White Collar Conspiracy
Many of us have a misconception; an image in our minds of what a white collar conspiracy is. This usually comes from news media or movies and often we use this as a gauge as to whether or not we are committing a crime. This can be a dangerous mistake in the real world of corporate America.
White Collar Conspiracy Scenario A
Somewhere on the outskirts of Atlantic City, New Jersey
It is 1:36 a.m. and a silent, stealth helicopter lands behind a warehouse. Rafael exits the aircraft toting a dark blue metal attaché case. He taps two quick knocks on the door, waits, then two more. A voice from behind the door says, “The eagle flies at midnight.” Rafael responds, “Vienna pancakes.” — the coded response.
The door opens. Francisco gives his partner Rafael a nod. He turns, withdraws a penlight and gives three short flashes to the chopper pilot who takes off. They close the door and descend the metal staircase where a half dozen computer monitors partner with the musty smells.
Rafael sets his case atop a waist high, wooden crate. From his shoe he produces a tiny silver key, inserts it into the lock. Francisco does the same and they both turn their keys at the same time. The case pops open to reveal a clear plastic flash drive embedded in a block of foam padding.
Rafael withdraws the memory device and hands it to his partner. Francisco inserts it in into his computer for just a moment, then hands it back. In low tones he says, “With these codes you’ll be able to divert all wire transfers coming into the escrow company. The funds will be deposited into the Belize account. The codes are valid for the next fifteen hours.”
Rafael turns to leave. At the stairs he turns back. “I’ll see you in Costa Rica on Friday and we’ll execute the final phase; laundering the money.” Francisco replies, “Follow the river north until sunrise. Godspeed my friend.”
White Collar Conspiracy Scenario B
Downtown Fargo, North Dakota
It’s about noon. Mike, a loan officer, gets up from his desk and walks over to his processor’s cubicle. “Hey Joe, do me a favor would ya? That one guy we’re doin’ that loan for — Johnson — anyways, he just got fired from his job.” Joe replies, “Ya. I got that email. It’s right here. He’s supposed to close on the Monday comin’ up here. Now he can’t.”
Annoyed, Mike says, “Hey, wait just a minute here. I need it to close because I need the commission money.” Confused Joe says, “Hold on there fella. If he’s got no job, he’s got no income and won’t be able to make the payments. So then, he can’t well close on the Monday. It’s against the rules Mike. It just ain’t right.”
Mike pokes his head into the next cubicle and sees that they’re alone. He whispers, “Okay, here’s the thing. The thing is, is I think he’s pretty much got a new job. But the real deal is, is the loan’s already approved with the job he just got fired from. Nobody’ll know the better if he closes on the Monday — ‘specially if no one says nuthin’ ’bout him gettin’ fired and everything. Geez, just delete the darn email Joe.”
Joe stands up and looks in the next cubicle to see where the eavesdroppers aren’t, then replies, “What are you sayin’?” Mike rolls his eyes, “For cryin’ out loud Joe, what da ya think I’m sayin’? Just keep your mouth shut and don’t be such an idiot. For cripes sakes, just keep it quiet will ya. Hey — I’ll buy you a real nice jacket or a new cat or something.”
Joe sits down, turns back to his computer and taps ‘delete’ on his keyboard. Then says, “Okay then, I won’t say nuthin’. Geez oh Pete!” He pauses then says, “And… I’ll take the cat.”
Both of these scenarios fall under the definition of criminal conspiracy. By general definition a criminal conspiracy is an agreement between two or more people to commit a crime — and take a step towards committing that crime.
In fact, the crime doesn’t even have to be committed or successful. Perhaps Francisco accidentally drops the flash drive in a hot cup of coffee and the data gets erased; it is still a white collar conspiracy crime.
In the mortgage scenario, the borrower, Johnson, could wind up short on ‘cash to close’ and his closing comes to a screeching halt and never happens. It’s still a white collar conspiracy.
Additionally, there doesn’t have to be any profit or loss as a result of the conspiracy. Maybe Mike priced the loan wrong and he loses his commission. Or, maybe Johnson’s loan does close and he actually makes timely monthly payments for the next thirty years — a performing loan and no losses by the lender. No harm no foul, right? Nope. It’s still a crime.
White Collar Conspiracy Investigation
One never knows, with absolute certainty, the scope of the activity of the other players in a transaction. In the event of a conspiracy investigation, Mike, the loan processor’s name will come up even though he didn’t plan it. The FBI will look at all his old loan files. If Mike and Joe were willing to break the rules for this one transaction… Well, let’s just say that the FBI might take into consideration how many cats Mike actually has?
Guilt of an Accused White Collar Conspirator
Guilt by association is a very real thing. We all want to think one is innocent until proven guilty, but let’s face it; society has become pretty numb to newspaper headlines such as, “INSIDERS ACCUSED OF MONEY LAUNDERING.” Most glaze right over the word, ACCUSED.
I believe that the ‘accused’ are considered innocent in the federal court system, but to the public, the accused are guilty.
If you are a white collar professional and your name was substituted for the word “Insiders” in the above headline, do you think your clients would continue to do business with you? Most professionals would un–friend you and deny that they’d ever done business with you.
Someone told me a long time ago, “The appearance of impropriety is as bad as impropriety itself.” I wish I would have heard that at a younger age.
Staying out of the murky area is absolutely critical. Always be consistent and diligent. You cannot cross the line because you think it will be okay — just this one time.
By skirting the rules just once, not only are you susceptible to being involved in a fraud conspiracy, but the first time you justify unethical behavior, the next time becomes much easier — and the next time and the next time… It’s that famous slippery slope.
I’m not saying that it’s impossible to resist the temptation to be involved in a white collar conspiracy. It is possible and most people do it every day. But statically, most people who commit fraud do not wake up one morning and say to themselves, “Today, I am going to commit a crime.” It usually starts with something small — which seems insignificant. Fraud does not just “happen.” You are in control and you are responsible.
For what it is worth, coming from a convicted felon, stay on course. If someone tries to tempt you to the dark side, ask them if they’ll be able to give your kids a ride to prison on visiting days. Or, find out if they can arrange daycare for a couple of years while your spouse gets a second or third job. And how about rebuilding your reputation, career, self–esteem, self–confidence…
Jerome Mayne is an international keynote speaker on fraud and ethics. In 1999, he received a 21–month prison sentence stemming from federal charges of conspiracy to commit mail fraud, wire fraud and money laundering.
He is the author of the book, “Diary of a White Collar Criminal” and co–author of “Mortgage Fraud and Predatory Lending — what every agent should know” (Kaplan Publishing). He has worked with dozens of companies and associations around the country helping business professionals stay out of prison.
© 2019, Jerome Mayne