What are some of the smartest scams that ALMOST made it through?
Let’s get right into it and start with:
6 - Gullible Racing Over a decade, Valentyn Belan defrauded Hong
Kong businessman and race-car driver Jacky Yeung out of $20 million.
Ukrainian Belan ran a marriage agency in his home country, a service that matched foreign,
affluent men with potential wives.
Yeung arrived in Ukraine in 2008.
A defense sentencing memo claimed he was in the country to find a potential partner, although
Yeung’s attorney vehemently denied the claim.
Either way, Yeung met Belan, and the two discussed potential investment opportunities.
Belan convinced Yeung to invest in a travel agency, and a year later, Yeung had spent
$9 million on seven buildings and a sports field.
However, the businessman didn’t know he hadn’t actually purchased any of the properties.
Belan wired him $50,000 monthly, which he claimed was rental income.
Now that Belan had developed a strong business relationship with Yeung, he persuaded the
racer to invest in a rare-earth mine that provided metals for electronic devices.
The investment could be very lucrative for Yeung- if it was real.
Presentations The investment opportunity was a scam, but
Belan took extreme measures to make it look legit.
Yeung visited Ukraine in 2010, and Belan arranged a motorcade to drive him to meet a government
minister at her estate.
Except, the woman Yeung met was a hired actor, and the home was a hotel.
The fraudster also arranged to have someone pose as a fellow investor in the mine, who
presented fake documents that alleged she paid $500,000 to buy into the rare-earth enterprise.
Belan and Yeung then went to Dubai to work on a deal for the mine in the summer of 2010,
where Belan introduced Yeung to a young woman who he pretended was the government minister’s
daughter.
He said she was a Yale graduate.
Yeung asked why she didn’t speak English, to which Belan explained she didn’t need
to learn it as she studied Russian literature.
And he bought that.
Yeung needed to free up funds to keep up with his investments with Belan.
He sold his home and his Bentley and McLaren luxury cars.
Belan persuaded Yeung to sell a building he owned to fund another mining investment and
even provided potential buyers for the building, who would pay the businessman directly.
To prove the sale was valid, Belan sent Yeung a photo of himself with stacks of cash.
Of course, those buyers didn’t exist, and Belan transferred ownership of the $13 million
to himself.
Things were going well for Belan.
Until they weren’t.
Aftermath
Things fell apart when Belan’s relationship with his girlfriend, Olena Chumachenko, crumbled.
Belan took their two children to LA and Manhattan without Chumachenko’s consent.
Chumachenko filed a Hague Convention action, an act designed to resolve international kidnapping
cases.
However, Belan still refused to let her see their children.
Desperate, Chumachenko reached out to Yeung to put pressure on Belan.
She told him Belan had taken their children and wouldn’t let her see them.
Yeung asked about his investments and mentioned the mines.
Chumachenko informed him she had no idea what he was talking about and that Belan didn’t
invest in mines.
Belan was arrested and pleaded guilty to the scheme in May 2019.
He received a prison sentence of 109 months, followed by three years of supervised release,
and was ordered to forfeit $20,107,243 and to pay $13,309,918 in restitution.
5 - Stealing Houses?
Career conman Joseph Makhani ran a real estate scheme in New York City that preyed upon people
struggling to make ends meet.Human snake Makhani had a long history of faking documents and
preying upon the vulnerable.
He found his targets by monitoring local courts, searching for homeowners who died without
wills, and scouring tax liens to find properties in financial distress.
One of his targets was Ronald Stewart, a disabled man living with his daughter in the $2 million
home he inherited from his mother.
Stewart fell behind on the property taxes he owed the city.
Makhani saw an opportunity.
Back Taxes
The debt had caught Makhani’s beady eyed attention.
Stewart received eviction papers in 2013, making it appear that his financial struggles
had caught up to him.
The eviction papers came from a company linked to Makhani and stated that another company,
also operated by Makhani, had paid Stewart’s back taxes and now owned the property.
Makhani then handed Stewart more papers a few months later.
