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View Full Version : I need a business scam, please



MarkEsq
04-18-2007, 05:54 AM
So here's the set-up: two guys are in business together. Preferably some tech thing or other. That internet thing, you know. It's doing well, very well.
Or is it?
You see, one of the two has been skimming money somehow, some way. He's about to get busted so he fakes his partner's suicide. My MC, of course, figures it out and busts him.

So here's my question: how would the skimmer be skimming? What exactly would he be doing to be able to line his pockets and give the appearance of a successful business? I have never been in business and have no idea about accounting practices. Can anyone suggest a simple-to-explain scam he might be running?
Thanks for any and all help!

poetinahat
04-18-2007, 06:39 AM
Surrrrrre. This is for your novel. *wink, wink* Just remember us here on that charter flight to Argentina!

Maybe a little reading on some well-known scams? Enron might be a little too large-scale, ZZZZBest might be a little low-tech, but still worth a try.

Others here might suggest, oh, certain "publishing houses" or shonky agents.

Tech-wise? Maybe a high-tech cross between The Producers and Paper Moon? Come up with some sort of sweet-sounding business model around vaporware or fake research, raise a lot of venture capital (maybe through struggling new VC firms or playing on the emotions of widows -- there's scope there), and oversubscribe the business?

Just some thoughts.

DeadlyAccurate
04-18-2007, 07:55 AM
Cooking the books is an easy way to embezzle money. I have no idea how to do it, however. It took me three times just to pass Accounting I in college.

The fake venture capital that poetinahat mentioned would work, too.

Wiki (http://en.wikipedia.org/wiki/Embezzle)article on embezzlement.


One of the most common methods of embezzlement is to under-report income, and pocket the difference. For example, in 2005, several managers of the service provider Aramark were found to be underreporting profits from a string of vending machine locations in the eastern United States. While the amount stolen from each machine was relatively small, the total amount taken from many machines over a length of time was very large.

Another method is to create a false vendor account, and to supply false bills to the company being embezzled so that the checks that are cut appear completely legitimate. Yet another method is to create phantom employees, who are then paid with payroll checks.

BiggerBoat
04-18-2007, 10:08 AM
Maybe this is a company has a technology that is all the buzz, and they are about to go public (sell shares on the stock exchange). Analysts say that the stock is going to go crazy. The founders stand to make millions.

Only the technology simply doesn't work. There's something fundamentally wrong with it. The betas haven't gone well. For now, they're faking it. But in a matter of months, maybe even weeks, they won't be able to keep it secret anymore. Guy #1 doesn't want to face the eventual legal ramifications once they get found out. If it seems like things are coming to that point, Guy #2 is content to sell of his shares, take the money and run.

Guy #2 kills guy #1 to keep things under wrap until after they go public.

Inkdaub
04-18-2007, 10:13 AM
http://www.fbi.gov/whitecollarcrime.htm

cletus
04-18-2007, 01:03 PM
I recently read Derailed by James Siegel. There were a couple of employees in the book that were defrauding the advertising company they worked for by putting charges in for a music company that didn't exist and using stock music.
You could turn this around and have the one partner authorising payments to a software development company that doesn't exist while using some form of openly available freeware.

rhymegirl
04-18-2007, 05:12 PM
All I can think of is that movie Ghost.

One guy uses his friend's little code book to access certain accounts on the computer and moves money from one account to another and gets money from the bad guys for helping them.

MarkEsq
04-18-2007, 06:27 PM
Thanks so much guys, some great suggestions. You'd think being a former prosecutor I'd have some ideas but I just dealt with the blue-collar stuff mostly.
Thanks again folks!

Joe270
04-19-2007, 03:53 AM
Hello, Mark.

I lived in Austin way back. I went to the police department for cop details for a script. The desk sargent sent me to a detective who was very helpful.

As a former prosecutor, I doubt you'd wind up in a line-up.

jonereb
04-19-2007, 05:30 AM
This may not help but your post made me think about a trial going on in Memphis, TN. A state senator allegedly took bribes from a phony company call E-Cycle. The fake company claimed to recycle used computer equipment and were trying to get state government contracts. Actually it was a sting operation. It don't look good for the state senator.

Anthony Ravenscroft
04-19-2007, 07:50 AM
Look, I know it sucks, but this is basic research. You can't simply grab a handful from the Gimmick Grab-Bag & glue one into your plot.

