Executive Fraud Blog

[A]ccording to etiolated.org, a consumer-advocacy group, only 21 percent of "data-loss" cases in our nation since 2000 have come from the federal and state government, with 40 percent traced to private businesses and 39 percent from educational, medical and nonprofit sources.

"The consumer magazine Which? warns that people are effectively giving away PIN codes and passwords by posting just a handful of personal details on the sites, including their date of birth, contact details and home address."

Thats a pretty good point that I'm sure many people often overlook. It is important to keep a unique and random password to your important accounts in order to protect yourself from identity theft fraud.

Many of you may have been exposed to the original online stock scheme where spammers will send out stock picks on penny stocks creating buzz that artificially drives up the price of these worthless stocks. As the price hits the daily high the spammers liquidate their own holdings and walk away with the profits leaving those buyers with the worthless stock. This old fraud scheme has been manipulated and redirected at users of public computers specifically hotel users.

Online criminals have developed software that will track the key strokes of these computers especially when these guests are checking out their online portfolio accounts. By stealing their accounting identity the fraudsters are able to buy large holdings in these penny stocks to drive up the price then they are able to liquidate their position while leaving the stolen account stuck in the those stocks. Companies such as E*Trade and TD Ameritrade have been left with the liability to reimburse investors nearly $20 billion in one quarter. This type of securities fraud is becoming more common with the amount of users of online trading companies tips 30 million. The best way to prevent this from happening to you is to make sure that you have a secure connection to the internet and ensure that you do not have malware on your computer by running virus scans and anti-adware software.

The Former CEO with DreamLife Financial was ordered to repay $6.7 million to lenders and clients that had been defrauded. Beyond repayment, Tony Daniloo has been sentenced to 7 1/2 years in prison for 122 counts of fraud and money laundering. The most disappointing part of this scandal is that Tony used the identities of his family members in order to hide the fraud.

Michael A. Daly of Danvers, Mass. has recently been arrested for using false identities to fradulently receive replacement computer networking equipment from Cisco Systems. Between the 700 instances of fraud in 39 states and federal wire fraud charges, Daly is facing a maximum of 20 years in prison and up to a $250,000 fine.

This technology fraud was perpetrated by using Cisco's SMARTnet program that allows customers to received replacement parts prior to returning the broken ones. The listing price of these parts ranged from $995-25,000 and total damages from the fraud are estimated to be in the millions.

The unfortunate ends to these fraud schemes are higher prices for consumers and the possibility of ending programs such as SMARTnet for smaller companies. This can result in longer system downtime and overall costs for business operations.