade of 96 or 97 out of 100.”

“Joe is the most competent investigator I’ve ever found. He has rare ability to find hidden assets. Others claim it, Joe has it. He understands the Rules of Evidence, he knows how to talk to people to develop a fact pattern, and he has a sixth sense for fraud. Joe has unquestioned integrity and delivers value for his services.”

Andrew Quiat
, Attorney

2014-11-11T18:12:51+00:00

Andrew Quiat
, Attorney

“Joe is the most competent investigator I’ve ever found. He has rare ability to find hidden assets. Others claim it, Joe has it. He understands the Rules of Evidence, he knows how to talk to people to develop a fact pattern, and he has a sixth sense for fraud. Joe has unquestioned integrity and delivers value for his services.”

“Joe Dickerson is the industry standard. You can measure the rest by what he does, and I say that without equivocation. Joe has incredible insight into the dark world of fraud. He understands the devious ways in which people perpetrate white-collar crime.”

Jan Schlichtman
, Attorney at Law

2014-11-11T18:20:55+00:00

Jan Schlichtman
, Attorney at Law

“Joe Dickerson is the industry standard. You can measure the rest by what he does, and I say that without equivocation. Joe has incredible insight into the dark world of fraud. He understands the devious ways in which people perpetrate white-collar crime.”

“Joe spends the time to understand the problem from the client’s perspective and from the legal perspective. He is intelligent, tenacious, willing to work as hard as it takes, thorough, well-informed, and just awfully good at what he does.”

Thomas E. Root, 
Attorney

2014-11-11T18:20:05+00:00

Thomas E. Root, 
Attorney

“Joe spends the time to understand the problem from the client’s perspective and from the legal perspective. He is intelligent, tenacious, willing to work as hard as it takes, thorough, well-informed, and just awfully good at what he does.”

“Financial Forensic Services did an excellent job in the way they executed my case. They were very straightforward. They stated what they could do for us and they did it. And, from a personal standpoint, they are excellent. Both my wife and I felt very comfortable working with them.”

Michael Whalen, 
Businessman

2014-11-11T18:21:13+00:00

Michael Whalen, 
Businessman

“Financial Forensic Services did an excellent job in the way they executed my case. They were very straightforward. They stated what they could do for us and they did it. And, from a personal standpoint, they are excellent. Both my wife and I felt very comfortable working with them.”