Stewart later admitted he only skimmed the paperwork before signing because like most
of us, he’s not a lawyer, and those ridiculously worded papers don’t make much sense.
The documents contained a deed from December 18, 2012, signed by a South Carolina woman
Stewart had never met.
The deed gave Makhani control over the Harlem property and offered Stewart $2690 for a deposit
on a new place, but Stewart never saw a penny of that money.
Instead, Stewart moved into a single-room occupancy where he paid $200 per week.
Almost a year after receiving the eviction papers, Stewart sued Makhani in the Manhattan
State Supreme Court.
It took five years for a jury to give Stewart his home back, finding Makhani had tricked
him into giving up the property.
But Makhani, who has no conscience, refused to go down without a fight.
He quickly sued Stewart to recoup the property taxes and maintenance Makhani paid when the
home was in his possession.
The judge dismissed the case, but Makhani filed an appeal anyway.
Harlem Brownstone
In 2012, Makhani turned his sights to a $2.2 million Harlem brownstone owned by Veronica
Palmer, an older woman who bought the building in 1985.
Makhani created a company named Palmer Organization LLC, to make it look like it was Veronica’s
company- which it wasn’t.
Then, he had his lawyer file paperwork claiming the LLC as the rightful owner of the building.
Makhani’s longtime attorney, Steven Masef, created the LLC and listed his address as
Makhani’s Queens office.
Makhani filed the paperwork with the city, which didn’t question it, as it seemed like
she had transferred the property to her LLC.
In New York, a limited liability company doesn’t have to identify its owners publicly and doesn’t
require the owners to list their addresses.
Quiet Titles
Scammers across New York City will transfer property from one LLC to another multiple
times and then start a ‘quiet title’ proceeding.
In the proceeding, the final LLC in possession of the property sues everyone involved, including
the other LLCs that held the title before.
Makhani followed that same scheme and sued Veronica Palmer, the Palmer Organization,
and other companies connected to her townhouse through another LLC he controlled called One
18 Street Corp.
The filing stated One Street Corp paid Palmer $10 for her home.
When Palmer received the paperwork, she either didn’t know she needed a lawyer or didn’t
have the means to hire one.
Palmer never showed up in court to fight Makhani’s claims, and a judge issued an automatic win
for Makhani’s One 18 Street Corp., which is a default judgment.
It gave him control of the property.
Makhani took out a $1.2 million mortgage loan and a $650,000 line credit for construction
to renovate and convert the building to a multi-unit rental, where he made $3,000 to
$3,400 per unit each month.
Veronica Palmer lost everything and was homeless.
In July 2021, authorities finally arrested Makhani, and the state Attorney General indicted
him on charges of mortgage fraud, falsifying business records, and criminal possession
of stolen property.
4 - Coupon Crimewave In 2012, Arizona police arrested Robin Ramirez,
Amico Fountain, and Marilyn Johnson in connection with a bust for the biggest counterfeit coupon
ring in the country.
The three women ran the business in the Phoenix area and used their aptly named website, SavvyShopperSite,
to sell fake coupons to customers at a highly discounted rate.
The group invited users to join their fake website to receive free or discounted coupons
and gave them a 100 percent guaranteed refund if they were deemed invalid at the point of
sale.
The coupons were for things like free pet food, household goods, and diapers, offered
from as many as 40 major manufacturers, including Hershey and PepsiCo.
One coupon purchaser raved on a message board after paying $7 for a mega pack of Pampers
diapers.
Customers had access to unlimited coupons and saved hundreds of dollars monthly.
Some people even got cash back if the value of the coupon exceeded the item's price.
If a person had a $25 coupon for dog food, they could buy a $15 bag and receive the difference
in cash.
Ramirez began selling counterfeit coupons in 2007, and the other women joined later.
The trio had the coupons made overseas.
Some were made up, but others were reproductions of legitimate coupons.
The name SavvyShopperSite drew in customers due to its similarity to the 'Savvy Shopper'
magazine, which sends out real coupons weekly.
Price Check
Procter & Gamble discovered fake coupons in circulation during a routine audit of third-party
coupon processors.