For instance:

When calculating percentage-based stuff like taxes or discounts or shareholder valuation, there's a roundoff error of fractional cents. This is almost nothing. However, take a tenth of a cent & multiply it by a million operations a day, such as seen by PayPal or something. Dump the fractions into a cumulator stack or something, then piggyback it to the company's daily transfer to their account in Liberia or the Caymans or whatever.

But unless you've done your homework, you won't have a clue that this has been going on since at least the 1960s -- assuming it even exists at all, it's going to be so mutated as to be barely recognisable.

And most of your readers will likely know it & feel like you're a third-rate BSer at best.

I think you need to write a story that doesn't depend so much on a black-box gimmick you don't yourself understand.

Joe270
04-19-2007, 11:02 AM
Anthony's senario above was used in "Office Space" (I might have that wrong, I suck with names and titles)

Seems every week on the news there's something about the Nigerian scam.

Try a variant of that.

ErylRavenwell
04-19-2007, 02:57 PM
Look, I know it sucks, but this is basic research. You can't simply grab a handful from the Gimmick Grab-Bag & glue one into your plot.

For instance:

When calculating percentage-based stuff like taxes or discounts or shareholder valuation, there's a roundoff error of fractional cents. This is almost nothing. However, take a tenth of a cent & multiply it by a million operations a day, such as seen by PayPal or something. Dump the fractions into a cumulator stack or something, then piggyback it to the company's daily transfer to their account in Liberia or the Caymans or whatever.

But unless you've done your homework, you won't have a clue that this has been going on since at least the 1960s -- assuming it even exists at all, it's going to be so mutated as to be barely recognisable.

And most of your readers will likely know it & feel like you're a third-rate BSer at best.

I think you need to write a story that doesn't depend so much on a black-box gimmick you don't yourself understand.

Honestly, Ravenscroft, this is such a tired scenario. But the fractional cent thing is brilliant though.

JustinThorne
04-19-2007, 03:17 PM
Money Laundering.

The guy could have been paying in proceeds of crime on behalf of criminals, taking a cut, through the business' bank accounts. He would then wire clean money to the back account of the criminals' choice.

Perhaps his partner noticed that the accounts were turning over sums of money over and above a reasonable cashflow for a start-up tech business.

johnrobison
04-19-2007, 03:43 PM
Here are some real scenarios.

A car dealer and a guy in the rackets who wants to move/launder some money. So the guy in the rackets sends someone to the dealership with $100k to buy a new BMW. But he never takes delivery. Two months later, he calls the dealer and says, "OK, I'm selling it back to you. Pay xxxxx $80k.

Car dealer made 20k on the deal for nothing. Guy in the rackets paid $80k to some other crook in a way that's not traceable to him, at least not easily.

* * *

OK, here's another.

Guy is VP of Manufacturing operations for a decent sized company. He sets up a coprporation, called ACME cleaning services. He starts writing bills for ACME doing maintenance work around the plant. The company spends 1 million plus on maintenance, so the $500-800 weekly bills go un-noticed.

Works fine for years, until some sharp auditor says, "Who are they? I've never seen them here? I want to see them."

* * *

And an old standby.

Whiskey and water is supposed to cost $3. The bartender charges $4, and slips one in his pocket.

JustinThorne
04-19-2007, 05:21 PM
Yea using John's scenario... your crooked partner is taking vast orders for the tech product, but the crooks keep pulling out and cancelling their orders after already paying for it. He then wires 90% of the proceeds back to the crooks, but wires his 10% commission to his own bank account.

The other partner would see regular sums going through the company's accounts, but it never stays for long, so he gets suspicious... and then dead.

MarkEsq
04-19-2007, 06:54 PM
Look, I know it sucks, but this is basic research. You can't simply grab a handful from the Gimmick Grab-Bag & glue one into your plot.

I think you need to write a story that doesn't depend so much on a black-box gimmick you don't yourself understand.


Maybe I just misread your tone, Anthony but I asked for suggestions so I could consider, understand, and apply them if they work for my story. I didn't plan on cutting and pasting someone's post and hanging my story on it. Character development, factual questions, even grammatical issues could all come under the rubric of 'basic research' and I consider this forum one of my first stops. So, if you intended the patronizing tone, I don't appreciate it. If you didn't and I misread your tone (quite possible) then ignore me. :)
And thanks to all of you who have displayed your inner embezzlers for my education.

OmenSpirits.com
05-04-2007, 08:41 AM
POD or vanities seem to do good biz even when everyone knows that some are shams.

