Archive for January, 2007
Wed 31 January 07 · Filed under Uncategorized
An audit by the special inspector general for Iraq reconstruction, Stuart Bowen Jr., shows significant waste, abuse, and fraud of funds. The Iraq war and reconstruction is estimated to have cost $300 billion so far.
Among the questionable items:
- $43.8 million was paid to DynCorp International to construct a residential police training camp that has been empty for months. The camp includes an Olympic-size swimming pool and 20 VIP trailers, at a cost of about $4.2 million. The trailers and pool were never authorized by the U.S.
- $36.4 million spent for weapons, body armor, armored vehicles, and communications equipment that is nowhere to be found
- $18 million billed by DynCorp that doesn’t have supporting documentation
The State Department says new controls are in place to identify instances of waste and abuse. Already, the new review process flagged a $1.1 million invoice from DynCorp that used the wrong billing rate.
There are currently 78 active criminal cases open with the office of the special inspector.
Tue 30 January 07 · Filed under Fraud News Stories
In true consumer fight-back style, Ellen Fein has started a website to criticize Dr. Larry Rosenthal. Ellen is one of the authors of the book “The Rules”, while Rosenthal calls himself the “Dentist to the Stars.”
Ellen claims that Rosenthal botched her dental work on her website lyingdentist.com. She says on the site that she had veneers put on her top teeth and was happy with those. When she returned to Rosenthal to get her bottom teeth done, she says he gave her “gigantic” teeth and he altered her bit. Both, she claims, have caused her pain and countless medical problems.
Rosenthal has filde a $5 million lawsuit against her, alleging that Ellen has been harassing him and trying to get $100,000 from him because she’s unhappy with the dental work.
Mon 29 January 07 · Filed under Fraud News Stories
Welcome to another edition of The Carnival of Fraud!
I’ll start off with a very short and sweet post. Our very own Milwaukee Public School District is quite possibly the worst value for its money, when compared to all other school districts nationwide. They can burn through millions and millions like there’s no tomorrow. Curb spending? Whaaaaaat???? They’ve never heard of such a thing. Now they’re predicting an almost 4% decline in enrollment for the Fall 2007 school year. Anyone want to guess whether their budget will decrease???
Consumers beware! Have you ever gotten a pre-approved credit card application in the mail and torn it up? Lucky you. Someone can tape it back together and get credit in your name.
And on another consumer note, Matt Paulson talks about potential pitfalls and rip-offs when getting a mortgage. On the flip side, Mortgage Lowdown talks about mortgage fraud committed by those buying properties.
Stock Market Beat comments on Xerox’s creative accounting and reporting, making it look like their operations are doing better than they actually are. (Note: I like this guy’s blog, but there are way too many Google ads polluting the pages.)
Wenchypoo has an elegant rant about the idiocy of these “green” policies/proposals/laws/whatevers and how stupid politicians ought to let us take care of ourselves, thank you.
Trusted Advisor blogs about managing large law firms, and the lawyers who do it. They are a breed unto their own, aren’t the?
SoxFirst discusses independent audits and their shortcomings in regard to looking for fraud.
Calling all illegal immigrants. Wisconsin officials are here to help you get a valid driver’s license!!!
Although I don’t understand why this site exists, Avant News makes up fake (and funny) news. Here’s one they made up about a priest and eBay. Since the story isn’t even true, can someone tell me what it has to do with fraud?
Sun 28 January 07 · Filed under Fraud News Stories
According to an article in the Janesville Gazette, Wisconsin officials conducted a class to help illegal immigrants understand how to get a drivers license before April 1, 2007. On April 1, those applying for licenses or renewing licenses must have proof of legal residency. Up until then, such proof is not necessary, therefore illegal aliens can easily get drivers licenses in Wisconsin.
The session was held this past Tuesday at the Janesville YWCA, and was held in Spanish!!! Presenting the session was Terry Stark of the state Division of Motor Vehicles.
The session was given under the guise of educating people about the new rules, but it’s pretty clear that it was really meant to give illegal aliens tips on how to skirt the new rules by applying for licenses now.
Sat 27 January 07 · Filed under Fraud News Stories
Milwaukee Public Schools officials expect enrollment to drop from 84,900 students to 81,600 students this fall. That’s a drop fo 3,300 or 3.9%.