They contacted private investigators to get to the bottom of the situation and reached
out to the Coupon Information Corporation, which apparently is a thing?
The company brought in the Phoenix police, who conducted an eight-week investigation.
The police went undercover to make purchases and identify the three women- they must be
pretty bored in Phoenix.
Authorities raided Ramirez's home in July 2012 and seized over $25 million in fake coupons.
They also discovered and seized more than $2 million in other assets, including cash,
211 vehicles, 22 guns, and a speedboat.
All the expected stuff you’d need when running a fake coupon ring with other housewives.
The three women were making so much money in the scheme they didn't know how to spend
it all.
Authorities uncovered large amounts of cash and even an airplane hangar filled with sports
cars and a fully decked-out RV.
Aftermath
Police finally arrested the trio and charged them with forgery, fraud, and counterfeiting.
As the ringleader, Ramirez was the only that faced prison time, receiving a two-year sentence,
while Fountain and Johnson got probation.
The court ordered all three to pay roughly $1.3 million in restitution to Procter & Gamble.
The women's story became a movie called Queenpins that starred Kristen Bell.
It offers a comedic take on the trio's scam, where a suburban housewife and her vlogger
friend devise a scheme to sell fake coupons online and make millions of dollars.
However, the trio will never see a penny from the movie as Arizona state law forbids convicted
criminals from profiting by selling their stories- which makes sense, but seems a little
unfair.
The movie's writer-directors emphasized the story was a fictional version of their actions.
Ramirez, Johnson, and Fountain are now living a much more low-profile lifestyle and seem
to want to separate themselves from their crimes, minus making their monthly restitution
payments.
3 - She Didn’t See Her Future?
Psychic Zoe, a self-proclaimed psychic who operated in New York City, used her spiritual
status to con at least two clients out of over $800,000.Psychic Zoe, whose real name
is the less psychic sounding Ann Thompson, claimed to be a psychic medium and offered
$5 readings to her clients.
Thompson convinced some clients they needed more spiritual attention than just a quick
reading.
She told them they needed to give her money for a spiritual protection plan to protect
their family members.
Thompson’s service wasn’t cheap, but she assured her clients she would return the funds
once the protection plan ended.
She later refused to return the funds, claiming it would put her targets and their families
in danger.
So, basically, scientology.
When a 49-year-old man from the Midwest visited her, she convinced him he was suffering from
psychic maladies and that an evil spirit was tormenting his son.
It was plausible as the man was having a difficult time with his son.
She coerced him into buying $72,000 in gold coins to cure his aura.
He would then visit her temple with them as part of the ritual.
Thompson informed the man he would only have to supply half the gold coins, and her temple
would cover the other half.
She promised that by the end of the ritual, he could either keep the gold coins or she
would return the money.
They signed a contract that outlined the terms.
In blood.
Next to a skull with a candle on it.
Just kidding- but that’s how it should’ve been.
The man discussed the matter with his wife and decided to ask for the money back, as
promised, but Thompson refused.
Curses Another target was a woman in her 50s from
Canada.
She was visiting her college-aged child in New York in 2013 and paid Thompson $5 for
a reading.
Thompson told her she was in danger and was plagued by several curses.
Then, Thompson convinced her she needed to purchase gold coins and some other items,
which would be set up in Thompson’s temple to protect her from danger.
Thompson assured her the temple wasn’t making a profit from the transaction and that everything
inside was the woman’s property.
Over four years, Thompson swindled $740,000 from her.
When they realized she was a fraud, they hired Bob Nygaard, a private investigator specializing
in the apprehension of psychic scammers.
Nygaard began investigating the case in 2016 and, in 2018, had enough information for a
formal police report.
Aftermath
Police arrested Thompson for conning her clients out of over $800,000.
Her targets testified in court about Thompson preying on them as they struggled psychologically
and emotionally.
The female target described Thompson as evil.
She turned her life savings over to the supernatural fraudster, and the situation drove her to
homelessness.
The woman pleaded with the judge not to let Thompson out on probation.
Thompson spent eight months in jail before being released due to the pandemic.