I'd use one of those. Or a pyramid scheme.

dub
05-08-2007, 02:55 PM
This is stupid, but crooks do some stupid stuff. For a few years we owned a little pizza place, we caught a waitress doing a double switch with receipts. She would write two tickets, the customer would pay (at the table) the one delivered, she would substitute the dup and pocket the difference. Since we were 90% cash at the time it was easy. She bragged to another waitress what she was doing...stupid. We fired her and now she is working for the city manager's office, and I bet part of my tax dollars are going into her account.

DeadlyAccurate
05-10-2007, 02:14 AM
That reminds me of coupon dropping, which the drivers at the pizza place I worked at would do regularly. The customer would order something that often had a coupon associated with it, like a medium pepperoni, and pay full price. The driver, when turning the money in to the person at the register, would add a coupon he kept in his car and pocket the difference.

dub
05-10-2007, 03:00 AM
For years, Bartenders have switched second class liquor into high class bottles. The trick is to start the customer on the good stuff, then substitute the rot gut. Then pocket all the money from the rot gut and the good stuff always measured out right.

Gable
05-30-2007, 06:36 AM
I'm late to the game but I'm a newbie so just saw this post!

If these business partners have a tech company that is doing well, presumably they'd be doing things like acquiring other companies, raising debt and equity financing, etc. For all these things they'd need the use of an investment banker. Investment bankers get paid fees... think 1% of total deal size. So if this company makes a $500mm acquisition, they'd get a $5 million fee. For raising debt the fee is even higher 2-3%.

So you could have it that they have hired investment banks to do all these financings (they are usually on retainer, too) and the shady character could have some sort of ownership in the bank or be getting a kickback of some sort. Getting a kickback is the more likely scenario as it would probably we well known if he had an ownership interest.

If you want just straight out accounting irregularities he could be capitalizing things when they should be expenses therefore overstating earnings.

DJTorrance
05-30-2007, 06:19 PM
Scam your investors - take their money and fold up and run - like the two men did in the movie based on the play which was based on a movie - The Producers.

Hillarous and devious.

Lindo
05-31-2007, 04:49 AM
That's a variation of a bustout...but stuff on credit (or your partner's accounts) blow it out cheap, fold up and split.

I hate to tell you, but you're going to have to really work on getting a scam if you're going to hang a book on it. I'd look around to the real experts, not writers (what the hell do writers know about money? :-)
I once read a book called "The Big Con", a rundown on confidence games using "stores" or fake business locations. A few years later The Sting came out and I was gassed. I was going, "I know what book you read, dude". Even some of the tiny details in the book, like using a "cackle bladder" full or chicken blood in the mouth to simulate bleeding and "lighting a rag under" the mark to get rid of him were used in the movie.
So if you find a book like that, you're in business. I don't think it would be hard to find. Have you read any of Robert Ringer's machiavellian business practice books?

Gable
05-31-2007, 09:03 AM
I'd look around to the real experts, not writers (what the hell do writers know about money? :-)

Well some writers know about business. :D I have worked in finance for over a decade and Enron was one of my clients!

ShapeSphere
05-31-2007, 05:46 PM
This article The Top 25 Web Hoaxes (http://www.pcworld.com/article/id,131340/article.html) from PC World may give you some ideas and it is all technical. I just read it today funnily enough. Although the article is from 3 May.

Lindo
05-31-2007, 07:31 PM
Enron was one of my clients!

Now THERE'S a brag you seldom see!;)

Gable
06-01-2007, 03:51 AM
Now THERE'S a brag you seldom see!;)

Post-bankruptcy. We helped them reorganize and clean up their mess. ;)

dclary
06-01-2007, 04:33 AM
So here's the set-up: two guys are in business together. Preferably some tech thing or other. That internet thing, you know. It's doing well, very well.
Or is it?
You see, one of the two has been skimming money somehow, some way. He's about to get busted so he fakes his partner's suicide. My MC, of course, figures it out and busts him.

So here's my question: how would the skimmer be skimming? What exactly would he be doing to be able to line his pockets and give the appearance of a successful business? I have never been in business and have no idea about accounting practices. Can anyone suggest a simple-to-explain scam he might be running?
Thanks for any and all help!


Here's a true-to-life one.

Secretary for a company takes the daily receipts every day to the bank, and deposits 90% of them (keeping whatever cash should have been deposited herself and only depositing checks/etc). Enters 100% of the receipts into the accounting software. Everything checks out right on the accounting software. No one knows any different unless they're looking at what the bank statement says against what the accounting statement says. In most small companies, you're way to busy to worry about that until someone notices something's wrong.


bank account to automatically ACH money into his own account