Case in Point: Case history dissection
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In this ever-changing world, it’s a comfort to know that some things are universal and eternal. The morning cup of coffee. The annual FSU-Florida game. The Macy’s Thanksgiving Day Parade. And, in Fraudville, classic check fraud — arguably The Little Black Dress of financial crime. As a Certified Fraud Examiner and paralegal with the Hennepin County Attorney’s Office (HCAO) in Minneapolis, Minn., I work innumerable criminal cases of individual con artists who steal a lot of money from employers, retail establishments, banks, families, friends and foes, with tools not much more sophisticated than a computer, a color printer, a cell phone and chutzpah. Even these con artists, spread out as they are among industries, tend to fall into patterns. I would like now to tell you of my favorite post-modern paperhanger — a woman of great energy, ingenuity, charm and greed, who during a 3½-year period wrote more than $430,000 in worthless checks to finance a lifestyle that she was sure she deserved. Ladies and gentlemen, I give you Fluffie, the Bank Account Slayer.OUR FAIR FLUFFIE: THE EARLY YEARS Fluffie Van Guilder (not her real name, of course) was born in the late 1950s and grew up alternately in the upper Midwest and the Carolinas. It’s not known from public records if she ever had anything resembling a job. At some point, she landed in the Twin Cities of Minnesota, where between 1990 and 2008 she racked up 13 individual criminal charges involving check fraud and 21 individual criminal charges of serious driving violations, most of which were alcohol-related. Fluffie loved good food, nice apartments and girly creature comforts; she also loved driving expensive cars and drinking expensive spirits — usually simultaneously. Her need and desire for money, her sense of entitlement to The Good Life and her legal bills were matched only by her lack of desire to earn a paycheck to fund them.By the early 2000’s, Fluffie had driven her personal banking and credit ratings into the ditch. As is true in many regions, Twin Cities’ banks run histories on new account applicants’ Social Security numbers as well as their names with bank account verification services. For a long time Fluffie defeated the name search by using variations of her name when applying for new personal accounts (“F. Van Guilder,” “F. V. Guilder,” “Fluffie V. Guilder,” “FV Gilder” and “Fluff V. Gilder,” to name a few), but eventually she was trapped in her own wrecked Social Security number and didn’t have the means or the skill to steal anybody else’s. It was at this point that Fluffie discovered and raised to a perverse maturity her new modus operandi: The Sham Business Checking Account.THE MODUS OPERANDI OF TYCOON FLUFFIE At least twice, Fluffie filed business organization papers with the Minnesota Secretary of State, and one more in Delaware, setting up LLCs and one domestic corporation. Armed with the filing numbers and certificates from these state biz-org departments, Fluffie then obtained multiple federal taxpayer and employer identification numbers from local county authorities. Now fully loaded for bear, Fluffie then opened up a business checking account at a local bank with one of the pristine federal taxpayer ID numbers and a deposit of a $100 check drawn on one of her numerous closed personal accounts. She also immediately asked for and received starter checks for this new account and ordered business checks for this new account. Her business account representative, anxious to accommodate a new account, of course issued the starter checks, and Fluffie then exploded in a frenzy of estrogen-soaked consumerism.Needless to say, the checks started to bounce fairly rapidly. Fluffie relied on the spotty and clumsy check collection practices of the businesses and individuals she had stiffed, and their associated time-float, to keep the checking account viable at the bank. When it was clear the account was on life support, she then opened up another checking account at another bank with another fictitious business application and another bad business-account check; she got another raft of starter checks and printed checks and a new lease on her paperhanging life. Fluffie lived off these accounts, using checks to pay for items as big as car down payments, jewelry and rent, and as small as cups of coffee from Starbucks, and everything in between including top-shelf alcohol.The logic of Fluffie’s M.O. is clear and easily discerned. Banks wouldn’t get adverse histories on brand-new federal taxpayer or employer identification numbers, which were very easy and inexpensive to obtain. Banks large and small, eager to bring new accounts into the tent, often give far less scrutiny to business account applicants than they do personal account applicants. In fact, at times, Fluffie didn’t even have to produce any documents from the secretary of state’s office for the purported business, nor did she have to produce any documentation of the federal taxpayer or employer ID number. Her assertions on bank account applications were enough, whether they were submitted in person to an account representative or online, and her polished persona persuaded many an account representative to do whatever she smilingly asked. Further, banks often don’t put a hold on the availability of funds from check deposits to ensure the check clears, and Fluffie more than once falsely inflated the balance of a dying account by depositing yet another bad check from a different moribund account or simply sent an empty envelope through an ATM and falsely keyed in a check deposit amount of $6,000. Also, as puzzling as this is, frequently vendors trust business checks more than they do personal checks and don’t require any identification at the time the check is tendered. Even if a bank requests an ID, it doesn’t scrutinize it as carefully as when a personal check is presented, nor does it request or require more information including driver’s license number or telephone number. Well now. Please buckle up as I describe Fluffie’s Amazing Journey, which became the case for which the HCAO eventually prosecuted her: Between August 2003 and December 2004, Fluffie opened up six business bank accounts using the business names “Beau Ideal Inc.,” “Alexandra Boulevard Enterprises,” “FV Gilder” and “Chassé Consortium” at four separate banks of varying size — all with opening deposits of worthless checks from previously closed accounts. She wrote from those accounts 398 checks totaling $205,898.32 — all of which bounced. Most accounts lasted between 18 and 81 days before the banks closed them, although one account lasted for 538 days — a record of sorts that Fluffie would never again achieve. Midway during this period, Fluffie was placed on felony probation for a previous theft by swindle conviction, but that didn’t dampen her spirit. Between January and December 2005, Fluffie opened up five business bank accounts using the names “Alexandra Boulevard Productions,” “T. Brand Communications” and “Tee Brand Communications LLC” at four new separate banks again of varying size, again all with either no opening deposit or with a check from a previously closed account. She wrote 396 checks from those accounts totaling $134,251.47, all of which bounced. The accounts lasted between six and 47 days before they were closed, probably due to exhaustion. (Hang in there, friends.)Between January 2006 and March 2007, Fluffie opened yet four more business bank accounts using the names “Beau Ideal, Inc.,” “T. Brand Communications,” “Alexandra Boulevard Enterprises” and “Beaux Idées, Inc.” at four separate banks. Interestingly, three of these banks were repeaters from earlier Fluffie Specials from 2003 to 2005. Equally interestingly, the fourth bank was one that specialized in commercial accounts and agreed to give Fluffie her beloved starter checks on the promise of a wire deposit to fund the account — a wire deposit that never materialized. Fluffie opened and closed this account on St. Patrick’s Day, during which she, with crisp efficiency, wrote seven bad checks totaling $2,213.36. In sum, from 2006 through 2007, Fluffie wrote 353 checks totaling $91,421.91, all of which bounced, on accounts that lasted between one day and 64 days.I trust that by now you are as drained from reading this detail as I am in writing it. This highlights one of the challenges of identifying, investigating and prosecuting paperhangers: They. Write. So. Many. Frickin’. Checks. From so many accounts. To so many hapless, unconnected victims. In so many cities. With so many law enforcement and prosecutorial jurisdictions, with so little ability to quickly share information. With such blinding speed, so that by the time they are caught (if ever), they’ve caused enormous financial damage.
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