She pleaded guilty to scheming to defraud and grand larceny charges in Manhattan criminal
court.
The judge sentenced her to five months on probation and agreed to pay back more than
$200,000 as part of a plea deal.
Thompson then gave a brief, half-hearted apology to the people she scammed
2 - Posting Weights New Jersey businessmen Jack Koch and Steven
Koch conducted an elaborate scheme that stole millions of dollars from the United States
Postal Service.
The pair used doctored labels to ship the household products they sold on Amazon at
a cheaper, flat rate.
To do this, they bought flat-rate envelope postage labels designated for USPS-produced
compact envelopes and removed the ‘FLAT RATE ENV’ endorsement from the labels.
They removed the labels electronically and then reapplied the altered labels to packages
that didn’t qualify for the Flat Rate Service to avoid paying higher postage rates.
Flat Rates
The USPS requires that pieces of mail under 70 pounds have the designation of Flat Rate
Envelope to use the discounted rate, although other mail pieces don’t need to bear labels
showing the postage was prepaid.
This process allowed them to ship awkwardly shaped packages like bottles of water, laundry
detergent, and even cases of soda at a low rate.
Jack and Steven purchased over 240,000 USPS Priority Mail Labels, most of which were for
flat rate envelopes, through their business Fresh N Clear.
Altered
When federal authorities raided Fresh N Clear’s warehouse, they found roughly 225 priority
mail packages with fraudulently altered labels.
The scam cost USPS at least $6 million in postage revenue.
Jack and Steven pleaded guilty to mail fraud charges before U.S. District Judge William
J. Martini.
The charges carry a maximum penalty of 20 years and a maximum fine of $250,000.
1 - Forced Testing Donald Booker and Delores Johnson devised
a scheme to defraud millions of dollars from the North Carolina Medicaid program.
Between the two, they filed over $20 million in claims and received $15 million in reimbursements
for urine testing services.
Booker and Johnson ran their own companies.
Booker had two organizations, United Youth Care Services, which provided mental health
and substance treatment services, and United Diagnostic Laboratories, a urine toxicology
testing laboratory.
Johnson owned a subsidized housing provider called Legacy Housing.
Alongside her co-conspirators, she used her connections through the organization to recruit
housing-vulnerable individuals and other people who were Medicaid-eligible beneficiaries for
housing and other programs and services.
Testing
Enrolled beneficiaries had to perform testing to participate in the programs.
Johnson would collect the specimens and send them to United Diagnostic Laboratories and
United Youth Care Services, who would perform the unnecessary testing.
The two would tell participants in the programs that they would lose their housing if they
didn’t agree to the testing.
At least one person’s case file was falsified with a list of addictions she didn’t have.
Booker and Johnson even encouraged substance use from their participants; if they tested
clean, the fraudsters would punish them.
They needed their targets to appear to be struggling with addiction so medical professionals
would sign off on documents authorizing the testing as medically necessary.
Booker then received reimbursements from North Carolina Medicaid, which he would use to pay
a kickback to the co-conspirators.
Between January 2016 and May 2021, Booker’s companies submitted millions of dollars in
claims to Medicaid.
Booker paid over $1.6 million in illegal kickbacks to Johnson for the testing samples from actual
Medicaid beneficiaries.
Aftermath
Eventually, one unnamed person had enough.
The transitional housing she had been in for eight months was rodent and roach infested.
She’d approached Booker about the living conditions several times, but he just dismissed
her.
So, she filed a formal complaint against Booker and Johnson.
The FBI arrested Booker and Johnson on federal charges, including conspiracy to commit health
care fraud, violations of the Anti-Kickback Statute, conspiracy to commit money laundering,
and actual money laundering.
In December 2022, Jordan pleaded guilty to conspiracy and money laundering.
Booker pleaded not guilty, but a jury convicted him of conspiracy to commit health care fraud,
multiple violations of the Anti-Kickback Statute, money laundering, and money laundering conspiracy.
They now await sentencing.
Prison will probably be an upgrade to the slums the two were running.
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Let us know in the comments below what you think the percentage of illegal scams that
are actually caught?