avoid prison, fraudFive Simple Steps to go to Prison

In 1994 I was approached by some real estate investors and became involved in their real estate fraud conspiracy.  I wasn’t innocent, but I was naïve.  I broke off my association with them after a few months for fear of loosing my job. I wanted to avoid prison, but it didn’t work out that way.

At the end of 1998, four years after my association with the real estate investors, I was arrested by the FBI outside of a restaurant and charged with conspiracy to commit mail fraud, wire fraud and money laundering.  I fought the charges because I didn’t want to admit I did anything wrong but I eventually plead guilty and received a 21 month federal prison sentence.

I have taken some time, to pull from my experience, 5 action steps you can take to guarantee that your career and your life will change forever.

 

1. Subscribe to “Business As Usual” attitudes

In all industries, there are procedures and practices that would be considered “cutting corners.”  Perhaps at one company or with one client this corner cutting isn’t done or expected but at another company or with another client it is.  Refusing to cut corners can be exceedingly difficult when you are trying to keep your job or retain your customers and referral sources.  I know your mother told you that one white lie can lead to another bigger white lie then another and another – before you know it you’re a big fat liar pants and are in way over your head.

Action:  Don’t listen to your mother, go with the flow and cut corners.

 

2. Don’t just turn a blind eye – help out!

As it turns out, most fraud occurs with collaboration, collusion or knowledge from someone on the inside.  That is to say that for the most part, the accountant, attorney, co-worker, sercetary, assistant or HR professional – at least one of these people knows of or is outright helping the person with the master plan.  (In the real estate industry, it could be, the loan officer, appraiser, closer, account executive or real estate agent.)  If you’re a licensed professional it is unlikely (but not impossible) that you are being completely duped by someone at your own game.  At the very least, you have a gut feeling.

Action:  Make a conscious decision to ignore your gut feeling and assume that your instinct is telling you to do the wrong thing first.

 

3. Trust everyone

In the above step, I state that most fraud doesn’t happen in a vacuum.  This step, number 3, is an exception.  This step involves con-men.  Confidence men as they were originally called can be very good.  They construct a facade—a persona of sincerity and honesty that for most part will not be transparent.  They will become your friend and they will use every resource available to get you to do what they want; which is assisting them in perpetrating a scam.  Again, this is an exception to the above in that you will be beat at your own game.

Action: Trust everyone.

 

4. Justify your unethical actions

My involvement in the scam that ultimately led to my indictment in a fraud conspiracy included the justification of many things.  For instance, I told myself that since I was not explicitly told, by the king-pin, that the documents I received were fakes, that it was not my job to act on my suspicions and check them out.  I told myself, “I didn’t create any fake documents, they did.”  I also told myself that even if I knew that the documents were fakes, it wouldn’t really hurt anyone – after all, the straw buyers did have good credit.

Action:  Lie to yourself until you feel okay about it.

 

5. Subscribe to the belief that if a money tree falls in the forest and no one is around, you can take all the money

This might seem like a no-brainer but you’d be surprised.  Being a felon and all, I’ve rubbed elbows with some unsavory sorts.  I’d say that at least half of them actually committed “opportunistic” fraud or fraud justified by what they perceived as need.  They’d known for some time of a weakness in the guidelines or a loop-hole in their professional practice.  They never exploited it because by doing so, well, that would be just wrong.  For weeks, months or years the loop-hole just sat there; quietly.  Then one day, BAM the sick aunt broke a hip, no health insurance and the money was then taken – through the loop hole!  There was an opportunity and a need and no one would ever know.

Action:  Take the money.  If no one is looking, it’s yours!

 

Some may feel that the above actions can be placed in categories ranging from big to small, severe to not so severe. Perhaps some of the actions above appear to be simply cutting corners or “gray area” activities.

 

Know this; every corner you cut trims a little piece from your soul.  I know from experience that it is almost impossible to get that back.  There is no gray area; there is a thin black line.  You are either on one side of it or the other.

If you think otherwise, follow steps 1 through 5 and write to me from the inside – pencil and paper.  Depending on which prison you go to, I might know a few guys who can get you an extra dessert in the chow hall.

By the way, on of my favorite shows is Prison Break.  Hmmm, I wonder why?

 

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Jerome Mayne is the author of the book, Diary of a White Collar Criminal which is about how he went to federal prison for conspiracy to commit white collar crime, and co-author of the real estate continuing education course, Mortgage Fraud and Predatory Lending – what every agent should know (Dearborn/Kaplan)He is a keynote speaker on fraud and ethics and has worked with dozens of companies and associations helping their people make the right decisions, when the right decisions aren’t easy.