Here’s the big question: Will their budget drop proportionately????
Sat 27 January 07 · Filed under Fraud News Stories
State charges against Bryan Wagner, a private investigator involved in the Hewlett-Packard pretexting scandal, are to be dropped on Monday. He has pleaded guilty to federal charges of identity theft and conspiracy, and his plea agreement bars the state from prosecuting him.
Wagner allegedly was involved in illegally obtaining phone records during his investigation of H-P information leaks.
Fri 26 January 07 · Filed under Pyramid Schemes & MLM
From Robert FitzPatrick of Pyramid Scheme Alert:
In a crucial development that could rock the entire multi-level marketing business, a class action lawsuit has been filed this month against Quixtar (Amway) charging that the company is running an illegal pyramid scheme. (filed in US District court in the northern district of California on January 10, 2007, case number 3:07-cv-00201-EMC.)
The charges against Amway/Quixtar go to the very heart of the company’s business practices and most other multi-level marketing (MLM) schemes’, that there is no retail “direct selling” opportunity, only an endless chain recruitment program.
The charges are being brought by one of America’s most prestigious law firms, Boies, Schiller and Flexner. David Boies of this firm represented Vice-President Al Gore in front of the US Supreme Court in the world famous case, Gore vs. Bush that contested the vote counting in Florida after the 2000 election. The other firm partnering with Boies, Schiller & Flexner in the suit is Gary, Williams, Parenti, Finney, Lewis, McManus, Watson, & Sperando, P.L.. in Stuart, Florida. This firm has a powerful track record of successful class action suits against large companies.
The suit is based on the very same charges that the Federal Trade Commission has brought against Equinox, SkyBiz and other MLMs that regulators shut down. The suit charges that the Quixtar program . based upon selling products to recruits “for personal use”, then authorizing them to recruit others to do the same while requiring or incentivizing them to maintain quota levels of monthly purchases, and then rewarding them in a multi-level compensation system . is a fraud. The suit also attacks Quixtar’s infamous “tools” business as a second pyramid scheme perpetrated on new recruits. The “tools” scheme was exposed in a 2004 special report on NBC Dateline.
Using Quixtar’s own payout data a report published by Pyramid Scheme Alert has shown that 99% of all Quixtar recruits never earn any profit. In the report, “The Myth of MLM Income Opportunity,” the 99% loss rate was shown to be caused by the pyramid recruitment model and the lack of retail sales, not the “failure” of the recruits.
Fri 26 January 07 · Filed under Fraud News Stories
Microsoft’s competitors in Europe alleged today that the new Vista operating system continues the illegal practices by Microsoft discovered in Europe 3 years ago. The group complaining includes IBM, Nokia, Sun Microsystems, Adobe, Oracle, and Red Hat.
In 2004, the European Commission determined that Microsoft purposely made Windows software incompatible with competitors’ server software, as well as trying to get makers of audio and video streaming software out of the market.
Microsoft was set to release Vista on Tuesday, but the European Commission said Vista is aimed at increasing Microsoft’s dominance. The company is pushing its XAML markup language so that it may replace HTML, the current standard for publishing on the Internet. Microsoft is also using OOXML (open XML) on the Microsoft Office platform. This dictates how a document is formatted and stored, and competitors are also claiming that Microsoft is using this to increase its monopoly.
Security software makers have complained that Microsoft is denying them access to Vista, which they need to help create their products to protect computers from malicious viruses and software.
Thu 25 January 07 · Filed under Writing & Blogging
My article in this week’s Wisconsin Law Journal details some of the mistakes attorneys make when hiring and with expert witnesses. These can lead to “Litigation Disasters” of the worst kind.
Tue 23 January 07 · Filed under Fraud News Stories
The Chicago Board of Elections distributed computer discs to aldermanic campaigns in 2003 which contained the Social Security numbers of more than a million voters. The voter information on the discs also included names, addresses, and birthdates.
Since this inceident, more discs containing Social Secuirty information have been distributed. Officials said that there was no evidence of identity theft from the incidents, but the Board of Elections will notify voters that their data has been compromised.
Voter records have now been changed to only include the last four digits of Social Security numbers.
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